[Federal Register Volume 75, Number 69 (Monday, April 12, 2010)]
[Proposed Rules]
[Pages 18575-18606]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-6766]



[[Page 18575]]

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Part II





Environmental Protection Agency





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40 CFR Part 98



Mandatory Reporting of Greenhouse Gases: Injection and Geologic 
Sequestration of Carbon Dioxide; Proposed Rule

Federal Register / Vol. 75 , No. 69 / Monday, April 12, 2010 / 
Proposed Rules

[[Page 18576]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 98

[EPA-HQ-OAR-2009-0926; FRL-9131-2]
RIN 2060-AP88


Mandatory Reporting of Greenhouse Gases: Injection and Geologic 
Sequestration of Carbon Dioxide

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing a rule to require reporting on carbon dioxide 
(CO2) injection and geologic sequestration (GS). The 
proposed rulemaking does not require control of greenhouse gases 
(GHGs), rather it requires only monitoring and reporting of 
CO2 injection and geologic sequestration. EPA first proposed 
that suppliers of CO2 be subject to mandatory GHG reporting 
requirements in April 2009 and finalized the rule for suppliers of 
CO2 on October 30, 2009.

DATES: Comments. Comments must be received on or before June 11, 2010.
    Public hearings. There will be one public hearing. The hearing date 
and location is: April 19, 2010 from 9 a.m. to 1 p.m. at One Potomac 
Yard, 2777 S. Crystal Drive, Arlington, VA 22202.
    To obtain information about the public hearing or to register to 
speak at the hearing, please go to http://www.epa.gov/climatechange/emissions/ghgrulemaking.html.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2009-0926, by one of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
online instructions for submitting comments.
    E-mail: [email protected].
    Fax: (202) 566-1741.
    Mail: EPA Docket Center, Attention Docket OAR-2009-0926, Mailcode 
2822T, 1200 Pennsylvania Ave., NW., Washington, DC 20460.
    Hand/Courier Delivery: EPA Docket Center Public Reading Room, Room 
3334, EPA West Building, Attention Docket OAR-2009-0926, 1301 
Constitution Ave., NW., Washington, DC 20004. Such deliveries are only 
accepted during the Docket's normal hours of operation, and special 
arrangements should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2009-0926. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
http://www.regulations.gov, including any personal information 
provided, unless the comment includes information claimed to be 
confidential business information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site 
is an ``anonymous access'' system, which means EPA will not know your 
identity or contact information unless you provide it in the body of 
your comment. If you send an e-mail comment directly to EPA without 
going through http://www.regulations.gov your e-mail address will be 
automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses.
    Docket: All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in http://www.regulations.gov or in hard copy at EPA's Docket Center, 
Public Reading Room, EPA West Building, Room 3334, 1301 Constitution 
Ave., NW., Washington, DC. This Docket Facility is open from 8:30 a.m. 
to 4:30 p.m., Monday through Friday, excluding legal holidays. The 
telephone number for the Public Reading Room is (202) 566-1744, and the 
telephone number for the Air Docket is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: For technical information, e-mail the 
Greenhouse Gas Reporting Rule Hotline at [email protected] with the name 
of this action in the e-mail subject line, or contact Barbora Master, 
Climate Change Division, Office of Atmospheric Programs (MC-6207J), 
Environmental Protection Agency, 1200 Pennsylvania Ave., NW., 
Washington, DC 20460; telephone number: (202) 343-9899; fax number: 
(202) 343-2359. To obtain information about the public hearings or to 
register to speak at the hearings, please go to http://www.epa.gov/climatechange/emissions/ghgrulemaking.html.

SUPPLEMENTARY INFORMATION: Additional Information on Submitting 
Comments: To expedite review of your comments by Agency staff, you are 
encouraged to send a separate copy of your comments, in addition to the 
copy you submit to the official docket, to Carole Cook, Climate Change 
Division, Office of Atmospheric Programs (MC-6207J), Environmental 
Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; 
e-mail address: [email protected].
    In drafting this proposed rulemaking, EPA reviewed and considered 
comments submitted on the proposed subpart PP. However, as this is a 
new proposal, EPA will not be responding to comments received on the 
April 2009 proposed subpart PP in this rulemaking. To ensure that their 
comments are considered, stakeholders should submit comments relevant 
to this rulemaking as instructed in this document.
    Regulated Entities. The Administrator has determined that this 
action is subject to the provisions of Clean Air Act (CAA) section 
307(d). See CAA section 307(d)(1)(V) (the provisions of CAA section 
307(d) apply to ``such other actions as the Administrator may 
determine''). This is a proposed regulation. If finalized, these 
regulations would affect owners or operators of CO2 
injection wells. Regulated categories and entities include those listed 
in Table 1 of this preamble:

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           Table 1--Examples of Affected Entities by Category
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                                                   Examples of affected
            Category                  NAICS             facilities
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CO2 Enhanced Oil and Gas                    211  Oil and gas extraction
 Recovery Projects.                               projects using CO2
                                                  enhanced oil and gas
                                                  recovery.
GS Sites.......................             N/A  CO2 geologic
                                                  sequestration
                                                  projects.
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    Table 1 of this preamble is not intended to be exhaustive, but 
rather provides a guide for readers regarding facilities likely to be 
affected by this action. Table 1 of this preamble lists the types of 
facilities that EPA is now aware could be potentially affected by the 
reporting requirements. Other types of facilities not listed in the 
table could also be subject to reporting requirements. To determine 
whether you are affected by this action, you should carefully examine 
the applicability criteria found in proposed 40 CFR part 98, subpart A 
or the relevant criteria in the sections related to the injection and 
GS of CO2. If you have questions regarding the applicability 
of this action to a particular facility, consult the person listed in 
the preceding FOR FURTHER INFORMATION CONTACT section.
    Some facilities that are affected by today's proposed rule have GHG 
emissions from multiple source categories. Table 2 of this preamble has 
been developed as a guide to help potential CO2 injection 
and GS reporters subject to the proposed rule identify the source 
categories (by subpart) that they may need to (1) consider in their 
facility applicability determination, and/or (2) include in their 
reporting. The table should only be seen as a guide. Additional 
subparts in 40 CFR part 98 may be relevant for a given reporter. 
Similarly, not all listed subparts are relevant for all reporters.

            Table 2--Source Categories and Relevant Subparts
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                                          Other subparts recommended for
  Source category (and main applicable         review to determine
                subpart)                          applicability
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Injection and Geologic Sequestration of  40 CFR part 98, subpart C.
 Carbon Dioxide.
                                         40 CFR part 98, subpart W
                                          (proposed).
                                         40 CFR part 98, subpart PP.
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    Acronyms and Abbreviations. The following acronyms and 
abbreviations are used in this document.

3-D three-dimensional
CAA Clean Air Act
CBI confidential business information
CCS carbon dioxide capture and geologic sequestration
CDM Clean Development Mechanism
CFR Code of Federal Regulations
CH4 methane
CO2 carbon dioxide
DOE Department of Energy
EC European Commission
ECBM enhanced coalbed methane
EIA Economic Impact Analysis
EPA Environmental Protection Agency
EO Executive Order
ER enhanced oil and gas recovery
GHG greenhouse gas
GPG Good Practice Guidance
GS geologic sequestration
HFC hydrofluorocarbon
HFE hydrofluoroether
ICR Information Collection Request
IMO International Maritime Organization
IPCC Intergovernmental Panel on Climate Change
IRS Internal Revenue Service
MRR Mandatory Reporting of Greenhouse Gases Rule
MRV monitoring, reporting, and verification
N2O nitrous oxide
NAICS North American Industry Classification System
NTTAA National Technology Transfer and Advancement Act
O&GJ Oil and Gas Journal
OAR Office of Air and Radiation
OMB Office of Management and Budget
OW Office of Water
PFC perfluorocarbon
QA/QC quality assurance/quality control
R&D research and development
RFA Regulatory Flexibility Act
SBREFA Small Business Regulatory Enforcement Fairness Act
SDWA Safe Drinking Water Act
SF6 sulfur hexafluoride
TSD technical support document
UIC Underground Injection Control
UNFCCC United Nations Framework Convention on Climate Change
US United States
UMRA Unfunded Mandates Reform Act of 1995
USDA United States Department of Agriculture
USDW underground source of drinking water
VEF Vulnerability Evaluation Framework

Table of Contents

I. Background
    A. Organization of This Preamble
    B. Background on the Proposed Rule
    C. Overview of the Proposal
    D. Legal Authority
    E. Relationship to the Proposed UIC Class VI Rulemaking Under 
the Safe Drinking Water Act
    F. Relationship to Other CO2 Injection Information 
Collection and Reporting Efforts
II. Rationale for Reporting, Recordkeeping and Verification 
Requirements
    A. Definition of Reporting Facilities
    B. Selection of Reporting Thresholds
    C. Selection of Data To Be Reported
    D. Selection of Monitoring, Reporting, and Verification (MRV) 
Plan Requirements and Approval Process
    E. Selection of Schedule and Process for Reporting
    F. Selection of Procedures for Estimating Missing Data
    G. Selection of Records to Retain
III. Economic Impacts of the Proposed Rule
    A. How were compliance costs estimated?
    B. What are the costs of the proposed rule?
    C. What are the economic impacts of the proposed rule?
    D. What are the impacts of the proposed rule on small 
businesses?
    E. What are the benefits of the proposed rule for society?
IV. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations

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I. Background

A. Organization of This Preamble

    This preamble is broken into several large sections, as detailed in 
the Table of Contents. The following paragraphs describe the layout of 
the preamble and provide a brief summary of each section.
    Section I of this preamble contains the basic background 
information about the origin of this proposed rulemaking, including a 
discussion of how it relates to the finalized requirements for 
Suppliers of CO2 (under 40 CFR, part 98, subpart PP) and to 
the Underground Injection Control (UIC) program. This section also 
discusses EPA's legal authority under the Clean Air Act (CAA) to 
collect the proposed data, and the benefits of collecting the data.
    Section II of this preamble summarizes the general provisions of 
this proposed rulemaking for reporting CO2 injection and GS. 
This section also provides a brief summary of, and rationale for, the 
selection of key design elements. Specifically, this section describes 
EPA's rationale for the proposed (i) definition of reporting 
facilities, (ii) applicability thresholds, (iii) data reporting 
requirements, (iv) monitoring, reporting and verification (MRV) plan 
requirements and process, (v) schedule and process for reporting, (vi) 
procedures for estimating missing data, and (vii) recordkeeping 
requirements. Thus, for example, there is a specific discussion 
regarding appropriate applicability thresholds, monitoring 
methodologies and reporting and recordkeeping requirements for all 
CO2 injection facilities, and additional requirements for 
facilities that conduct GS. EPA describes the proposed options for each 
design element as well as the other options considered. Throughout this 
discussion, EPA highlights specific issues on which the Agency solicits 
comment.
    Section III of this preamble provides the summary of the cost 
impacts, economic impacts, and benefits of this proposed rule from the 
Economic Impact Analysis (EIA). Finally, Section IV of this preamble 
discusses the various statutory and executive order requirements 
applicable to this proposed rulemaking.

B. Background on the Proposed Rule

    On December 26, 2007, President Bush signed the fiscal year 2008 
Consolidated Appropriations Act authorizing funding for EPA to issue a 
rule requiring the mandatory reporting of greenhouse gas (GHG) 
emissions (Consolidated Appropriations Act, 2008, Pub. L. 110-161, 121 
Stat. 1844, 2128 (2008)). An accompanying joint explanatory statement 
directed EPA to ``use its existing authority under the Clean Air Act'' 
to develop a mandatory GHG reporting rule.
    The proposed Mandatory Reporting of Greenhouse Gases Rule (MRR) was 
signed on March 10, 2009, by Administrator Lisa Jackson and was 
published a month later (74 FR 16448, April 10, 2009). After a 60-day 
comment period, two public hearings, and meeting with over 4,000 
additional people in over 150 groups via Webinars, conferences, 
individual meetings, and other forms of outreach, EPA issued a final 
rule on October 30, 2009 (74 FR 56260). The MRR requires reporting of 
GHG emissions and supply from all sectors of the economy, including 
fossil fuel suppliers, industrial gas suppliers, and direct emitters of 
GHGs. The rule does not require the control of GHGs; rather the rule 
requires only that sources above certain threshold levels monitor and 
report those GHGs.
    The final MRR covers the major GHGs that are directly emitted by 
anthropogenic activities. These include carbon dioxide 
(CO2), methane (CH4), nitrous oxide 
(N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), 
sulfur hexafluoride (SF6), and other specified fluorinated 
compounds (e.g., hydrofluoroethers (HFEs)) used in boutique 
applications such as electronics and anesthetics.\1\
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    \1\ These gases influence the climate system by trapping in the 
atmosphere heat that would otherwise escape to space. Additional 
information about GHGs, climate change, climate science, and other 
related issues, can be found at EPA's climate change Web site at 
http://www.epa.gov/climatechange/.
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    The final rule contains 31 subparts, each requiring reporting from 
a defined source category. In order to meet the reporting time, quality 
assurance, and verification requirements of the rule, EPA is 
establishing a facility-to-EPA electronic reporting system to 
facilitate collection of data under this rule. All facilities that are 
covered under this rule as reporters will use this data system to 
submit required data.
    Subpart PP requires the reporting of CO2 supplied to the 
economy. Subpart PP applies to all facilities with CO2 
production wells, facilities with production process units that capture 
and supply CO2 for commercial applications or that capture 
and maintain custody of a CO2 stream to sequester or 
otherwise inject it underground, and to importers and exporters of bulk 
CO2. During the public comment period on the rule, EPA 
received many comments on subpart PP that CO2 injected 
underground should be considered when estimating emissions from the 
CO2 supply industry. Some commenters specified that some of 
the CO2 supplied for the purposes of enhanced oil and gas 
recovery (ER) is additionally sequestered rather than emitted and 
characterized ER operations as ``closed systems'' rather than emissive. 
Other commenters stated that including reporting requirements for 
geologically sequestered CO2 would fill a critical gap in 
the reporting system. EPA agrees that ER is a potentially non-emissive 
end use and that GS data reporting from ER sites can assist EPA in 
quantifying the amount of CO2 that is permanently and 
securely geologically sequestered. In addition, EPA agrees that GS 
reporting requirements would provide information and transparency on 
the amount of CO2 injected and geologically sequestered in 
the United States.
    Although CCS is occurring now on a relatively small scale, it could 
play a larger role in mitigating GHG emissions from a wide variety of 
stationary sources. According to the Inventory of U.S. Greenhouse Gas 
Emissions and Sinks: 1990-2007, stationary sources contributed 67 
percent of the total CO2 emissions from fossil fuel 
combustion in 2007.\2\ These sources represent a wide variety of 
sectors amenable to CO2 capture: electric power plants 
(existing and new), natural gas processing facilities, petroleum 
refineries, iron & steel foundries, ethylene plants, hydrogen 
production facilities, ammonia refineries, ethanol production 
facilities, ethylene oxide plants, and cement kilns. Furthermore, 95 
percent of the 500 largest stationary sources are within 50 miles of a 
candidate GS reservoir.\3\ Estimated GS capacity in the United States 
is over 3,500 Gigatons CO2 (GtCO2) (13,000 
Gigatons CO2 at the high end),\4\ although the actual 
capacity may be lower once site-specific technical and economic 
considerations are addressed. Even if only a fraction of that geologic 
capacity is used, CCS is poised to play a sizeable role in mitigating 
U.S. GHG emissions.
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    \2\ U.S. EPA Draft Inventory of U.S. Greenhouse Gas Emissions 
and Sinks, 1990-2007, Draft Report, EPA 430-R-09-004. Available at: 
http://epa.gov/climatechange/emissions/usinventoryreport.html.
    \3\ Dooley, JJ, CL Davidson, RT Dahowski, MA Wise, N Gupta, SH 
Kim, EL Malone. 2006. ``Carbon Dioxide Capture and Geologic Storage: 
A Key Component of a Global Energy Technology Strategy to Address 
Climate Change.'' Joint Global Change Research Institute, Battelle 
Pacific Northwest Division. PNWD-3602.
    \4\ DOE. 2008. Carbon Sequestration Atlas of the United States 
and Canada (Atlas II). Available at: http://www.netl.doe.gov/technologies/carbon_seq/refshelf/atlasII/.
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    Many of the injection and monitoring technologies that may be 
applicable for

[[Page 18579]]

GS are commercially available today and will be more widely 
demonstrated over the next 10 to 15 years.\5\ The oil and natural gas 
industry in the United States has over 35 years of experience of 
injection and monitoring of CO2 in the deep subsurface for 
the purposes of enhancing oil and natural gas production. This 
experience provides a strong foundation for the injection and 
monitoring technologies that will be needed for commercial-scale CCS. 
U.S. experience with ER combined with the experience of four end-to-end 
commercial CCS projects \6\ and ongoing research, demonstration, and 
deployment programs throughout the world, are building confidence that 
geologic sequestration of large amounts of CO2 can be 
achieved.
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    \5\ Dooley, JJ, CL Davidson, RT Dahowski. 2009. ``An Assessment 
of the Commercial Availability of Carbon Dioxide Capture and Storage 
Technologies as of June 2009.'' Joint Global Change Research 
Institute. Pacific Northwest National Laboratory. PNNL-18520.
    \6\ These projects are: Sleipner (Norwegian North Sea)--1 Mt 
CO2/yr injected since 1996; Weyburn (Canada)--1 Mt 
CO2/yr injected since 2000; In Salah (Algeria)--1.2 Mt 
CO2/yr injected since 2004; and Snohvite (Norwegian 
Barents Sea)--0.7 Mt CO2/yr injected since 2008.
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C. Overview of the Proposal

    Today, EPA is proposing to amend the Mandatory Reporting of 
Greenhouse Gases Program at 40 CFR part 98 to add reporting 
requirements covering facilities that conduct injection and geologic 
sequestration of CO2.
    EPA is proposing a tiered approach for reporting requirements under 
this subpart. The first tier of proposed regulations would establish a 
set of reporting requirements that would cover all facilities that 
inject CO2 underground. As described in Section II.C of this 
preamble, all facilities would be required to report CO2 
transferred onsite from offsite sources, the source of the 
CO2 (if known), and CO2 injected underground.
    The second tier of reporting requirements would apply to GS 
facilities. As described in Section II.C of this preamble, GS 
facilities would be required to calculate CO2 sequestered by 
subtracting total CO2 emissions from the CO2 
injected in the reporting year. The emitted quantity would include the 
injected CO2 that leaked from the subsurface to the surface 
(if any), CO2 produced with oil or natural gas where ER 
operations are conducted at the GS facility, fugitive or vented 
CO2 emissions from surface equipment, and emissions from 
combustion sources located within the facility boundary, such as 
compressors.
    EPA considered several options for monitoring, reporting and 
verification (MRV) of potential CO2 leakage \7\ at GS sites: 
do not require a MRV plan, require a universal MRV plan that applies to 
all GS sites, or require a site-specific MRV plan. EPA is proposing to 
require monitoring according to a site-specific MRV plan, but is 
seeking comment on all of the options considered. While the risk of 
leakage at a well-selected and well-managed GS site is expected to be 
low, the Agency considers it important for all facilities conducting GS 
to demonstrate that they have met MRV standards. The options described 
above are discussed in more detail in Section II.D of this preamble.
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    \7\ Leakage in this proposed rule is defined as the movement of 
CO2 from the injection zone to the surface (for example 
to the atmosphere, indoor air, oceans or surface water).
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    Data on CO2 injection and GS are critical to informing 
CAA GHG policies. This data would provide information and transparency 
on the amount of CO2 injected and geologically sequestered 
in the United States and, in combination with other subparts of the 
MRR, would enable EPA to track the flow of CO2 across a CCS 
system. In addition, this information would enable EPA to monitor the 
growth and efficacy of GS (and therefore CCS) as a GHG mitigation 
technology over time and to evaluate relevant policy options. For 
example, EPA would be able to track whether incentives or regulations 
are needed to encourage faster or further GS project development. EPA 
would also be able to track whether ER sites are reporting GS and 
consider whether incentives or regulations are needed. Where ER 
facilities are reporting GS, EPA would be able to evaluate ER as a 
potentially non-emissive end use. In combination with subpart PP, EPA 
would be able to reconcile this data with CO2 supplied in 
order to better understand the quantity of CO2 supplied to 
emissive and non-emissive end uses. Furthermore, this data would inform 
Agency policy decisions under CAA sections 111 and 112 related to the 
use of CCS for mitigating GHG emissions.
    In developing this proposal, EPA considered overlap between this 
program and other programs. In July 2008, EPA proposed to amend its UIC 
program to establish a new class of injection well for GS projects (73 
FR 43492 (July 25, 2008)). Today's proposal provides a pathway for 
CO2 injection facilities to report to EPA as GS facilities 
under the CAA, regardless of their UIC permit classification. Under 
this proposal, any facility sequestering CO2 underground can 
choose to qualify and report as a GS facility for purposes of this 
proposed rule.
    Since subpart RR is an amendment to the MRR, the general provisions 
of the MRR (40 CFR part 98, subpart A) apply to today's proposed 
subpart RR unless a provision is superseded by this subpart that 
applies uniquely to facilities that inject CO2 or that 
conduct GS. The general provisions address the following topics: The 
purpose and scope (40 CFR 98.1); who must report (40 CFR 98.2); the 
general monitoring, reporting, recordkeeping and verification 
requirement (40 CFR 98.3); the authorization and responsibilities of 
the designated authority (40 CFR 98.4); how a report is submitted (40 
CFR 98.5); definitions (40 CFR 98.6); the standardized methods 
incorporated by reference (40 CFR 98.7); the compliance and enforcement 
provisions (40 CFR 98.8); and the mailing addresses (40 CFR 98.9).
    Amendments to the General Provisions. In a separate rulemaking, 
package that was recently published (March 16, 2010), EPA issued minor 
harmonizing changes to the general provisions for the GHG reporting 
rule (40 CFR part 98, subpart A) to accommodate the addition of source 
categories not included in the 2009 final rule (e.g., subparts proposed 
in April 2009 but not finalized in 2009, any new subparts that may be 
proposed in the future). The changes update 98.2(a) on rule 
applicability and 98.3 regarding the reporting schedule to accommodate 
any additional subparts and the schedule for their reporting 
obligations (e.g., source categories finalized in 2010 would not begin 
data collection until 2011 and reporting in 2012).
    In particular, we restructured 40 CFR 98.2(a) to move the lists of 
source categories from the text into tables. A table format improves 
clarity and facilitates the addition of source categories that were not 
included in calendar year 2010 reporting and would begin reporting in 
future years. A table, versus list, approach allows other sections of 
the rule to be updated automatically when the table is updated; a list 
approach requires separate updates to the various list references each 
time the list is changed. In addition to reformatting the 98.2(a)(1)-
(2) lists into tables, other sections of subpart A were reworded to 
refer to the source category tables because the tables make it clear 
which source categories are to be considered for determining the 
applicability threshold and reporting requirements for calendar years 
2010, 2011, and future years.

[[Page 18580]]

    As part of today's proposed rule, EPA is proposing changes to 
subpart A to accommodate subpart RR. Because all CO2 
injection and geologic sequestration facilities (as defined in proposed 
40 CFR part 98, subpart RR) would be subject to proposed subpart RR, 
EPA is proposing that this source category be added to the table of 
``all-in'' source categories referenced from 40 CFR 98.2(a)(1).\8\ For 
facilities that become subject to the MRR due to CO2 
injection or geologic sequestration, the first annual GHG report would 
cover calendar year 2011 rather than 2010.
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    \8\ Since we changed the list of covered subcategories to 
tables, we are not providing regulatory text in this proposal 
because the preamble is clear.
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    EPA is proposing to amend 40 CFR 98.2(a) so that the MRR applies to 
facilities located on or under the Outer Continental Shelf. These 
revisions are necessary to ensure that any CO2 injection or 
GS facilities located on or under the Outer Continental Shelf of the 
United States would be required to report. In addition, EPA is 
proposing revisions to the definition of United States to clarify that 
the United States includes the territorial seas. Other facilities 
located offshore of the United States covered by the MRR program at 40 
CFR part 98 would also be affected by this change in the definition of 
United States. For example, EPA is proposing in a separate rule to 
revise the MRR requirements to add a new subpart, subpart W, to address 
petroleum and natural gas systems. Any comments specific to that issue 
should be directed to the Agency in that rulemaking, not this one. 
Finally, in addition to the change to the definition of United States, 
EPA is adding a definition of ``Outer Continental Shelf.'' This 
definition is drawn from the definition in the U.S. Code. Together, 
these changes make clear that the MRR applies to facilities on land, in 
the territorial seas, or on or under the Outer Continental Shelf of the 
United States, and that otherwise meet the applicability criteria of 
the MRR.
    EPA also is proposing to amend 40 CFR 98.7 (incorporation by 
reference) to include standard methods used in proposed subpart RR.

D. Legal Authority

    EPA is proposing subpart RR under the existing authority provided 
in CAA section 114. As noted in the MRR, CAA section 114 provides EPA 
with broad authority to require information mandated by this rule 
because such data will inform and are relevant to EPA's carrying out a 
wide variety of CAA provisions (74 FR 66264). Under CAA section 
114(a)(1), the Administrator may require emissions sources, persons 
subject to the CAA, or persons whom the Administrator believes may have 
necessary information to monitor and report emissions and provide such 
other information as the Administrator requests for the purposes of 
carrying out the provisions in the CAA (except for a provision of title 
II with respect to motor vehicles).
    As discussed in greater detail in the response to comments for the 
final MRR, the CAA provides EPA with broad authority to require the 
comprehensive and accurate information mandated in this rule because 
such data will inform, and are relevant to, EPA's analyses of various 
CAA provisions (Mandatory Reporting of Greenhouse Gases, EPA's Response 
to Public Comment's Section 3-Legal Issues). EPA may gather information 
for a variety of purposes, including for the purpose of assisting in 
the development of implementation plans or of emissions standards under 
CAA section 111, determining compliance with implementation plans or 
such standards, or more broadly for ``carrying out any provision'' of 
the CAA. In addition, CAA section 103 authorizes EPA to establish a 
national research and development program, including non-regulatory 
approaches and technologies for the prevention and control of air 
pollution as it relates to GHGs and climate change.
    The information from CO2 injection and GS facilities 
will allow EPA to make well-informed decisions about whether and how to 
use the CAA to regulate these facilities and encourage voluntary 
reductions.

E. Relationship to the Proposed UIC Class VI Rulemaking Under the Safe 
Water Drinking Act

    The Agency maintains a high-level of coordination across EPA 
offices and regions on GS activities and regulatory development. EPA's 
Office of Air and Radiation (OAR) and Office of Water (OW) work closely 
to promote safe and effective implementation of GS technologies while 
ensuring protection of human health and the environment. All Agency 
efforts related to GS, including the UIC Class VI proposal which is 
discussed in more detail below, and this MRR proposal, are closely 
coordinated.
    EPA's UIC program was established in the 1970s to prevent 
endangerment of underground sources of drinking water (USDWs) from 
injection of various fluids, including CO2 for ER, oil field 
fluids, water stored for drinking water supplies, and municipal and 
industrial waste. The UIC program, which is authorized by Part C of the 
Safe Drinking Water Act (SDWA) (42 U.S.C. 300h et seq.), is designed to 
prevent the movement of such fluid into USDWs by addressing the 
potential pathways through which injected fluids can migrate and 
potentially endanger USDWs.
    When EPA initially promulgated its UIC program regulations, the 
Agency defined five classes of injection wells at 40 CFR 144.6, based 
on similarities in the fluids injected, construction, injection depth, 
design, and operating techniques. Wells injecting industrial non-
hazardous liquids, municipal wastewaters or hazardous wastes beneath 
the lowermost USDW are categorized as Class I. Those injecting fluids 
in connection with conventional oil or natural gas production, enhanced 
oil and gas production, and the storage of hydrocarbons which are 
liquid at standard temperature and pressure are categorized as Class 
II. Class III wells inject fluids associated with the extraction of 
minerals, and those categorized as Class IV inject hazardous or 
radioactive wastes into or above USDWs. Class IV injection wells are 
banned unless authorized under an approved Federal or State ground 
water remediation project. Class V includes all injection wells that 
are not included in Classes I-IV. This well class provides for Class V 
experimental technology wells including those permitted as GS pilot 
projects.\9\
---------------------------------------------------------------------------

    \9\ See EPA UIC Guidance 83. Available at: http://www.epa.gov/safewater/uic/wells_sequestration.html.
---------------------------------------------------------------------------

    In 2008, EPA proposed to amend the UIC program to establish a new 
class of injection well--Class VI--to cover the underground injection 
of CO2 for the purpose of GS, or long-term storage of 
CO2 (73 FR 43492, July 25, 2008). The proposed requirements 
would tailor existing components of the UIC program to address the 
unique nature of GS projects so as to ensure that the injection of 
large volumes of CO2 in a variety of geologic formations for 
the purposes of long term storage would not endanger USDWs. The UIC 
Class VI proposal does not require any facilities to capture and/or 
sequester CO2; rather the proposed requirements, if 
finalized, would protect USDWs under the SDWA. The SDWA does not 
provide authority to develop regulations for all areas related to GS 
such as capture or transport. As outlined in the UIC Class VI proposal, 
injection wells used for injecting CO2 for the purposes of 
ER would continue to be regulated and permitted as Class II as long as 
any

[[Page 18581]]

production is occurring. EPA received significant comments on this 
proposed approach and is currently evaluating these comments for the 
final rulemaking.
    Facilities regulated under the UIC program are required to collect 
and report data, with minimum requirements for the collection and 
reporting of data established at the Federal level. Where States are 
given primacy over the UIC program, the data collected under the UIC 
program varies. Data currently collected under a State-issued UIC 
permit is submitted to States while, under today's subpart RR proposal, 
reporters will be submitting data directly to EPA. The Agency believes 
that State, local, and tribal input is valuable in ensuring that the 
subpart RR reporting requirements appropriately build on the UIC 
program requirements. EPA is seeking comment on a number of topics and 
will look for opportunities to conduct outreach with State, local and 
tribal organizations between proposal and finalization.
    Today's proposal builds on the UIC program requirements for 
monitoring with the additional goals of verifying the amount of 
CO2 sequestered and collecting data on CO2 
surface emissions from GS facilities. As described in Section II.D of 
this preamble, EPA is proposing that a facility's UIC permit may be 
used to demonstrate that certain MRV plan requirements have been 
fulfilled.
    In the Agency's August 2009 Notice of Data Availability 
supplementing the UIC Class VI proposal, EPA noted that it was 
evaluating the need for a more comprehensive regulatory framework for 
GS. The Agency acknowledges that regulatory clarity is essential for 
enabling GS to move forward in a manner that protects human health and 
the environment. It is EPA's intention to coordinate GS requirements 
across relevant statutory or other programs in order to minimize any 
redundancies and increase clarity for stakeholders. The Agency seeks 
comment on whether this is appropriate.
    The proposed UIC Class VI rule is a separate rulemaking action; the 
comment period for that rulemaking closed on December 24, 2008. EPA 
will not be accepting or responding to comments on the proposed UIC 
Class VI rule through today's proposal unless related to a specific 
issue raised by this action.

F. Relationship to Other CO2 Injection Information 
Collection and Reporting Efforts

    In considering how to design this proposal, EPA reviewed and took 
into account other domestic and international reporting and monitoring 
programs. Key programs are summarized in this section.
    The Department of Energy (DOE) Energy Information Administration 
implements a voluntary GHG reporting program under section 1605(b) of 
the Energy Policy Act of 1992, which directed DOE to issue guidelines 
establishing a voluntary greenhouse gas reporting program (42 U.S.C. 
13385(b)). Under the Energy Information Administration's ``1605(b) 
program,'' reporters can choose to prepare an entity-wide GHG inventory 
and identify specific GHG reductions made by the entity.\10\ Reporting 
tools were revised and published in 2009 to assist entities in 
preparing a preliminary estimate of emissions. The 2007 updated 1605(b) 
guidance outlines a voluntary process to report data on CO2 
sequestration. Currently, no CO2 injection or sequestration 
entity has reported under the 1605(b) program per the 2007 guidelines. 
According to the Energy Information Administration Web site, the first 
reporting cycle under the revised Voluntary Reporting of Greenhouse 
Gases Program has not been completed as of January 15, 2010. The Energy 
Information Administration anticipates issuing an annual report and 
public use database for data reported through 2008 by early 2010.\11\ 
The 1605(b) guidance requires the implementation of a site-specific 
monitoring plan, but this plan is not evaluated by DOE to determine 
whether the plan will provide for appropriate monitoring. Four 
prescriptive monitoring scenarios are offered with grades ranging from 
``A'' to ``C'', any of which would be acceptable for compliance with 
the 1605(b) program. Furthermore, although the 1605(b) guidance cites 
the importance of reporting CO2 leakage should it occur, the 
guidance does not include a discussion of, procedures for, or 
methodologies for using monitoring technologies and techniques to 
quantify the leakage. As a result of this, and the fact that reporting 
is voluntary, the 1605(b) program would not meet the data needs of this 
proposed rule.
---------------------------------------------------------------------------

    \10\ Under the 1605(b) program an ``entity'' is defined as ``the 
whole or part of any business, institution, organization or 
household that is recognized as an entity under any U.S. Federal, 
State or local law that applies to it; is located, at least in part, 
in the U.S.; and whose operations affect U.S. greenhouse gas 
emissions.'' Available at: http://www.pi.energy.gov/enhancingGHGregistry.
    \11\ Available at: http://www.eia.doe.gov/oiaf/1605/data_reports.html.
---------------------------------------------------------------------------

    The Internal Revenue Service (IRS) made public IRS Notice 2009-83 
Credit for Carbon Dioxide Sequestration under section 45Q on its Web 
site on October 8, 2009.\12\ The notice provides procedures for the 
allocation of credits for CO2 sequestration under section 
45Q of the Internal Revenue Code. Section 45Q was enacted by section 
115 of the Energy Improvement and Extension Act of 2008, (October 3, 
2008) and was amended by section 1131 of the American Recovery and 
Reinvestment Act of 2009 (February 17, 2009). To claim this credit, a 
taxpayer must follow general monitoring and verification principles, 
calculate CO2 sequestered in the fiscal year using a mass-
balance equation, and report to IRS the amount of qualified 
CO2 sequestered in the fiscal year. Seventy-five million 
metric tons of qualified CO2 can be taken into account for 
this credit. The IRS included a provision in the notice to supersede 
its monitoring and verification procedures and requirements with 
procedures and requirements finalized by EPA in future GS rulemaking 
such as the UIC Class VI proposal and this proposed rule.
---------------------------------------------------------------------------

    \12\ Available at: http://www.irs.gov/irb/2009-44_IRB/ar11.html.
---------------------------------------------------------------------------

    EPA has concluded for a number of reasons that the IRS data would 
not meet the needs outlined in this proposed rule. First, the IRS 
reporting requirement will expire after 75 million metric tons of 
CO2 is reported as sequestered to IRS, at which point the 
data collection will end. Second, the level of reporting and 
transparency would not meet the verification needs of this proposed 
rule. GS facilities only report the quantity of CO2 
sequestered to IRS. The data used to calculate sequestration and the 
specific monitoring procedures followed will only be reviewed by IRS 
staff in the case of an audit. Given the variability in geology and 
other conditions at GS facilities, EPA believes that the monitoring 
approach at each GS facility must be reviewed on a case-by-case basis 
to ensure that it is appropriate for the site-specific geologic and 
operational conditions. Third, the IRS does not outline procedures or 
provide a mechanism for quantifying and reporting any CO2 
leakage that may occur as is necessary for this proposed rule.
    EPA notes that the United States submits an inventory of GHG 
emissions that accounts for CCS to the Secretariat of the United 
Nations Framework Convention on Climate Change (UNFCCC) each year. The 
UNFCCC, ratified by the United States in 1992, establishes an overall 
framework for intergovernmental efforts to tackle the

[[Page 18582]]

challenge posed by climate change. The United States has submitted the 
Inventory of U.S. Greenhouse Gas Emissions and Sinks (Inventory) to the 
United Nations every year since 1993. The annual Inventory is 
consistent with national inventory data submitted by other UNFCCC 
parties, and uses internationally accepted methods for its emission 
estimates. For more information about the Inventory, please refer to 
the following Web site: http://www.epa.gov/climatechange/emissions/usinventoryreport.htm.
    The United States currently follows the 1996 \13\ Intergovernmental 
Panel of Climate Change (IPCC) guidelines in preparing its Inventory, 
as supplemented by IPCC Good Practice Guidance (GPG) from 2000 \14\ and 
2003 \15\. Since these guidelines do not provide information on the 
accounting of GS, EPA addressed CO2 usage in the 2007 
Inventory by accepting some general, top-down assumptions about the 
end-use of supplied CO2. First, EPA collected CO2 
production data for natural CO2 domes and estimated for each 
dome the amount of CO2 used for ER operations and the amount 
of CO2 used for non-ER operations. EPA assumed that the 
percentage of naturally produced CO2 used for non-ER 
operations (e.g., food processing, chemical production) was all emitted 
to the atmosphere. The percentage used for ER operations was assumed to 
be sequestered. Second, EPA collected data from industry on 
anthropogenic CO2 emitted from natural gas processing and 
ammonia plants and accounted it as emitted, regardless of whether the 
CO2 was captured or not.
---------------------------------------------------------------------------

    \13\ IPCC, 1996. ``Revised 1996 IPCC Guidelines for National 
Greenhouse Gas Inventories.'' National Greenhouse Gas Inventories 
Programme. Available: http://www.ipcc-nggip.iges.or.jp/public/gl/invs1.html.
    \14\ IPCC. 2000. ``Good Practice Guidance and Uncertainty 
Management in National Greenhouse Gas Inventories.'' National 
Greehouse Gas Inventories Programme. Available at: http://www.ipcc-nggip.iges.or.jp/public/gp/english/.
    \15\ IPCC. 2003. ``Good Practice Guidance for Land Use, Land-Use 
Change, and Forestry.'' National Greenhouse Gas Inventories 
Programme. Available at: http://www.ipcc-nggip.iges.or.jp/public/gpglulucf/gpglulucf.html.
---------------------------------------------------------------------------

    The IPCC published new inventory guidelines in 2006 \16\, which 
directly address accounting for GS and include methodologies for the 
estimation of emissions from capture, transport, injection, and GS of 
CO2. The guidelines are based on the principle that the CCS 
system should be accounted for in a complete and consistent manner 
across the entire Inventory. The approach accounts for CO2 
produced from natural CO2 domes and captured at industrial 
facilities as well as emissions from capture, transport, and use. For 
GS specifically, the IPCC guidelines outline a Tier 3 methodology \17\ 
for estimating and reporting emissions based on site-specific 
evaluations of each storage site. EPA believes that the GS monitoring, 
reporting, and verification requirements of this proposed rule are 
consistent with the 2006 IPCC guidelines.
---------------------------------------------------------------------------

    \16\ 2006 IPCC Guidelines for National Greenhouse Gas 
Inventories: Volume 2--Energy. Chapter 5 Carbon Dioxide Transport, 
Injection, and Geological Storage. Available at: http://www.ipcc-nggip.iges.or.jp/public/2006gl/index.htm.
    \17\ Tier 3 methods include either detailed emission models or 
measurements and data at individual plant level where appropriate.
---------------------------------------------------------------------------

    In considering how to design this proposal, EPA also took into 
account the monitoring requirements adopted in other countries, in 
particular other UNFCCC member countries that have already taken steps 
towards collecting information for CCS to meet the 2006 IPCC 
guidelines. The Directive of the European Parliament and of the Council 
on the geological storage of carbon dioxide (Commission decision 2007/
589/EC) establishes a legal framework for the environmentally safe 
geological storage of CO2. It requires European Council (EC) 
member States to ensure that each GS site operator will carry out 
monitoring of the injection facilities, the storage complex (including 
the CO2 plume), and, where appropriate, the surrounding 
environment for detection of any significant migration or leakage of 
CO2 or any significant adverse effect on the surrounding 
environment.
    The directive requires that monitoring frequency be determined by 
the competent authority, and should be at least once a year. A 
monitoring report should be developed that describes the quantities and 
properties of the CO2 streams delivered and injected, 
including concentration of the CO2 streams, in the reporting 
period. The parameters to be monitored include:
     Fugitive emissions of CO2 at the injection 
facility;
     CO2 volumetric flow at injection wellheads;
     CO2 pressure and temperature at injection 
wellheads (to determine mass flow);
     Chemical analysis of the injected material; and
     Reservoir temperature and pressure (to determine 
CO2 phase behavior and state).
    Per the directive, each GS site should choose monitoring technology 
based on best practices available at the time the monitoring plan is 
designed. The following options should be considered and used when 
appropriate:
     Technologies that can detect the presence, location, and 
migration paths of CO2 in the subsurface and at the surface;
     Technologies that provide information about pressure-
volume behavior and aerial/vertical distribution of CO2-
plume to refine numerical 3-D-simulation to the 3-D-geological models 
of the storage formation; and
     Technologies that can provide a wide aerial spread in 
order to capture information on any previously undetected potential 
leakage pathways across the aerial dimensions of the complete storage 
complex and beyond, in the event of significant irregularities or 
migration of CO2 out of the storage complex.
    In Australia, the Proposed Greenhouse Gas Geological Sequestration 
Regulations 2009 were proposed to support the implementation and 
administration of the Greenhouse Gas Geological Sequestration Act 2008 
and to address several CCS related issues, including monitoring 
requirements for GS. These regulations require that each GS site 
develop a monitoring and verification plan which includes the 
following:
     Characteristics of the geological formation into which the 
GHG substance is to be injected and any geological or other conditions 
that may influence containment of a stored GHG;
     A description of the existing environment above, on and 
below the surface of the ground; and any resource above, on and below 
the surface of the ground that a person is entitled to extract or use 
under a resource authority;
     Details of the equipment proposed to be used to monitor 
the behavior of stored greenhouse gas substances, and where it is to be 
located;
     Details of the techniques to be used to monitor, the 
length of time that each technique is to be used, and how often each 
monitoring technique is to be carried out; and
     The regulation also specifies that a report on the outcome 
of all monitoring and verification activities carried out should be 
completed quarterly.
    Other international efforts have also been useful to EPA in 
developing the requirements of this proposed rule. The International 
Maritime Organization (IMO) has published under the London Protocol 
\18\ two documents to provide guidelines to parties for the assessment 
of and implementation of disposal of CO2 in sub-seabed 
geologic formations:

[[Page 18583]]

Specific Guidelines for Assessment of Carbon Dioxide Streams for 
Disposal into Sub-Seabed Geological Formations (2009) and Risk 
Assessment and Management Framework for CO2 Sequestration in 
Sub-Seabed Geological Structures (2007). These guidelines focus on 
several aspects of CCS including:
---------------------------------------------------------------------------

    \18\ Available at: http://www.imo.org/includes/blastData.asp/doc_id=10531/9%20%20CO2%20Sequestration%20English.pdf.
---------------------------------------------------------------------------

     CO2 stream characterization (chemical and 
physical properties);
     Waste prevention audit;
     Consideration of waste management options;
     Action lists;
     Identification and characterization of sub-seabed 
geological formation;
     Assessment of potential impacts;
     Monitoring and risk management; and
     Permitting and permit condition.
    Under the Kyoto Protocol, the Clean Development Mechanism (CDM) is 
a market-based mechanism that aids countries in meeting their emission 
limitation and reduction goals through emission reduction (or removal) 
projects in developing nations. These projects allow companies in 
industrialized countries to receive credits that can either be put 
towards their emission limitation or reduction, traded, or sold. Two 
new proposed CDM methodologies (NM0167 and NM0168) address CCS 
activities.\19\ These new baseline and monitoring methodologies have 
not yet been approved by the CDM Executive Board, but EPA continues to 
follow their progress and to monitor for other GS methodology 
proposals.
---------------------------------------------------------------------------

    \19\ Available at: http://cdm.unfccc.int/about/ccs/index.html.
---------------------------------------------------------------------------

II. Rationale for Reporting, Recordkeeping, and Verification 
Requirements

A. Definition of Reporting Facilities

1. CO2 Injection Facility
    EPA is proposing that the CO2 injection facility be 
defined broadly to cover wells or a group of wells that inject 
CO2 into the subsurface or sub-seabed geologic formations. 
This definition would encompass both onshore and offshore facilities.
    EPA is proposing a broad definition of CO2 injection 
facility to ensure complete reporting of basic information regarding 
the CO2 transferred onsite, the source of the CO2 
if known, and the CO2 injected. The broad definition also 
provides reporters with flexibility either to report this basic 
information on a well by well basis or to group wells in an area for 
reporting purposes. Given the proposed threshold and applicability for 
CO2 injection facilities, a more specific definition 
addressing the aggregation of groups of wells in an area is not 
necessary. As discussed in more detail in Section II.B of this 
preamble, however, EPA is soliciting comment on the question of how to 
define the source category if a more precise definition is necessary.
2. GS Facility
    EPA is proposing facilities injecting CO2 for the long-
term containment in subsurface geologic formations would meet the 
definition of GS in this proposed rule and would report additional 
information. EPA is proposing that facilities that inject 
CO2 for ER would not be GS facilities unless they inject 
CO2 for the long-term containment in subsurface geologic 
formations and submit and gain EPA approval of an MRV plan.
    To comply with the specific reporting requirements discussed in 
Section II.C of this preamble, the reporter would need to identify the 
sources and surface equipment making up the GS facility. However, EPA 
recognizes that defining the extent of a GS facility source may be 
difficult. For example, there may be a number of injection wells in an 
oilfield under common ownership or common control of which only a 
subset would be considered GS facilities. In that example, the question 
of whether and how to aggregate various wells arises. In addition, the 
CO2 plume and pressure front associated with a GS facility 
may extend for a distance beyond the injection point, and widely 
separated wells may be injecting into the same pore space. Because EPA 
is seeking data on the amount of CO2 sequestered by these 
facilities and because EPA is proposing an all-in threshold for these 
facilities, EPA is proposing a narrow definition of GS source to 
simplify the reporting requirements associated with emissions from 
combustion and surface equipment. For purposes of this reporting rule, 
EPA is proposing to define a GS facility to include all structures 
associated with the injection of CO2 located between the 
points of CO2 transfer onsite from offsite and the injection 
well (or wells). A GS facility that injects CO2 to enhance 
the recovery of oil or natural gas will also include all structures 
associated with production located between the production wells and the 
separators.
    Although EPA is proposing a narrow definition of GS facility, the 
proposed rule would require GS facilities to monitor over a spatial 
area that will almost certainly extend beyond the boundaries of the 
facility, as defined here. Given that a main focus of this proposal is 
to obtain information regarding the efficacy of GS, EPA anticipates 
that the MRV plans for GS facilities will need to require monitoring 
over a broad area. This is discussed in Section II.D of this preamble.
    EPA seeks comment on its approach to defining the boundary of the 
GS facility. In particular, EPA seeks comment on the question of 
whether EPA should require the aggregation of wells located in an area, 
and if so, what rules should be applied for determining what equipment 
comprises the source. EPA seeks comment on whether the GS facility 
should be defined to include the spatial area of monitoring proposed in 
Section II.D of this preamble. EPA also seeks comment on whether it 
should follow the approach for onshore facilities in the proposed 
subpart W regulations, which requires the aggregation of equipment to 
the geographic boundary of a single hydrocarbon basin as defined by the 
American Association of Petroleum Geologists.
    EPA is proposing to exempt research and development (R&D) as 
defined at 40 CFR Part 98.6 from subpart RR, consistent with the 
approach taken in subparts C through QQ of the MRR. EPA is also 
proposing that, for the purposes of GS facility requirements under 
subpart RR, research and development means those projects receiving 
Federal funding to research practices and monitoring techniques that 
will enable safe and effective long-term containment of a gaseous, 
liquid, or supercritical CO2 stream in subsurface geologic 
formations. R&D projects would not be required to submit an MRV plan 
under subpart RR. EPA seeks comment on how R&D projects are defined and 
treated in this proposal.
3. Other CO2 End-Users
    In developing this proposed rule, EPA considered requiring 
reporting from various other end-users of the CO2 that is 
produced and supplied to the economy, including both emissive and 
potentially non-emissive applications. EPA considered but is not 
proposing requiring reporting from these other end-users; EPA has 
concluded that collecting information pursuant to subpart PP on 
CO2 supplied to the economy will provide EPA with the 
necessary data on emissive volumes while minimizing the number of 
facilities impacted by this rule. EPA seeks comment on this conclusion. 
The Agency also seeks comment on whether applications, such as 
precipitated calcium carbonate and some cement production, permanently 
sequester CO2 and if so, which industries this would 
include; how many facilities operate in

[[Page 18584]]

each of these industries; how much of the CO2 consumed in 
each industry would be sequestered; whether a sequestration factor 
would be reasonable in any case; and what methodologies could be used 
to verify this sequestration.

B. Selection of Reporting Thresholds

    To determine the appropriate threshold for reporting under subpart 
RR, EPA considered both a threshold based on the amount of 
CO2 emitted and a threshold based on the amount of 
CO2 injected underground. EPA concluded that an emissions-
based threshold would be problematic because of the lack of data on the 
incidence and scale of surface emissions and leakage from injection and 
GS of facilities. EPA seeks comment on how the Agency could determine 
an emissions-based threshold and detailed data underlying such an 
approach. EPA accordingly analyzed injection facilities based on the 
quantity of CO2 injected underground and considered whether 
an injection threshold should apply. EPA evaluated a no threshold 
option (i.e., all facilities that inject CO2 would be 
required to report), 1,000 metric tons per year, 10,000 metric tons per 
year, 25,000 metric tons per year, and 100,000 metric tons per year per 
facility of CO2 injected.
    To establish a count of CO2 injection facilities, EPA 
relied on data reported in the Oil and Gas Journal (O&GJ) Enhanced Oil 
Recovery Survey published in April 2008 (Volume 106, Issue 15). EPA 
compiled all the projects listed for miscible and immiscible 
CO2 floods \20\ reported in the O&GJ survey. A total of 105 
active ER projects were reported. In some cases multiple projects were 
conducted by the same company in an oil field. For the purposes of this 
analysis, EPA grouped these reported projects by field and by owner or 
operator to align with typical industry practices for reporting project 
information to State oil and gas commissions. This computation results 
in eighty facilities for the facility count.
---------------------------------------------------------------------------

    \20\ A miscible CO2 flood injects CO2 as a 
liquid at high pressure to completely mix with oil and make it flow 
more easily. An immiscible CO2 flood uses lower pressures 
of CO2 to swell the oil and provide additional gas 
pressure to move the oil.
---------------------------------------------------------------------------

    The O&GJ survey does not provide the specific volume of 
CO2 used in each of the active ER projects. To calculate the 
estimated volume of CO2 injected at each ER project, EPA 
took the total amount of CO2 used daily for ER, as reported 
by the U.S. EPA in the Draft 1990-2007 Inventory of U.S. Greenhouse Gas 
Emissions and Sinks,\21\ apportioned it to each ER project according to 
an average value for the fractional production of oil attributed to ER 
using CO2 as presented in the O&GJ survey, and normalized 
the amount of CO2 injection on an annual basis. EPA 
recognizes that this is likely an oversimplification of the actual 
injection volumes used at each facility and is seeking comment on 
whether it is reasonable to rely on the principle that higher 
production is a function of higher CO2 injection volumes. If 
a different analytical approach would be more appropriate, EPA seeks 
detailed recommendations on the alternative approach as well as 
additional data that would enable EPA to conduct a more comprehensive 
analysis.
---------------------------------------------------------------------------

    \21\ U.S. EPA Draft Inventory of U.S. Greenhouse Gas Emissions 
and Sinks, 1990-2007, Draft Report, EPA 430-R-09-004. Available at: 
http://epa.gov/climatechange/emissions/usinventoryreport.html.
---------------------------------------------------------------------------

    The results of the threshold analysis are presented in Table 3 of 
this preamble. For further information on the assumptions underlying 
the threshold analysis, please refer to the general technical support 
document (TSD) for this proposal.\22\
---------------------------------------------------------------------------

    \22\ Subpart RR General TSD (see docket ID No. EPA-HQ-OAR-2009-
0926).

     Table 3--CO2 Injection Facilities: Effect of Injection Threshold on Reported Amount of CO2 Injected and Number of Facilities Required To Report
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                    Reported amount of CO2        Number of facilities
                                                                 Total estimated      Total                injected                required to report
       Threshold level (metric tons/yr of CO2  injected)         national (metric   number of  ---------------------------------------------------------
                                                                  tons/yr of CO2       U.S.     Metric tons/yr of    Percent                   Percent
                                                                    injected)       facilities     CO2 injected      covered       Number      covered
--------------------------------------------------------------------------------------------------------------------------------------------------------
All In........................................................         40,111,639           80         40,111,639        100.0           80        100.0
1,000.........................................................         40,111,639           80         40,111,115        100.0           74         92.5
10,000........................................................         40,111,639           80         40,099,065        100.0           71         88.8
25,000........................................................         40,111,639           80         40,005,238        100.0           65         81.3
100,000.......................................................         40,111,639           80         39,065,039         97.4           48         60.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The analysis shown in Table 3 of this preamble suggests that nearly 
all injection data can be collected from roughly half of operating 
facilities at an injection threshold of 100,000 metric tons/yr of 
CO2 injected. EPA considered establishing an injection 
threshold of 100,000 metric tons/yr of CO2 injected. 
However, a low CO2 injection or production quantity in one 
year is not a reliable prediction of the quantity that may be injected 
in the following year or in a year of full-scale operation. For 
example, six of the eighty facilities reported zero or near zero 
production and therefore did not exceed the 1,000 metric tons threshold 
as shown in Table 3 of this preamble. However, these six facilities may 
inject over this threshold in the following year. In addition, more 
than 40 of the 105 projects in this analysis were described in the OG&J 
survey as ``just started'' or pilot projects, indicating that they may 
not be at fully operational levels of CO2 injection. Given 
the variability of CO2 injection rates, EPA is proposing 
that all facilities report irrespective of injection or production 
quantities in the reporting year.
    EPA is proposing that all CO2 injection facilities would 
be required to report the minimum information in subpart RR (quantity 
of CO2 injected, quantity of CO2 transferred 
onsite from offsite, and source of the CO2 if known) at no 
threshold. An all-in reporting threshold would allow the Agency to 
comprehensively track all CO2 supply (as reported in 
Suppliers of CO2, subpart PP) that is injected underground. 
This approach is consistent with the all-in requirements in the MRR for 
suppliers of petroleum, natural gas, and coal-to-liquid products 
(subparts LL, MM, and NN), producers of industrial gases (subpart OO), 
and suppliers of CO2 (subpart PP). It was reasonable to 
require all of the facilities in these source categories to report 
because it would result in the most comprehensive accounting possible, 
simplify the rule, and permit facilities to quickly determine whether 
or not they must

[[Page 18585]]

report; the same rationale applies for this source category proposed 
today. Furthermore, it would create a uniform burden for all covered 
facilities, ensuring a level playing field in, and preventing 
fragmentation of, the ER sector. EPA has estimated the cost for 
CO2 injection facilities to comply with the minimum 
reporting requirements in this proposed rule and has determined that 
the burden would be small, given the equipment and data collection 
efforts already in place at ER projects.
    EPA seeks comment on whether an all-in reporting threshold for 
injection facilities is appropriate or if a 100,000 metric tons/yr of 
CO2 injected or other threshold on quantity injected (e.g., 
1 million metric tons/yr of CO2 injected) should be applied, 
leveraging information collected through the UIC program. To apply a 
reporting threshold to injection facilities, EPA would need to more 
specifically define which wells should be grouped together to delineate 
an injection facility. One option would be to group wells together by 
field as EPA did with the OG&J data in this threshold analysis. This 
definition would not be appropriate for injection facilities that are 
not producing oil or gas, however, such as those injecting into saline 
formations or coal seams. A second option would be to group wells 
together by basin. This definition would not be appropriate for 
injection facilities that are not producing oil or gas, however, such 
as those injecting into saline formations or coal seams. A third option 
would be to group wells by UIC permit; an injection well would be 
delineated by individual well if permitted by UIC as such and by a 
group of wells if permitted by UIC as a group. This definition would 
not be appropriate for sub-seabed injection wells outside the 
jurisdiction of SDWA. A fourth option would be to define injection 
facility as one individual well. This definition could be impractical 
for injection facilities that operate hundreds of wells, however, such 
as some ER projects. EPA seeks comment on which of these options for 
delineating an injection facility, or any options not discussed, would 
be most appropriate in the case that a reporting threshold based on 
injection quantity is appropriate.
2. GS Facilities
    Under this action, EPA is proposing that the subset of 
CO2 injection facilities that are conducting GS (i.e., a GS 
facility) must report to EPA a second tier of data. EPA considered 
whether a threshold should apply to this second tier of data given that 
it would place a reporting burden on GS facilities. However, EPA could 
not perform an analysis on GS facilities based on emissions without 
data on actual or expected GS facility emissions. EPA also could not 
perform a threshold analysis based on injection due to the uncertainty 
around predictions of injection quantities for potential GS facilities. 
In addition, it is difficult to predict how many injection facilities 
would choose to report GS. Therefore, EPA is proposing to exempt GS R&D 
projects but otherwise require all GS facilities to comply with the GS 
monitoring, reporting, and verification requirements of subpart RR, and 
that they report fugitive, vented, and combustion emissions from 
surface equipment (under subpart W, RR, or C, as applicable). An all-in 
threshold will allow EPA to work with the early-movers of this nascent 
industry and to strengthen EPA's understanding of GS.
    EPA is seeking comment on the proposed injection-based threshold 
analysis approach and how the Agency might use an alternative threshold 
approach, such as an emissions-based threshold or risk-based threshold. 
The Agency is also seeking comment on whether the threshold analysis 
conducted for CO2 injection facilities could also be applied 
to GS and, if so, whether a 100,000 metric tons/yr of CO2 
injected or other threshold (e.g., 1 million metric tons/yr of 
CO2 injected) should be applied. The Agency requests 
supporting data which could be used to establish a threshold.

C. Selection of Data To Be Reported

    This section describes the data that injection facilities and GS 
facilities must report under subpart RR. The first tier of reporting 
requirements described is for all facilities that inject CO2 
underground. The second tier of reporting requirements described is for 
GS facilities only.
    The first tier has three proposed reporting requirements. First, 
EPA is proposing that all CO2 injection facilities report 
the mass of CO2 injected. This would be determined by the 
mass flow or volumetric flow and CO2 concentration of the 
CO2 stream injected. Facilities must use mass flow meters to 
accurately measure the mass of the CO2 injected or 
volumetric flow meters to accurately measure the volumetric flow of the 
CO2 injected. To minimize the purchase and installation of 
new equipment, facilities subject to the UIC program would be allowed 
to measure the mass or volume of CO2 injected with the flow 
meters installed for purposes of compliance with their UIC permits. EPA 
accordingly is proposing two methodologies for making these 
calculations, depending on whether the facility is using a volumetric 
or a mass flow meter. EPA is proposing this approach so that facilities 
can comply with these reporting requirements regardless of the type of 
flow meter already installed. In the case of a facility using a 
volumetric flow meter, EPA assumes that the facility can determine 
operating temperature and pressure, which would allow for the 
volumetric flow of CO2 to be converted from operating 
conditions to standard conditions and, using a density value for 
CO2 at standard conditions and the measured concentration of 
CO2 in the flow, determine the mass of CO2. EPA 
seeks comment on the assumption that facilities can determine operating 
temperature and pressure, and alternative approaches for determining 
the mass of CO2 using a volumetric flow meter where 
operating temperature and pressure cannot be determined.
    Facilities would measure the CO2 concentration by 
sampling and testing the injected stream at the flow meter. With this 
approach, the flow and the concentration would be measured at the same 
point in the system for maximized data accuracy. Accordingly, if the 
flow meter were installed at the compressor(s), then the concentration 
would be measured at the compressor(s). If the flow meter were 
installed at the well(s), then the concentration would be measured at 
the well(s). EPA recognizes that a facility with tens or hundreds of 
injection wells, all of which have flow meters already installed at the 
wellheads, may face a significant burden in testing concentration at 
each of those flow meters. EPA seeks comment on alternative locations 
other than the flow meter(s) where concentration of the CO2 
injected could be measured at decreased burden without decreasing 
accuracy. EPA also seeks comment on potential methodologies to estimate 
concentration of the flow injected if flow is measured elsewhere, such 
as apportioning the concentration of CO2 transferred onsite 
and the concentration of recycled CO2 to the quantities from 
each source.
    Second, EPA is proposing that all CO2 injection 
facilities report the mass of the flow transferred onsite from offsite 
to verify the mass of CO2 reported as injected. This would 
be determined by the mass flow or volumetric flow and CO2 
concentration of the flow transferred onsite from offsite. A subset of 
CO2 injection facilities--facilities conducting ER--inject a 
combination of new CO2 transferred onsite from offsite and 
old CO2 recycled from the operation. Therefore, EPA would 
use reported data on CO2 transferred onsite

[[Page 18586]]

from offsite to estimate the amount of CO2 recycled from ER 
operations.
    EPA is proposing that all CO2 injection facilities 
monitor the CO2 concentrations and mass flow or volumetric 
flow quarterly. The purpose of these measurements is to account for 
fluctuations in the CO2 concentration over the reporting 
year. EPA seeks comment on this proposal and on the level of burden 
this frequency of reporting requires for facilities following different 
frequency parameters for their UIC permit.
    Third, EPA is proposing that all CO2 injection 
facilities would report the source contracted to supply the 
CO2, if known. EPA would seek information on whether the 
CO2 was contracted from a natural source (i.e., produced 
from a natural CO2 dome) or an industrial source. If an 
industrial source, EPA would seek information on the type of source if 
known (captured at a power plant, pulp and paper mill, ethanol plant, 
natural gas processing facility, or other type of industrial source). 
This would allow EPA to track the movement of CO2 through a 
CCS system and any shift toward anthropogenic CO2 supply 
sources. Pipelines that carry CO2 to the CO2 
injection facility may contain a mix of CO2 from various 
sources. EPA recognizes that facilities may not know the source of 
CO2 that they purchase. Accordingly, EPA would require the 
data to be reported only if known. EPA seeks comment on the proposed 
approach for reporting the source contracted to supply the 
CO2 if known.
    EPA recognizes that at this time the source of CO2 
injected underground is predominantly CO2 produced from 
natural CO2 domes. It is possible that GS using naturally 
sourced CO2 may not qualify as a GHG mitigation action 
because the purpose of GS is to isolate CO2 that would 
otherwise have been emitted to the atmosphere. Under this proposed 
rule, however, GS facilities must report annual CO2 
sequestered regardless of the source.
    EPA seeks comment on whether the three reporting requirements 
described above are sufficient or if there are additional reporting 
requirements that should apply to all CO2 injection 
facilities. EPA is proposing that the best available monitoring methods 
(BAMM) provision outlined in Sec.  98.3(d) of the MRR would apply in 
2011 to injection facilities for the first tier of reporting 
requirements. EPA seeks comment on this proposal.
    For this proposed rule, EPA also considered, but is not proposing, 
that a CO2 injection facility be required to report only the 
CO2 injection data it collects under its current UIC permit 
(under any class) or relevant permit in the case of a facility that is 
outside SDWA jurisdiction. Although this would impose the lowest burden 
on the reporter since no new data would need to be collected, EPA would 
not receive complete data on the mass of CO2 injected. While 
collection of injection volume is a minimum monitoring requirement for 
all UIC well classes, CO2 concentration data are not. 
Furthermore, facilities are not required to report CO2 
transferred onsite from offsite sources or the source of CO2 
under any UIC permit class.
    EPA is proposing that GS facilities would be required to report a 
second tier of data in subpart RR. These reporting requirements include 
the amount of leakage of CO2 to the surface (if any), the 
amount of CO2 in produced oil or gas (for GS facilities 
conducting active ER operations), the amount of fugitive and vented 
CO2 emissions from surface equipment, and the total annual 
amount of CO2 sequestered using a mass balance equation. In 
this equation, the sum of the CO2 emissions listed above 
would be subtracted from the amount of CO2 injected to equal 
the amount of CO2 sequestered. These four reporting 
requirements are described in more detail below.
    GS facilities must report CO2 leakage, if any occurs 
from the subsurface geologic formation to the surface. EPA is not 
proposing specific procedures or methodologies for detecting or 
quantifying CO2 leakage. However, each GS facility would be 
required to develop and implement a site-specific approach to 
monitoring, detecting, and quantifying CO2 leakage based on 
five requirements that are described in Section II.D of this preamble.
    Second, EPA is proposing that GS facilities that are actively 
producing oil or gas would be required to report the quantity of 
CO2 produced out of the subsurface with produced oil or 
natural gas. This would be done by measuring at each separator the 
volumetric flow or mass flow and the concentration of a CO2 
stream. These GS facilities would also report CO2 that 
remains in the oil or gas after separation.
    Third, unless already reported in the petroleum and natural gas 
system subpart, subpart W, EPA is proposing that all GS facilities 
would be required to report fugitive and vented CO2 
emissions from surface components located within the facility for which 
procedures and methodologies are provided in subpart W. This could 
include pump blow-downs and fugitive emissions from valves, flanges, 
and compressors. EPA seeks these data to better understand the volume 
of fugitive and vented GHG emissions at GS facilities as compared to 
the volume of CO2 sequestered. This information is an 
important indicator of the effectiveness of GS as a GHG mitigation 
technology. In addition, fugitive and vented CO2 emissions 
will need to be included in the mass balance calculation of GS if they 
occur downstream of the CO2 injection flow meter or (if 
applicable for ER projects) upstream of the production flow meter. This 
is further discussed in Section II.D.3 of this preamble. This proposed 
rule does not impose a general requirement for all CO2 
injection facilities to report fugitive and vented CO2 
emissions from surface components since facilities that are not 
sequestering CO2 would not report GS. EPA seeks comment on 
this approach.
    Lastly, EPA is proposing that GS facilities use a mass balance 
equation to calculate and report CO2 sequestered in the 
subsurface geologic formation in the reporting year. This reported data 
point would be valuable for EPA as the Agency tracks CO2 
across a CCS system and will provide EPA with information on the 
performance of GS projects over time. EPA seeks comment on this 
approach.
    Alternatively, EPA could approximate CO2 sequestered in 
the subsurface without proposing additional reporting requirements for 
GS facilities, by using data already reported on CO2 
transferred from offsite and CO2 injected. EPA considered 
but did not propose this approach because it does not account for 
potential leakage from the subsurface and does not properly account for 
CO2 fugitive or vented emissions from surface equipment 
during post-production, processing, transport, or compression. Given 
the importance of GS as a GHG mitigation technology, EPA seeks to 
achieve an accurate reporting of GS. EPA seeks comment on the proposed 
requirements for GS facilities.
    EPA recommends that CO2 injection and GS facilities 
review subparts C and PP and proposed subpart W. Subpart C provides GHG 
calculation procedures and reporting requirements for stationary fuel 
combustion devices that combust solid, liquid, or gaseous fuel. 
CO2 injection and GS facilities should pay close attention 
to compressors and pumps located within the facility boundary. Subpart 
PP provides procedures for calculating and reporting quantities of 
CO2 supplied to the economy. The subpart W proposal covers 
petroleum and natural gas systems by defining eight types of facilities 
and providing calculation procedures and reporting requirements for the 
GHG emissions of specific

[[Page 18587]]

equipment that may be located in those facilities. CO2 
injection and GS facilities should review in particular the definitions 
of onshore and offshore petroleum and natural gas production 
facilities.
    EPA is proposing that if an injection facility is not conducting 
GS, it would determine applicability to other subparts of the rule 
separately from applicability to subpart RR (see Table 4 of this 
preamble). This is similar to the approach taken by reporters of 
upstream petroleum products supply, natural gas supply, natural gas 
liquids supply, and carbon dioxide supply (reporters in subparts MM, 
NN, and PP). For example, an injection facility not characterized as a 
GS facility would not automatically trigger reporting under subpart C 
by this proposal, but would make a separate applicability determination 
under subpart C. A GS facility would automatically trigger 
applicability under other subparts of the rule. This is similar to the 
approach taken by reporters of downstream emissions in the rest of the 
MRR. For example, the GS facility would report under subpart C the 
emissions from combustion sources located within the facility boundary, 
such as compressors.

    Table 4--Reporting Requirements in MRR for CO2 Injection and GS Facilities (in Subpart RR, Subpart C, and
                                               Proposed Subpart W)
----------------------------------------------------------------------------------------------------------------
                                    Injection facilities (no GS)                     GS facilities
        Data to report         ---------------------------------------------------------------------------------
                                        ER               Other             With ER                Other
----------------------------------------------------------------------------------------------------------------
Quantity of CO2 transferred     subpart RR.......  subpart RR.......  subpart RR.......  subpart RR.
 onsite.
Source of CO2 if known........  subpart RR.......  subpart RR.......  subpart RR.......  subpart RR.
Quantity of CO2 injected......  subpart RR.......  subpart RR.......  subpart RR.......  subpart RR.
Fugitive and vented CO2         subpart W........  Not Applicable...  subpart W or       subpart RR.
 emissions from surface                                                subpart RR \1\.
 equipment.
Emissions from combustion       Separate           Separate           subpart C \2\....  subpart C \2\.
 sources.                        applicability      applicability
                                 determination.     determination.
Quantity of CO2 produced with   Not Required.....  Not Required.....  subpart RR.......  subpart RR.
 oil or natural gas.
Percent of CO2 estimated to     Not required.....  Not required.....  subpart RR.......  Not applicable.
 remain with the oil and gas.
Quantity of CO2 emitted from    Not Required.....  Not Required.....  subpart RR.......  subpart RR.
 the subsurface.
Quantity of CO2 sequestered...  Not Applicable...  Not Applicable...  subpart RR.......  subpart RR.
----------------------------------------------------------------------------------------------------------------
\1\ Subpart W if the facility meets the subpart W threshold; if not then report in subpart RR.
\2\ All GS facilities will be required to report combustion emissions according to subpart C.

    In selecting data to be reported under today's proposal, EPA 
compared reporting requirements under today's subpart RR proposal with 
reporting under the UIC Class VI proposal (see Table 5 of this 
preamble). EPA found two data elements with potential overlap. The 
first area of potential overlap is the reporting of the amount (flow 
rate) of injected CO2. The UIC Class VI and subpart RR 
proposals differ in the measurement unit and collection/reporting 
frequency. EPA determined that reporting of the amount (flow rate) of 
injected CO2 was necessary in order to harmonize the data 
with other subparts of the MRR. To ensure that data needs are 
harmonized between the MRR and the UIC program requirements and to 
reduce burden, and because this data under a State-issued UIC permit is 
currently submitted to States while, under today's subpart RR proposal, 
reporters will be submitting data directly to EPA. EPA will look for 
ways to integrate data management between the UIC and MRR programs and 
the Agency is seeking comment on reporting the amount (flow rate) of 
CO2 injected for purposes of this proposal.

               Table 5--Data Elements Reported Under UIC Class VI Proposal and Subpart RR Proposal
----------------------------------------------------------------------------------------------------------------
                                                                               Subpart RR proposal
                                                               -------------------------------------------------
             Data element               UIC class VI proposal        CO2 injection
                                                                   facilities (no GS)         GS facilities
----------------------------------------------------------------------------------------------------------------
Quantity of CO2 transferred onsite...  No.....................  Yes....................  Yes.
Quantity (flow rate) of CO2 injected.  Yes....................  Yes....................  Yes.
Fugitive and vented emissions from     No.....................  No.....................  Yes.
 surface equipment.
Quantity of CO2 produced with oil or   No.....................  No.....................  Yes.
 natural gas (ER).
Percent of CO2 estimated to remain     No.....................  No.....................  Yes.
 with the oil and gas (ER).
Quantity of CO2 emitted from the       No.....................  No.....................  Yes.
 subsurface.
Quantity of CO2 sequestered in the     No.....................  No.....................  Yes.
 subsurface.
Cumulative mass of CO2 sequestered in  No.....................  No.....................  Yes.
 the subsurface.
Monitoring plan......................  Yes....................  No.....................  Yes.
----------------------------------------------------------------------------------------------------------------

    The second area of potential overlap relates to monitoring plans. 
Although both the UIC Class VI proposal and today's subpart RR proposal 
have monitoring plan requirements, the UIC Class VI proposal is focused 
on protection of USDWs, while today's subpart RR proposal is focused on 
air emissions. Potential differences include

[[Page 18588]]

baseline data and detection and measurement of CO2 leakage 
to the surface. Recognizing that air monitoring under the UIC Class VI 
proposal is at the discretion of the UIC director, EPA notes that a UIC 
Class VI permit may fulfill requirements under today's proposal.
    EPA considered whether a GS facility should also report methane 
(CH4) leakage emissions from the subsurface. CH4 
emissions from the subsurface may occur at oil and natural gas 
reservoirs or ECBM sites. The cases in which leakage of CH4 
could occur at these sites may be similar to the potential for 
CO2 leakage. CH4 leakage could potentially occur 
through improperly sealed wells, open faults, and other pathways that 
have also been identified as potential CO2 leakage pathways. 
However, CH4 is present as a gas, and thus may be more 
upwardly mobile than CO2 which is injected as a 
supercritical fluid. Therefore, the potential for leakage of methane at 
depleted oil and gas or ECBM sites may be greater than for 
CO2.
    EPA is proposing to focus on CO2 emissions. EPA 
recognizes the potential for CH4 leakage from the subsurface 
at facilities conducting GS in oil and gas reservoirs or coal seams and 
therefore seeks comment on whether to require reporting on 
CH4 leakage. If the potential for CH4 leakage 
exists, the GS reporter could include in the MRV plan a monitoring 
strategy to detect and quantify potential CH4 leakage. 
CH4 fugitive and vented emissions from surface equipment are 
covered under the proposed oil and gas subpart, subpart W.
    Under subparts C through QQ of the MRR, adjacent or contiguous 
equipment in actual physical contact under common ownership or common 
control constitute a facility (see Section 98.6 of the MRR). In the 
case of petroleum and natural gas systems and GS, equipment are not 
necessarily in physical contact with one another in the conventional 
sense of the term. Subparts W and RR are each proposing interpretations 
of what would constitute a facility. As a result, a GS facility 
conducting ER may apply one facility boundary for reporting under 
subpart W and a different facility boundary for reporting under subpart 
RR. EPA acknowledges that this may present a challenge for submitting 
annual reports, depending on how the data system is designed. A 
CO2 injection or GS operation would submit an annual report 
to EPA according to the proposed definition of facility discussed in 
Section II.A of this preamble. EPA seeks comment on a resolution that 
would reduce reporting burden while still meeting the data needs of 
both proposed subparts W and RR.
    EPA also recognizes that, in the case of an ER operation conducting 
GS, the combustion emissions from equipment within the GS facility 
would be included in both annual reports. Though this approach results 
in duplicative reporting, EPA has concluded that to analyze the 
efficacy of GS as a GHG mitigation tool, EPA needs to collect 
information on combustion emissions from GS facility equipment at only 
the GS facility level rather than aggregated with emissions from 
additional equipment. EPA seeks comment on this approach for reporting 
combustion emissions from GS facilities.

D. Selection of Monitoring, Reporting, and Verification (MRV) Plan 
Requirements and Approval Process

1. Selection of MRV Plan Option
    EPA considered three alternatives for monitoring, reporting and 
verification of potential CO2 leakage at GS sites: do not 
require an MRV plan, require a universal MRV plan that applies to all 
GS sites, or require a site-specific MRV plan. The three alternatives 
vary in stringency and specificity as described below. EPA outlines the 
advantages and disadvantages of each alternative and seeks comment on 
each alternative, as well as any alternatives not discussed.
    Under the first alternative, EPA would allow GS facilities to 
report the amount of CO2 sequestered without requiring an 
MRV plan. Under this alternative, the Agency would rely on published 
information and existing studies to assume that injected CO2 
remains sequestered and would assume these results can be generalized 
to all GS projects. This alternative would impose the least burden on 
reporters. EPA notes that international guidelines on information 
collection and reporting efforts outlined in Section I.E of this 
preamble do not support this approach. Furthermore, EPA did not propose 
this approach because of the limited empirical data and the variability 
in geology and other conditions among GS facilities.
    The second alternative that EPA considered was a one-size-fits-all 
MRV plan approach under which the Agency would prescribe specific 
monitoring technologies and quantification methods for GS facilities. 
The advantage of this approach is that all GS facilities would use the 
same monitoring technologies and methods. The disadvantage of this 
approach is that the geology and other conditions at potential GS 
facilities will vary from site to site and a one-size-fits all approach 
may not provide the most effective monitoring strategy for all 
facilities. EPA notes that international guidelines on information 
collection and reporting efforts outlined in Section I.E of this 
preamble do not support this approach. In addition, since the 
monitoring and testing plans implemented under the UIC program are 
necessarily site-specific in nature, it would be difficult to prescribe 
a one-size-fits-all MRV plan that would complement and build upon the 
UIC program. This alternative would likely be the least cost effective 
and most burdensome approach for reporters.
    The third alternative, and the alternative that EPA is proposing, 
is that GS facilities be required to develop a site-specific MRV plan 
and submit it to EPA for approval. Facilities would report 
CO2 injection until the final MRV plan has been approved. 
Once a final MRV plan has been approved by EPA, GS facilities would 
implement the plan, including the reporting of the amount of 
CO2 that has been sequestered. The advantage of this 
approach is that it provides a flexible and cost-effective option for 
reporters and complements monitoring requirements under the proposed 
UIC Class VI rule. EPA recognizes that the rigorous proposed UIC Class 
VI requirements will provide the foundation for the safe sequestration 
of CO2 and should serve to reduce the risk of CO2 
leakage to the atmosphere when finalized. An adequate MRV plan would be 
tailored to site-specific conditions and be designed for each stage of 
the GS project. In addition, the MRV plan would allow for modification 
or adaptation of the plan based on monitoring results. Although the 
risk of leakage at an appropriately selected and managed GS facility 
may be low, the MRV plan would ensure that if leakage occurs, the GS 
reporter would have an approved methodology for measuring the emitted 
CO2. If leakage occurs, the MRV plan would also provide a 
process for revising the MRV plan, if necessary, as described in 
section II.E of this preamble.
    It is important to recognize that this proposed rule is a data 
collection and monitoring proposal which does not directly address the 
potential human health and welfare, ground or surface water, ecosystem 
or geosphere impacts of GS. Therefore, the proposed rule does not 
address these potential impacts from CO2 leakage (e.g., 
requiring remediation or mitigation) as this is outside the scope of 
this proposal.

[[Page 18589]]

2. Background on MRV Approaches
    EPA has identified published studies and/or guidelines on 
monitoring programs that identify and quantify CO2 leakage 
from GS facilities.\23\ While the science of quantifying CO2 
leakage from GS facilities is evolving, it is generally recognized 
that, when properly planned and implemented, monitoring methods will be 
effective at detecting leakages.\24, 25\
---------------------------------------------------------------------------

    \23\ Arts, R, O Eiken, A Chadwick, P Zweigel, L van der Meer, B 
Zinszner. 2004. ``Monitoring of CO2 injected at Sleipner 
using time-lapse seismic data.'' Energy 29: 1383-1392; Wilson, M. 
and M. Monea (Eds.). 2004. ``IEA GHG Weyburn CO2 
Monitoring and Storage Project,'' Seventh International Conference 
on Greenhouse Gas Control Technologies, Vol. 3; Klusman, RW. 2003. 
``Rate Measurements and Detection of Gas Microseepage to the 
Atmosphere from an Enhanced Recovery Sequestration Project, Rangely, 
Colorado, USA,'' Applied Geochemistry, 18, 1825-1838; 2006 IPCC 
Guidelines for National Greenhouse Gas Inventories: Volume 2--
Energy. Chapter 5 Carbon Dioxide Transport, Injection, and 
Geological Storage. Available at: http://www.ipcc-nggip.iges.or.jp/public/2006gl/index.htm.; DOE/NETL. 2009. ``Best Practices for 
Monitoring, Verification, and Accounting for CO2 Stored 
in Deep Geologic Formations.'' U.S. Department of Energy, National 
Energy Technology Laboratory.
    \24\ Benson, SM. 2006. ``Monitoring Carbon Dioxide Sequestration 
in Deep Geological Formations for Inventory Verification and Carbon 
Credits.'' Society of Petroleum Engineers Paper 102833.
    \25\ FutureGen Alliance. 2006. ``Mattoon Site Environmental 
Information Volume.'' December 2006.
---------------------------------------------------------------------------

    Though the methodologies for detecting and quantifying leakage of 
CO2 from GS facilities have not been standardized, EPA has 
concluded that a GS facility would be able to propose a site-specific 
plan for leak detection and quantification under this rule based on the 
current availability of monitoring technologies. A wide range of 
techniques for monitoring sequestration of CO2 have been 
used for a number of years in other applications, including oil and 
natural gas production, natural gas storage, disposal of liquid and 
hazardous waste in deep geologic formations, groundwater monitoring, 
and ecosystem research.\26\ Some monitoring techniques such as seismic 
monitoring can detect the presence and location of CO2 in 
the subsurface, including both vertical and lateral spread, although 
the accuracy of seismic monitoring for quantifying the amount of 
CO2 may be more limited than other approaches. Other 
techniques, such as soil gas monitors or eddy covariance techniques, 
can detect, within a certain limit, leakage of CO2 from the 
confining system. Many of these technologies have excellent 
sensitivity, and have been shown to be able to detect relatively low 
concentrations of CO2 above background levels. The minimum 
leakage rate detectable is a function of parameters such as the volume 
of CO2 making its way to the surface, the size of the leak 
area, and the sensitivity of the monitoring device.
---------------------------------------------------------------------------

    \26\ Benson, S and L Myer. 2002. ``Monitoring to Ensure Safe and 
Effective Geological Sequestration of Carbon Dioxide.'' Lawrence 
Berkeley Laboratory, Berkeley, California; Benson, SM. 2002. 
``Geologic Sequestration of Carbon Dioxide.'' The Carbon Dioxide 
Dilemma, Promising Technologies and Policies, Proceedings of a 
Symposium, National Academy of Engineering, April 23-24, 2002, 
Washington, DC, pp. 29-39.
---------------------------------------------------------------------------

    Descriptions of the various monitoring technologies that could be 
deployed at a GS facility can be found in the general TSD to this 
proposal.\27\ EPA seeks comment on the general TSD and seeks additional 
data and information on monitoring technologies for leak detection and 
quantification. Additional information on GS monitoring technologies 
can also be found in the IPCC Guidelines for National Greenhouse Gas 
Inventories (2006), the API/IPECA Inventory Guidelines for CCS (2007), 
Department of Energy MVA Best Practices Manual (2009), and the 
International Energy Agency GHG R&D Programme monitoring tool Web site 
(www.co2captureandstorage.info/co2monitoringtool).
---------------------------------------------------------------------------

    \27\ Subpart RR General TSD (see docket ID No. EPA-HQ-OAR-2009-
0926).
---------------------------------------------------------------------------

3. MRV Plan Requirements
    EPA is proposing that each submitted MRV plan must include at a 
minimum the four requirements described below:
     Step 1--Assessment of Risk of Leakage: All potential 
pathways that may result in CO2 leakage have been identified 
and characterized and the risk of CO2 leakage at each 
pathway has been evaluated;
     Step 2--Strategy for Detecting and Quantifying 
CO2 Leakage to Surface: Potential pathways will be monitored 
according to the risk of CO2 leakage to ensure that any 
leakage to the surface will be detected and that leakage to the 
surface, should it occur, will be quantified according to a specified 
methodology;
     Step 3--Strategy for Establishing Pre-Injection 
Environmental Baselines: Environmental baselines against which the 
monitoring results will be evaluated have been established at potential 
leakage pathways; and
     Step 4--Tailor Mass Balance Equation: Site-specific 
variables have been considered and developed for the mass balance 
equation provided in the regulatory text to calculate the amount of 
CO2 sequestered.
    These requirements are consistent with the IPCC Guidelines for 
National Greenhouse Gas Inventories (2006), as well as the other 
information collection and reporting efforts outlined in Section I.F of 
this preamble.
    EPA developed a monitoring plan TSD that describes characteristics 
of a robust monitoring plan, and provides descriptions of potential GS 
geologic settings, potential leakage pathways, and the goals of 
monitoring.\28\ The monitoring plan TSD uses EPA's Vulnerability 
Evaluation Framework (VEF) to describe potential vulnerabilities that 
may influence the risk for CO2 leakage from a GS project and 
is not intended to be used as a step by step guide to develop an MRV 
plan. The VEF includes a holistic discussion of the potential impacts 
of GS. The VEF is also provided in the docket.\29\ EPA seeks comment on 
the monitoring plan TSD.
---------------------------------------------------------------------------

    \28\ Monitoring Plans for Geologic Sequestration TSD (see docket 
ID No. EPA-HQ-OAR-2009-0926).
    \29\ Vulnerability Evaluation Framework for Geologic 
Sequestration of Carbon Dioxide (see docket ID No. EPA-HQ-OAR-2009-
0926).
---------------------------------------------------------------------------

    In developing the proposed MRV plan requirements, EPA compared 
monitoring requirements under the UIC Class VI proposal with those 
under today's MRR proposal, as shown in Table 6 of this preamble. 
Monitoring requirements under the UIC Class VI proposal are focused on 
demonstrating that USDWs are not endangered as a result of 
CO2 injection into the subsurface. As proposed, a UIC Class 
VI permit would require a site characterization and assessment of 
leakage pathways for the purpose of protection of USDWs. Therefore, EPA 
is proposing that a UIC Class VI permit may be used to demonstrate to 
EPA that the assessment of risk of leakage step of the MRV plan has 
been satisfied. The UIC Class VI proposal indicates that UIC Class VI 
permits may include surface monitoring at the UIC Director's 
discretion. To the extent that the UIC Class VI permit includes these 
surface monitoring and related environmental baseline components, it 
may be used to demonstrate to EPA that the strategy for detection and 
measurement of leakage to the surface and the strategy for establishing 
pre-injection environmental baselines have been satisfied. EPA seeks 
comment on allowing the use of a UIC Class VI permit to fulfill certain 
MRV plan requirements, whether there are situations where EPA's 
proposal to rely on a UIC Class VI permit would not be sufficient.

[[Page 18590]]



   Table 6--Proposed MRV Plan Elements Under UIC Class VI Proposal and
                           Subpart RR Proposal
------------------------------------------------------------------------
                                                        Required under
    Proposed MRV plan element     Required under UIC      subpart RR
                                  Class VI  proposal       proposal
------------------------------------------------------------------------
Assessment of Risk of Leakage...  to USDWs..........  to surface.
Strategy for Detecting and        No................  Yes.
 Quantifying CO2 Leakage to
 Surface.
Strategy for Establishing Pre-    No................  Yes.
 Injection Environmental
 Baselines at Surface.
Tailor Mass Balance Equation....  No................  Yes.
------------------------------------------------------------------------

    Reporters that do not hold UIC Class VI permits would be required 
to provide the MRV plan element information outlined in this section.
    Assessment of Risk of Leakage to the Surface. EPA is proposing that 
the GS facility reporter must provide sufficient information in the MRV 
plan to demonstrate to EPA that the potential risk for CO2 
leakage to the surface has been evaluated. This evidence must be ``a 
combination of site characterization and realistic models that predict 
the movement of CO2 over time and locations where emissions 
might occur''.\30\ EPA seeks this information to evaluate the leak 
detection strategy put forth by the reporter in the MRV plan. EPA 
believes this information is reasonable to request because it 
determines the boundaries of the area which will be monitored for 
potential CO2 leakage. The risk assessment for 
CO2 leakage allows the reporter to target monitoring in 
specific areas within these boundaries.
---------------------------------------------------------------------------

    \30\ 2006 IPCC Guidelines for National Greenhouse Gas 
Inventories: Volume 2--Energy. Chapter 5 Carbon Dioxide Transport, 
Injection, and Geological Storage. Available at: http://www.ipcc-nggip.iges.or.jp/public/2006gl/index.htm; see also UIC Class VI 
proposal, 73 FR 43492 (July 25, 2008).
---------------------------------------------------------------------------

    EPA is proposing that to demonstrate to the Agency that the risk of 
leakage to the surface has been evaluated over the appropriate spatial 
area,\31\ the GS facility must determine through site characterization 
and computational modeling the spatial area that may be impacted by the 
CO2 injection activity over the lifetime of the project, 
accounting for the physical and chemical properties of all phases of 
the injected CO2 stream. This spatial area must be 
determined to account for all potential leakage pathways, including 
wells. If the GS facility is producing oil or gas, the spatial area 
would also need to contain the production wells associated with 
CO2 injection.
---------------------------------------------------------------------------

    \31\ EPA recognizes that surface rights access to the entire 
spatial area required for site characterization and monitoring may 
not conveniently rest with the owner or operator of the 
CO2 injection wells (i.e., the GS facility reporter in 
subpart RR). Issues associated with surface and pore space ownership 
are outside the scope of this proposed rule. However, the Agency 
recognizes that the MRV plan will need to take into account the 
relevant ownership rights and property access.
---------------------------------------------------------------------------

    EPA is proposing that the GS facility would be required to re-
evaluate and re-model the spatial area of evaluation at least every ten 
years or to describe the rationale for a different frequency in its MRV 
plan and, once approved, apply that frequency. Requiring re-evaluation 
of the spatial area of monitoring through updating simulation models 
with new monitoring data will provide the most accurate representation 
of subsurface CO2 movement.
    EPA seeks comment on the proposed re-evaluation frequency and 
whether the spatial area required for site characterization is adequate 
to detect and quantify potential leakage to the surface. Specifically, 
EPA seeks comment on whether there will be cases in which the spatial 
area should be larger to detect unexpected leakage to the surface 
beyond the pressure front boundary. Alternatively, EPA seeks comment on 
whether the spatial area should be larger than the lateral extent of 
the CO2 plume, but smaller than the area defined by the 
pressure front. EPA also seeks comment on whether the spatial area 
should be defined by the lateral extent of the CO2 plume.
    The MRV plan should include a description of the site 
characterization that confirms that the geology and the local and 
regional hydrogeology of the GS facility have been evaluated and that 
explains how the spatial area was established. This should include a 
narrative description of the geologic formation(s) along with simple 
stratigraphic depictions showing formation depths and locations, 
information on the presence of an effective confining system \32\ 
overlying the injection zone,\33\ and a map showing the modeled spatial 
area of evaluation over the lifetime of the project.
---------------------------------------------------------------------------

    \32\ A confining system is a geological formation, group of 
formations, or part of a formation that is comprised of impermeable 
or distinctly less permeable material stratigraphically overlying 
the injection zone that acts as a barrier to CO2 
movement. (73 FR 43492).
    \33\ The injection zone is a geologic formation, group of 
formations, or part of a formation that is of sufficient areal 
extent, thickness, porosity, and permeability to receive carbon 
dioxide through a well or wells associated with a GS project. (73 FR 
43492).
---------------------------------------------------------------------------

    The MRV plan should also demonstrate to EPA that all potential 
leakage pathways for CO2 escape to the surface from the 
injection zone in the spatial area have been identified and 
characterized. Wells (and other artificial penetrations such as 
boreholes) are one of the most probable conduits for the escape of 
CO2 from the injection zone.\34\ If a well penetrates the 
confining system, the site characterization should include an 
assessment of supporting documentation such as well construction and 
plugging. Faults and fractures that are natural or that may be induced 
by pressure changes may also serve as pathways for CO2 
leakage out of the confining zone and to the surface. Additionally, 
geologic heterogeneities, such as high permeability zones in the 
confining system or an insufficient lateral extent of the confining 
system, may be potential leakage pathways for CO2. The MRV 
plan should include the location and depth of all potential leakage 
pathways along with a qualitative description of their condition. For 
more information on leakage pathways, see the monitoring plan TSD.\35\ 
The MRV plan should include an overview of the methods used to 
characterize the site; actual data can but does not need to be 
initially submitted.
---------------------------------------------------------------------------

    \34\ Gasda, SE, S Bachu and MA Celia. 2004. ``The potential for 
CO2 leakage from storage sites in geological media: 
Analysis of well distribution in mature sedimentary basins,'' 
Environmental Geology 46 (6-7), pp. 707-720; Benson, SM. 2005. 
``Monitoring to Ensure Safe and Effective Geologic Sequestration of 
Carbon Dioxide,'' IPCC Workshop on Carbon Dioxide Capture and 
Storage; IPCC. 2005. ``IPCC Special Report on Carbon Dioxide Capture 
and Storage,'' by Working Group III of the Intergovernmental Panel 
on Climate Change. Available at: http://www1.ipcc.ch/ipccreports/srccs.htm; Carey, J, M Wigand, SJ Chipera, G WoldeGabriel, R Pawar, 
PC Lichtner, SC Wehner, MA Raines, GD Guthrie, Jr. 2007. ``Analysis 
and performance of oil well cement with 30 years of CO2 
exposure from the SACROC Unit, West Texas, USA.'' 8th International 
Conference on Greenhouse Gas Control Technologies, International 
Journal of Greenhouse Gas Control Volume 1, Issue 1, April 2007, 
Pages 75-85.
    \35\ Monitoring Plans for Geologic Sequestration TSD (see docket 
ID No. EPA-HQ-OAR-2009-0926).
---------------------------------------------------------------------------

    Finally, the risk assessment component of the MRV plan should

[[Page 18591]]

include an overview of the methods used to model the subsurface 
behavior of CO2 and the modeling results that estimate the 
timing, location, route and flux of potential leakage to the surface. 
It should include a brief overview of the input data quantity and the 
level of uncertainty associated with the models, as well as sensitivity 
analysis to assess the range of potential CO2 leakage 
emissions.
    Strategy for Detecting and Quantifying CO2 Leakage to 
the Surface. EPA is proposing that the MRV plan must provide a strategy 
for leak detection. The MRV plan would include the methodology for, 
rationale for, and frequency of monitoring that will be conducted to 
detect potential leakage of CO2 to the surface. The strategy 
for leak detection should be based on the risk assessment required in 
this Section II.D.3 of this preamble and be targeted to where and when 
leakage to the surface is most likely to occur. Therefore, the MRV plan 
should also describe the methodology for, rationale for, and frequency 
of evaluation of the entire spatial area of the GS facility to detect 
any CO2 emissions from unexpected leakage pathways. The MRV 
plan should describe the monitoring technologies that will be employed 
at the facility, the assumed detection limits of the technologies, the 
monitoring locations, spatial array, and frequency of sampling. The MRV 
plan should provide the rationale and justification for each of these 
choices. A leak detection strategy that adequately meets this proposed 
rule's requirements may include a combination of subsurface, vadose 
zone, soil zone, ocean, surface water, and/or atmospheric monitoring 
and modeling. For the purposes of this proposed rule, CO2 
leakage to the surface includes CO2 emitted to the 
atmosphere, CO2 emitted to the ocean from the sub-seabed, 
CO2 emitted to surface water, and CO2 emitted to 
indoor air environments. The Agency notes that continuous air 
monitoring or mitigation is not required by this proposal.
    Even though only the CO2 that leaks to the surface must 
be quantified for this proposed rule, information about the movement of 
CO2 in the subsurface and near-surface can serve as an early 
warning of a potential leak at the surface. This information will lead 
to a better understanding of the GS facility and the anticipated 
movement of the CO2 plume, and it will help to pinpoint the 
area and the timing in which a potential leak to the surface may occur. 
This in turn will inform where monitoring for leak detection at the 
surface must be deployed.
    For example, sampling at a deep monitoring well may indicate 
migration of the CO2 out of the confining system. Though 
this monitoring result does not necessarily mean that CO2 
will eventually leak to the surface, the GS reporter would use this 
information on the sub-surface movement of CO2 to deploy 
monitoring equipment according to the strategy outlined in the MRV plan 
in case detection and quantification of CO2 leakage to the 
surface is necessary.
    Generally, an iterative process should be in place to update the 
predictive models by applying results of ongoing monitoring. The GS 
reporter needs to consider how the monitoring results will change the 
leak detection and quantification strategies in the MRV plan approved 
by EPA. Adjustments to the MRV plan may result from updates to the 
models that were used to identify the leakage pathways, assess the risk 
of leakage, and predict the scope of potential leakage scenarios. If 
the MRV plan is adjusted in these circumstances, the reporter must 
submit an addendum to EPA that describes how the leak detection and 
quantification strategy was adjusted (see Section II.E of this preamble 
for more detail).
    EPA is proposing that the MRV plan would not need to include 
methods for monitoring fugitive and vented CO2 emissions 
from surface equipment (e.g., CO2 compression systems) at GS 
facilities because, in EPA's view, those methods need not vary from 
site to site in order to estimate emissions effectively. Universal 
methods are proposed in subpart W, and those methods would be used to 
quantify fugitive and vented CO2 emissions from surface 
equipment and to report those emissions under subpart W or subpart RR 
as appropriate (see Section II.C of this preamble).
    If a CO2 leak is detected at the surface, the GS 
reporter must quantify the amount of CO2 leaked. EPA 
considered three alternatives for reporting CO2 leakage: 
assuming that all injected CO2 remains sequestered, assuming 
that a proportion of injected CO2 remains sequestered, and 
reporting of CO2 leakage based on site-specific monitoring. 
EPA outlines the advantages and disadvantages of each alternative and 
seeks comment and data on each alternative, as well as any alternatives 
not discussed.
    Under the first alternative, EPA would rely on published 
information and existing studies to assume that all injected 
CO2 remains sequestered. EPA would assume these results can 
be generalized to all GS projects. EPA notes that international 
guidelines on information collection and reporting efforts outlined in 
Section I.E of this preamble do not support this approach. Furthermore, 
EPA did not propose this approach because of the limited empirical data 
and the variability in geology, site management and/or business 
practices, and other conditions among GS facilities. In addition, 
assuming that all injected CO2 remains sequestered would not 
take into account potential fugitive or vented emissions from surface 
equipment or CO2 produced from oil or gas production wells, 
during or after operations.
    Under the second alternative, EPA would assume that a proportion of 
injected CO2 remains sequestered. EPA would assume that this 
proportion can be generalized to all GS projects. International 
guidelines on information collection and reporting efforts outlined in 
Section I.E of this preamble do not support this approach. Furthermore, 
EPA did not propose this approach because of the limited empirical data 
and the variability in geology, site management and/or business 
practices, and other conditions among GS facilities. EPA also seeks 
comment and data on whether a sequestration factor could be applied to 
ER operations in cases where CO2 injection and site 
operations are not specifically designed with GS in mind.
    The third approach, and the approach EPA is proposing today, is 
that the MRV plan describe the approaches that the GS reporter will 
take to quantify CO2 emissions if leakage is detected. The 
approach should be specific to the type of potential leak. For example, 
for point sources of CO2 (e.g., leakage from wells), bagging 
or tenting methods could be used. EPA recognizes that quantifying 
CO2 emissions and distinguishing CO2 leakage from 
background emissions is challenging, but necessary for the purposes of 
determining the total amount of CO2 that is sequestered at a 
GS facility. EPA is proposing that a leak could be quantified through 
estimation or by direct measurement and seeks comment on allowing 
either estimation or direct measurement for quantifying a leak.
    In cases where a leak is not quantified by estimation, EPA is 
proposing that if a leak is detected, the reporter must assume that the 
duration of the leak is equal to the duration between demonstrated null 
monitoring results unless subsurface monitoring can be used to provide 
a better indication on the timing of the leak. EPA finds this 
conservative approach reasonable because the estimate of the duration 
of the leak directly influences the estimate of the amount of 
CO2 emitted to the surface. The Agency recognizes that this

[[Page 18592]]

approach could overestimate emissions of CO2. EPA considered 
requiring that the MRV plan include a site-specific strategy for 
determining duration of any leakage detected in cases where a leak is 
not determined by estimation, but EPA concluded that this approach 
would allow too much variation in reporting on CO2 leakage 
(if any occurs) and would make the quantities of CO2 
reported as sequestered less comparable. EPA seeks comment on the 
selected approach for determining the duration of the leak event and 
the alternatives. EPA is proposing that if multiple CO2 
leaks to the surface occur in a reporting year, the mass of each leak 
should be quantified and the totals then aggregated for reporting.
    An approach for an uncertainty assessment of the leakage estimates 
and measurements derived from the proposed modeling and monitoring at 
the GS facility should also be included in this component of the MRV 
plan.
    As further outlined in Section II.E of this preamble, EPA is 
proposing that if leakage is detected during a given reporting year, 
the GS reporter must submit an annual report addendum to coincide with 
submission of the next annual report (March 31 of a following year).
    Strategy for Establishing Pre-Injection Environmental Baselines. 
EPA is proposing that the MRV plan describe when and how pre-injection 
environmental baselines would be established based on the strategy for 
leak detection described in this section of the preamble. The GS 
reporter is required to establish baselines at potential leakage 
pathways (based on the risk of leakage from these pathways), and over 
the entire spatial area of evaluation for periodic evaluation of 
unidentified leakage pathways. Pre-injection baselines will be used to 
evaluate the performance of the site and are essential to detect 
CO2 leakage from the site.
    CO2 is ubiquitous in the environment and concentrations 
may vary over space and time (e.g., diurnally, seasonally, annually). 
Therefore, determining background levels of CO2 and 
understanding natural fluctuations is necessary to discern whether 
detected CO2 is attributable to leakage or to preexisting 
sources. It is also important to establish baselines before injection 
because many of the instruments used to monitor CO2 at the 
surface do not measure fluxes of CO2 directly; rather, the 
instruments are useful for tracking the injected CO2 because 
one can compare parameters before and after injection and over 
time.\36\ Environmental baselines at the facility before injection must 
reflect diurnal, seasonal, and annual changes in not only the levels of 
CO2 but also in other relevant surface and/or near-surface 
conditions (e.g., wind speed). Baseline monitoring could also include 
gas composition and isotopic analysis of any background fluxes of 
CO2, which may be useful for distinguishing between natural 
(biogenic or thermogenic) and anthropogenic CO2.\37\
---------------------------------------------------------------------------

    \36\ Benson, S, E Gasperikova, and M Hoversten. 2004. ``Overview 
of Monitoring Techniques and Protocols for Geologic Storage 
Projects.'' Prepared for the IEA GHG Programme. PH4-29; Johnson, J. 
2009. ``Integrated modeling, monitoring, and site characterization 
to assess the isolation performance of geologic CO2 
storage: Requirements, challenges, and methodology.'' Energy 
Procedia 1:1855-1861; Forbes, S, P Verma, T Curry, J Friedman, S 
Wade. 2008. ``Guidelines for carbon dioxide capture, transport, and 
storage.'' World Resources Institute. Available at: http://pdf.wri.org/ccs_guidelines.pdf.
    \37\ American Petroleum Institute and International Petroleum 
Industry Environmental Conservation Association. 2007. ``Oil and 
Natural Gas Industry Guidelines for Greenhouse Gas Reduction 
Projects Part II: Carbon Capture and Geological Storage Emission 
Reduction Family,'' June, 2007.
---------------------------------------------------------------------------

    There may be cases in which CO2 injection has taken 
place for some time (potentially years, as in the case of currently 
operating ER projects) and the baseline was not evaluated pre-
injection. EPA is proposing that a facility in this situation would 
outline in this component of the MRV plan alternatives to establishing 
pre-injection baselines. In such situations, alternatives to 
characterizing baseline conditions could include identification of 
proximal locations where diurnal, seasonal, and annual measurements 
that are assumed to be similar to pre-injection conditions at the site 
can be taken. This technique was used by a site that detected annual 
CO2 emissions of about 3,800 tonnes/year (0.01 percent of 
total injected CO2) from surface monitoring but could not 
compare the flux to a pre-injection baseline to determine what 
percentage was attributable to injected CO2.\38\ Other 
approaches could include permanent continuous monitor networks with 
upwind and downwind correlation or mobile monitoring capable of 
determining local ambient background levels. EPA recognizes the 
challenge in establishing a baseline in these cases and seeks comment 
on this proposed case-by-case approach and on whether real-time 
determination of environmental baseline upwind of potential leakage is 
preferred.
---------------------------------------------------------------------------

    \38\ Klusman, RW. 2003. ``Rate measurements and detection of gas 
microseepage to the atmosphere from an enhanced oil recovery/
sequestration project, Rangely, Colorado, USA.'' Applied 
Geochemistry, volume 18, issue 12.
---------------------------------------------------------------------------

    Tailor Mass Balance Equation for Sequestration. As explained in 
Section II.C of this preamble, a GS reporter would be required to 
report the annual amount of CO2 sequestered at a facility 
using a mass balance equation, in which the sum of CO2 
emissions would be subtracted from the amount of CO2 
injected to equal the amount of CO2 sequestered. A specific 
mass balance equation is provided in the regulatory text, to which the 
facility must apply site-specific variables based on operational 
conditions. Accordingly, EPA is proposing that a GS reporter must 
consider whether any fugitive or vented CO2 surface 
emissions were measured downstream of the injection flow meters (i.e., 
between the injection flow meter and the injection well). If so, these 
quantities should not be accounted as stored and should be subtracted 
from the mass balance equation as a variable. A GS facility with ER 
operations must additionally consider whether any fugitive or vented 
CO2 emissions were measured upstream of the production flow 
meters (i.e., between the production well and the separator) and how 
much produced CO2 is not successfully measured by the 
production flow meter because it remains dissolved in the produced oil 
or gas. For ER operations, these quantities should not be accounted as 
stored and should also be subtracted from the mass balance equation as 
variables.
    EPA is proposing that GS reporters be required to include a written 
summary of these considerations, including any assumptions made and 
methodologies used to calculate these site-specific variables over the 
reporting year.
4. MRV Plan Approval Process
    EPA is proposing to evaluate each MRV plan to ensure that the GS 
facility has an appropriate strategy in place to effectively quantify 
geologically sequestered CO2. EPA will evaluate the adequacy 
of the methodologies proposed to detect and quantify leakage, including 
whether the chosen monitoring technologies are suitable for the type of 
leakage pathway and for the type of risk evaluated at that pathway.
    This proposal is being conducted under CAA section 114. As such, it 
does not require control measures, remediation, or any other actions 
that would alter operations at a facility. In order to develop, gain 
approval of, and implement its MRV plan, a GS facility would not be 
expected to shut down or delay its operations. EPA developed the 
proposed reporting requirements with

[[Page 18593]]

consideration for business-as-usual operations in order to minimize 
burden.
    Although MRV plan approval would be an inherently EPA function, the 
Agency is considering approaches and processes to streamline and 
facilitate external technical input in the development of specific 
evaluation criteria or guidelines, particularly at the outset of the 
program. EPA recognizes that an adaptive approach to the GS portion of 
this proposal will be necessary to take advantage of the experience 
gained in developing and implementing MRV plans and in complying with 
the proposed UIC Class VI requirements. EPA expects to update the 
guidelines and requirements of an MRV plan over time as technologies, 
methodologies, and scientific understanding of GS evolve; and the 
Agency believes that the site-specific nature of the MRV plan enables 
the proposed approach to adapt and improve over time.

E. Selection of Schedule and Process for Reporting

1. First Tier Reporting Requirements for Injection Facilities
    All injection facilities that meet the definitions in subpart RR 
and that are in active operation when this proposed rule is finalized 
would begin collecting data on CO2 injected, CO2 
transferred from offsite, and source of CO2, if known, on 
January 1, 2011, covering a period between January 1 to December 31. 
Data would be submitted to EPA by operating facilities in an annual 
report on each March 31 of each calendar year, beginning with March 31, 
2012, for data collected in the previous calendar year.
    The Agency plans to issue the final rule in sufficient time for 
existing injection facilities to prepare for monitoring and reporting 
before January 1, 2011, and to begin monitoring CO2 
injection and CO2 transferred from offsite on January 1, 
2011. Preparation would include studying the final rule, determining 
whether it applies to the facility, identifying the requirements with 
which the facility must comply, and preparing to monitor and collect 
the required data needed to calculate and report GHG emissions. 
However, EPA recognizes that meeting that goal may be challenging and 
seek comments on alternative effective dates.
    The date on which a new facility begins injecting CO2 is 
the date on which a new facility must begin monitoring the first tier 
of requirements for subpart RR. The annual report submitted by the new 
facility on March 31 of the year following start-up therefore may 
include data for only part of the year.
2. Second Tier Reporting Requirements for GS Facilities--Submission, 
Approval, and Reporting
    EPA is proposing that all GS facilities and any injection 
facilities that opt-in to the GS monitoring and reporting requirements 
would submit MRV plans to EPA and seek EPA approval. Where the GS 
facility would be relying on a new UIC Class VI permit for MRV plan 
requirements, EPA anticipates that the MRV plan review would be 
conducted concurrently with the UIC Class VI permit review. EPA would 
require the unique identification number associated with the permit 
application and notification of approval of the UIC Class VI permit. 
Once an MRV plan is approved by EPA, the GS facility would implement it 
and then begin collecting data on CO2 emitted and 
CO2 sequestered. Finally, the reporter would include this 
additional quantitative data in the first annual report submitted to 
EPA after the approved MRV plan has been implemented and in all 
subsequent annual reports. An annual report addendum would also be 
required to be submitted if the GS facility triggered any of the 
addendum submission requirements outlined in this proposal.
    The Agency seeks to establish an MRV plan submission and approval 
schedule that allows the GS facility reporter to implement its plan 
without delay. Therefore, EPA is proposing a rolling schedule for 
submission of the MRV plan to EPA whereby the reporter could submit the 
plan to EPA on any calendar date. From the date submitted, EPA would 
determine if the application is complete, review the plan, work with 
each reporter to ensure that the MRV plan appropriately addresses the 
requirements, and revise the plan accordingly. This interactive process 
would be limited to a reasonable time period, after which EPA would 
approve a revised MRV plan.
    EPA is proposing to provide for an appeal process in situations 
where the GS facility does not agree with the Agency's approved plan. 
One option would be for a reporter to request a formal administrative 
review (and if appropriate, an evidentiary hearing) with the 
Environmental Appeals Board using the appeal procedures provided in 40 
CFR Part 78. Under this approach, filing an appeal and exhausting all 
administrative remedies would be a prerequisite to seeking judicial 
review. Another option would allow the reporter to appeal directly with 
the appropriate court, pursuant to CAA section 307(b)(1). EPA seeks 
comment on both options for resolving disputes regarding MRV plans, or 
whether any alternative, expedited process is more appropriate.
    EPA is proposing that the GS facility must begin implementing the 
MRV plan within thirty days of EPA approval. Because implementation may 
require more than thirty days (e.g., in order to establish 
environmental baselines), it is possible that implementation would not 
be completed within 30 days of EPA approval, depending on the MRV plan; 
the facility would follow implementation as set forth in the facility's 
MRV plan. If the MRV plan is appealed, EPA is proposing to require the 
GS facility to begin implementation of the approved plan until such a 
time that the MRV plan appeal process is complete. EPA seeks comment on 
whether the implementation of the MRV plan should be delayed until the 
appeal is resolved.
    Every annual report submitted by the GS facility after MRV plan 
implementation begins would include both the first tier of data 
required of all CO2 injection facilities and the second tier 
of data related to GS. In the first year following initial MRV plan 
implementation, it is possible that the GS-related data collected and 
reported may only cover part of the year.
    EPA is proposing that an injection facility opting in to the GS 
portion of this proposed rule may submit an MRV plan at any time. All 
other GS facilities will be required to submit an MRV plan to EPA (A) 
within six months from the time that their UIC permitting authority 
confirms the area of review or (B) by December 31 of the year that the 
UIC permitting authority confirms the area of review, whichever date is 
later. If such facilities already have a UIC permit as of the date of 
publication of the final subpart RR in the Federal Register, they must 
submit the MRV plan to EPA within six months of the date of publication 
of this subpart. This submission deadline would allow the facility to 
implement all monitoring required by EPA as quickly and seamlessly as 
possible, and in parallel with a facility's UIC permit requirements. 
All facilities that are required to submit an MRV plan to EPA will be 
allowed to request an extension of up to an additional six months. In 
the case of a facility that is not under the jurisdiction of the SDWA, 
the MRV plan submission schedule would be based on the facility's 
relevant permit, rather than a UIC permit. EPA seeks comment on this 
approach for MRV plan submissions and on whether an alternative 
deadline, such as a submission deadline based on when a

[[Page 18594]]

GS facility's UIC permit is issued, would be more appropriate and 
efficient.
    EPA seeks comment on the proposed rolling submission process and 
whether an alternative would be more appropriate. For example, GS 
facilities (both required and opt-in facilities) could be required to 
submit an MRV plan by a specific date or within a specific window of 
time each calendar year if they plan to begin operating in the 
subsequent calendar year.
3. Second Tier Reporting Requirements for GS Facilities--Post 
Implementation
    Once a reporter begins implementing an EPA-approved MRV plan, it 
may be required to submit additional information to EPA, either through 
an annual report addendum, or through re-submitting a revised MRV plan 
for EPA approval.
    When a reporter initially develops an MRV plan, it does so based on 
its existing understanding of the GS facility site characterization and 
in some cases previous experience with CO2 injection, 
modeling, and monitoring. When EPA reviews the plan, it evaluates 
whether the procedures proposed will result in the most effective 
collection of data possible and practical, given this existing 
understanding. However, EPA recognizes that a reporter's understanding 
of the GS facility may evolve because of new information or altered 
site conditions. Under these circumstances, the site should continue to 
prioritize the most effective collection of data possible and 
practical, even if it requires an adjustment in the monitoring 
procedures used. The site would implement these adjustments as needed 
and would inform EPA about them via an annual report addendum, 
submitted at the same time as the next annual report (March 31 of the 
subsequent calendar year). An annual report addendum should also 
describe changes to the spatial area of monitoring. Data reporting 
should not be disrupted as a result. EPA is proposing that the annual 
report addendum will not require EPA approval.
    A reporter would also be required to submit an annual report 
addendum if leakage is detected. The addendum should outline the 
procedures or equipment that detected the leakage, what assumptions 
were made to quantify the detected leakage to the surface, including 
assumptions about when the leak began and the duration of the leak, and 
any adjustment made to the MRV plan. If the number reported for leakage 
represents more than one leakage event, the addendum should describe 
how each leak was detected and quantified.
    In general, the MRV plan should be revised as experience is gained 
over the course of the project (for example, as monitoring results are 
used to validate and update model predictions) and should keep pace 
with the development of monitoring instruments and methods. These 
revisions will be shared with EPA through annual report addenda.
    EPA seeks comment on whether the GS facility should resubmit an MRV 
plan at a minimum frequency that compiles all revisions over the 
previous years into one updated document and that undergoes an EPA 
approval process. EPA seeks comment on whether such a routine 
resubmission is appropriate, and if so how the minimum frequency for 
re-submittal should be established. This minimum frequency could be a 
fixed number for all facilities, such as every ten years. 
Alternatively, it could be established on a site-by-site basis based on 
the reporter's technical justification or on the minimum frequency 
associated with the re-evaluation of the facility's spatial area of 
evaluation.
    EPA is proposing that the MRV plan must be revised and re-submitted 
to EPA for approval if the reporter is out of compliance with its UIC 
permit (or relevant permit in the case of a facility that is not under 
the jurisdiction of the SDWA), or if EPA deems a resubmission necessary 
as the result of an annual report addendum received or an EPA on-site 
audit conducted as part of the MRR verification provisions. EPA seeks 
comment on whether any other events or conditions should require 
resubmission of the MRV plan. In addition, EPA is proposing that the GS 
facility under its own volition could submit a revised MRV plan in any 
reporting year. Resubmitted MRV plans would be accepted on a rolling 
basis just as initial MRV plans.
4. Annual Reports
    For this proposed rule, EPA seeks quantitative data from all 
facilities in a consistent format and at a consistent level, in a 
timely fashion at the beginning of every reporting year (covering the 
previous year's data) in order to electronically verify the data, 
publish it as authorized by the CAA, and use the collected information 
for the purposes described in this proposal. Therefore, EPA is 
proposing that, as with the other data reported in the MRR, 
CO2 injection and sequestration data would be reported 
directly to EPA electronically via an annual report. EPA is also 
proposing that MRV plans and annual report addenda developed by GS 
facilities would be submitted electronically to EPA. To minimize 
redundancy and burden on industry, EPA has considered the procedures, 
methodologies, units, quality assurance and quality control (QA/QC) 
requirements, and formats required under the UIC permit classes when 
developing the requirements of this proposed rule. EPA's intention is 
that reporters use the same data to meet the reporting requirements of 
both programs to the greatest extent possible.
    All injection facilities would submit reports with quantitative 
data annually on an ongoing basis. The snapshot of information provided 
by a one-time information collection request would not provide the type 
of ongoing information which could inform the variety of potential 
policy options being evaluated for addressing climate change. Due to 
the comprehensive reporting and monitoring requirements in this 
proposal, the Agency has concluded that it is not appropriate to 
require reporting of historical emissions data. EPA proposed and 
evaluated comments on this reporting provision under the MRR. The 
historical data provision of the MRR also applies to today's proposed 
rule.
    Most voluntary and mandatory GHG reporting programs include 
provisions for operators to revise previously submitted data. Under the 
final MRR, EPA requires the reporter to submit a revised report within 
45 days of discovering or being notified by EPA of errors in an annual 
GHG report. The revised report must correct all identified errors. The 
reporter must retain documentation for three years to support any 
revisions made to an annual GHG report. EPA proposed and evaluated 
comments on this reporting provision under the MRR. As a final 
provision of that rule, the requirement to submit a correct report 
within 45 days and retention of documentation for three years applies 
to today's rule.
    The final MRR provides a mechanism for facilities to exit the 
reporting program when they are below a reporting threshold for five or 
three consecutive years, depending on the exact emissions levels. 
Because of the unique nature of CO2 injection and GS 
activities as noted in the threshold analysis discussion in Section 
II.B of this preamble, EPA is proposing that this provision would not 
apply to GS facilities. Instead, EPA is proposing that all 
CO2 injection facilities would be allowed to cease reporting 
CO2 injection upon the plugging of the injection well or 
wells that constitute the facility. GS facilities will be allowed to 
cease all other reporting requirements under this

[[Page 18595]]

subpart once the CO2 plume and pressure front have 
stabilized. EPA will accept demonstrations made to fulfill UIC Class VI 
permit requirements in order to meet requirements for ceasing GS 
reporting under this proposal. EPA seeks comment on this approach for 
allowing facilities to cease reporting. EPA recognizes that there are 
other possible approaches. For example, the Agency could conform the 
mechanism that other facilities use for exiting the MRR to subpart RR, 
allowing CO2 injection facilities that are not GS facilities 
to cease reporting if they are below an injection threshold for five or 
three consecutive years, depending on the exact injection levels. EPA 
did not propose this alternative because of a lack of data on the 
incidence and scale of surface emissions and leakage. Another approach 
would be to provide a ``no exit'' approach for GS facilities, which 
would allow EPA to obtain valuable data on the long-term efficacy of 
GS. EPA is not proposing a ``no exit'' approach because the Agency 
wanted to provide an opportunity for reporters to cease reporting. 
However, EPA seeks comment on these alternative approaches for allowing 
facilities to cease reporting.
    Each annual report developed under this proposed rule would contain 
a signed certification by a Designated Representative of the facility. 
On behalf of the reporter, the Designated Representative would certify 
under penalty of law that the report has been prepared in accordance 
with the requirements of 40 CFR part 98 and that the information 
contained in the report is true and accurate, based on a reasonable 
inquiry of individuals responsible for obtaining the information. EPA 
proposed and evaluated comments on these reporting provisions under the 
MRR. As final provisions of the MRR, they apply to today's proposal.
5. Data Verification
    In the MRR, EPA will verify emissions data electronically using 
numerous approaches such as: Executing equations and comparing the 
results to reported data; comparing reported data to a realistic data 
range; comparing trends in reported data across years; comparing data 
from one year across reporters; conducting a pass/fail check on binary 
data; collecting secondary data that can proxy emissions; and 
conducting statistical analysis to identify outliers. EPA may conduct 
selective audits on facilities whose data raises questions during the 
verification process. In addition, all reporting entities will select a 
Designated Representative to certify that the data reported is accurate 
to the best of his/her knowledge.
    For this proposed rule, EPA is proposing that the data submitted by 
GS facilities may be evaluated and verified manually by EPA along with 
the qualitative contents of the MRV plan (see Section II.D of this 
preamble). It may be that electronic verification of GS data would not 
be adequate to verify whether the EPA-approved MRV plan was followed 
and whether any leakage was detected in the reporting year at a 
particular facility. EPA seeks comment on manual evaluation of data and 
qualitative elements of an MRV plan.
6. Confidential Business Information (CBI)
    EPA's public information regulations contain a definition of 
``emissions data'' at 40 CFR 2.301, and EPA has discussed in an earlier 
Federal Register notice what data elements constitute emissions data 
that cannot be withheld as CBI (56 FR 7042-7043, February 21, 1991). 
While determinations about whether information claimed as CBI and 
whether the information meets the definition of emissions data are 
usually made on a case-by-case basis, EPA recognizes that such an 
approach would be cumbersome given the scope of the MRR and the 
compelling need to make data that are not CBI, or are emissions data, 
available to the public. For this reason, EPA will be initiating a 
separate notice and comment process to make CBI and emissions data 
determinations for the categories of data collected under the MRR.
    As stated in the MRR, EPA will protect any information claimed as 
CBI in accordance with regulations in 40 CFR part 2, subpart B. 
However, in general, emissions data collected under CAA section 114 
shall be available to the public and cannot be withheld as CBI.

F. Selection of Procedures for Estimating Missing Data

    EPA has concluded that it is important to have missing data 
procedures in order to ensure a complete report of amounts of 
CO2 and emissions from a particular facility. In this rule, 
EPA is proposing missing data procedures for the quarterly values of 
mass or volume and concentration of these streams, and CO2 
transferred from offsite. EPA is proposing that these procedures can be 
used by all injection facilities, including GS facilities. EPA is also 
proposing procedures for missing data on CO2 production from 
GS facilities. EPA seeks comment on these procedures and on whether it 
is appropriate to provide missing data procedures for GS facilities.
    EPA is not proposing missing data procedures for leakage 
quantification. EPA is proposing that the MRV plan include 
quantification methods and assumptions for all potential leakage 
scenarios. If leakage is detected for which a quantification approach 
is not outlined in the plan, this information must be included in the 
addendum.

G. Selection of Records To Retain

    EPA is proposing that, in addition to the records required by Sec.  
98.3(g), each facility must retain quarterly records of injected 
CO2 and CO2 transferred from offsite sources, 
including mass flow or volumetric flow at standard conditions and 
operating conditions, operating temperature and pressure, and 
concentration of these streams. EPA is proposing that GS facilities 
would also retain quarterly records of produced CO2, if 
applicable, including mass flow or volumetric flow at standard 
conditions and operating conditions, operating temperature and 
pressure, and concentration of these streams; annual records of the 
emitted CO2 from subsurface geologic formation leakage 
pathways; and any other records as outlined for retention in your MRV 
plan. EPA seeks comment on these record retention requirements.

III. Economic Impacts of the Proposed Rule

    This section of the preamble examines the costs and economic 
impacts of the proposed rulemaking for CO2 injection and GS 
and the estimated economic impacts of the rule on affected entities, 
including estimated impacts on small entities. Complete detail of the 
economic impacts of the proposed rule can be found in the text of the 
economic impact analysis (EIA) (EPA-HQ-OAR-2009-0926). EPA seeks 
comment on the methodology and data used for the analysis.

A. How were compliance costs estimated?

1. Summary of Method Used To Estimate Compliance Costs
    EPA estimated costs of complying with this proposed rule and the 
total incremental annual cost of compliance. A base case is created 
assuming relevant monitoring costs required under UIC requirements 
(including the UIC Class VI proposal). Then incremental reporting from 
geologic storage sites were evaluated in terms required technologies, 
practices, and costs.
    The estimated costs include capital and operating and maintenance 
(O&M)

[[Page 18596]]

including labor costs. The cost of drilling and equipping wells 
represents a large component of sequestration costs. Examples of other 
costs include seismic data acquisition, periodic sampling and testing 
of the injected CO2.
    The estimated costs are based on hypothetical or pro-forma sites 
for various types of projects such as R&D GS projects, commercial 
saline formation projects, and ER GS projects. The geologic and 
engineering assumptions for these pro-forma projects are the same as 
those used by the EPA Office of Water in the proposed UIC Class VI rule 
for CO2 injection wells. The costs are presented in 2008 
dollars.
    The capital costs are annualized using an interest rate of 7% with 
projects lasting 7 years or 20 years. Next, annual O&M costs are added 
to the annualized capital costs to determine total annual direct costs. 
Finally, a 20 percent overhead and general and administrative cost 
factor is added to obtain total annual costs. These are then divided by 
the amount assumed to be injected each year in the pro-forma project to 
arrive at total costs per metric ton of CO2 injected. These 
per-ton costs are then used to estimate total annual costs for the 
level of injection expected in the activity baseline.

B. What are the costs of the proposed rule?

1. Summary of Costs
    The total annualized costs incurred under the rule by these 
entities would be approximately $714,000 ($2008 dollars), as 
illustrated in Table 7 of this preamble. The public sector burden 
estimate is $344,000 for program implementation and verification 
activities. This may underestimate the total public sector burden 
depending on the extent to which DOE R&D projects funded with public 
dollars transition to demonstration or commercial GS, and consequently 
incur costs associated with monitoring, reporting and verification. 
Given uncertainties related to project adoption and the costs of the 
reporting program, EPA considered two other private cost scenarios (one 
higher and one lower than the reference cost scenario) in order to 
assess a range of economic impacts on affected entities, as illustrated 
in table 8 of this preamble.

              Table 7--National Annualized Mandatory Reporting Costs Estimates (2008$): Subpart RR
----------------------------------------------------------------------------------------------------------------
                                                                                                   Total annual
                                                                     Number of      Metric tons        cost
                               Type                                  projects      CO2 injected     (thousand,
                                                                                     per year         2008$)
----------------------------------------------------------------------------------------------------------------
R&D.............................................................               9       5,320,000              37
CO2 Injection Facilities (no GS) \1\............................              80      36,815,442             332
Private Sector, Total All Projects..............................              89      45,435,442             369
Private Sector, Average ($/ton).................................  ..............  ..............            0.01
Public Sector, Total............................................  ..............  ..............             344
National Total..................................................  ..............  ..............             714
----------------------------------------------------------------------------------------------------------------
\1\ Includes Class II ER Facilities.


                       Table 8--Annualized Reporting Costs per Project (2008$): Subpart RR
----------------------------------------------------------------------------------------------------------------
                                                                                      Average
                                                                 -----------------------------------------------
                                                                                    Alternative cost scenarios
                              Type                               -----------------------------------------------
                                                                     Reference
                                                                     ($1,000)      Low  ($1,000)  High  ($1,000)
----------------------------------------------------------------------------------------------------------------
GS Facilities (commercial saline) \1\...........................             289               7             470
GS Facilities (ER opt in).......................................           1,679           1,485           1,804
CO2 Injection Facilities \1\....................................               4               4               4
----------------------------------------------------------------------------------------------------------------
\1\ Includes Class II ER Facilities.

C. What are the economic impacts of the proposed rule?

1. Summary of Economic Impacts
    EPA assessed how the regulatory program may influence the 
profitability of companies by comparing the monitoring program costs to 
total sales (i.e., a ``sales'' test). Given limited data on commercial 
GS operations, EPA restricted the analysis to ER operations 
(approximately 90 percent of the fields). To do this, EPA divided the 
average annualized mandatory reporting costs per field by the estimated 
revenue for a representative field. Sales test ratios are between 3.1 
to 3.3 percent for GS facilities (ER opt in). In contrast, ER 
CO2 injection facilities (no GS) sales test ratios are below 
0.01 percent, as illustrated in Table 9 of this preamble.

          Table 9--Estimated Annual Revenue for a Representative Commercial ER Field Operation (2008$)
----------------------------------------------------------------------------------------------------------------
                                                                            Cost-to-Sales Ratios (CSRs)
                                                                 -----------------------------------------------
                                                                                    Alternative cost scenarios
                                                                 -----------------------------------------------
                                                                     Reference
                                                                     (percent)     Low (percent)  High (percent)
----------------------------------------------------------------------------------------------------------------
GS Facilities (ER opt in).......................................             3.1             2.7             3.3
CO2 Injection Facilities (no GS) \1\............................           <0.01           <0.01           <0.01
----------------------------------------------------------------------------------------------------------------
\1\ Includes Class II ER Facilities.


[[Page 18597]]

D. What are the impacts of the proposed rule on small businesses?

1. Summary of Impacts on Small Businesses
    As required by the RFA and SBREFA, EPA assessed the potential 
impacts of the rule on small entities (small businesses, governments, 
and non-profit organizations). (See Section IV.C of this preamble for 
definitions of small entities.)
    After considering the economic impact of the rule on small 
entities, EPA has concluded that this action will not have a 
significant economic impact on a substantial number of small entities. 
Currently EPA believes small ER operations will most likely be UIC 
Class II ER projects. As shown in Table 9 of this preamble, the average 
ratio of annualized reporting program costs to revenues of a typical ER 
operation likely owned by a representative small enterprise was less 
than 0.1%.
    Although this rule will not have a significant economic impact on a 
substantial number of small entities, EPA nonetheless took several 
steps to reduce the impact of this rule on small entities. For example, 
EPA is proposing monitoring and reporting requirements that build off 
of the UIC program. In addition, EPA is proposing equipment and methods 
that may already be in use by a facility for compliance with its UIC 
permit. Also, EPA is requiring annual reporting instead of more 
frequent reporting.
    In addition to the public hearing that EPA plans to hold, EPA has 
an open door policy, similar to the outreach conducted during the 
development of the proposed and final MRR. Details of these meetings 
are available in the docket (EPA-HQ-OAR-2009-0926).

E. What are the benefits of the proposed rule for society?

    EPA examined the potential benefits of this proposed rule. EPA's 
previous analysis of the MRR discussed the benefits of a reporting 
system with respect to policy making relevance, transparency issues, 
market efficiency. Instead of a quantitative analysis of the benefits, 
EPA conducted a systematic literature review of existing studies 
including government, consulting, and scholarly reports.
    The greatest benefit of mandatory reporting of industry GHG 
emissions to government will be realized in developing future GHG 
policies. For example, in the EU's Emissions Trading System, a lack of 
accurate monitoring at the facility level before establishing 
CO2 allowance permits resulted in allocation of permits for 
emissions levels an average of 15 percent above actual levels in every 
country except the United Kingdom.
    Benefits to industry of GHG emissions monitoring include the value 
of having independent, verifiable data to present to the public to 
demonstrate appropriate environmental stewardship, and a better 
understanding of their emission levels and sources to identify 
opportunities to reduce emissions. Such monitoring allows for inclusion 
of standardized GHG data into environmental management systems, 
providing the necessary information to achieve and disseminate their 
environmental achievements.
    Standardization will also be a benefit to industry, once facilities 
invest in the institutional knowledge and systems to report emissions, 
the cost of monitoring should fall and the accuracy of the accounting 
should improve. A standardized reporting program will also allow for 
facilities to benchmark themselves against similar facilities to 
understand better their relative standing within their industry.

IV. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Section 3(f)(1) of Executive Order 12866 (58 FR 51735, 
October 4, 1993), this proposed action is not by itself an 
``economically significant regulatory action'' because it is unlikely 
to have an annual economic effect of less than $100 million. EPA's cost 
analysis, presented in Section 4 of the EIA, estimates that for the 
minimum reporting under the recommended regulatory option, the total 
annualized cost of the rule will be approximately $713,000 (in 2008$) 
during the first year of the program and $713,000 in subsequent years 
(including $0.3 million of programmatic costs to the Agency). This 
proposed action adds subpart RR to the MRR, which was a significant 
regulatory action. Thus, EPA has chosen to analyze the impacts of 
subpart RR as if it were significant. EPA submitted this proposed 
action to the Office of Management and Budget (OMB) for review under 
Executive Order 12866, and any changes made in response to OMB 
recommendations have been documented in the docket for this proposed 
action.
    In addition, EPA prepared an analysis of the potential costs 
associated with this proposed action. This analysis is contained in the 
``Economic Impact Analysis for the Mandatory Reporting of Greenhouse 
Gas Emissions Subpart RR'' (EPA-HQ-OAR-2009-0926). A copy of the 
analysis is available in the docket for this action and the analysis is 
briefly summarized here. In this report, EPA has identified the 
regulatory options considered, their costs, the emissions that would 
likely be reported under each option, and explained the selection of 
the option chosen for the rule. Overall, EPA has concluded that the 
costs of this proposed rule are outweighed by the potential benefits of 
more comprehensive information about GHGs.

B. Paperwork Reduction Act

    The information collection requirements in this proposed rule have 
been submitted for approval to the Office of Management and Budget 
(OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The 
Information Collection Request (ICR) document prepared by EPA has been 
assigned EPA ICR number 2372.01.
    EPA has identified the following goals of the mandatory reporting 
system, including:
     Obtain data that is of sufficient quality that it can be 
used to analyze and inform the development of a range of future climate 
change policies and potential regulations.
     Balance the rule's coverage to maximize the amount of 
emissions reported while excluding small emitters.
     Create reporting requirements that are, to the extent 
possible and appropriate, consistent with existing GHG reporting 
programs in order to reduce reporting burden for all parties involved.
    The information from CO2 injection and GS facilities 
will allow EPA to make well-informed decisions about whether and how to 
use the CAA to regulate these facilities and encourage voluntary 
reductions. Because EPA does not yet know the specific policies that 
will be adopted, the data reported through the mandatory reporting 
system should be of sufficient quality to inform policy and program 
development. Also, consistent with the Appropriations Act, the 
reporting rule covers a broad range of sectors of the economy.
    This information collection is mandatory and will be carried out 
under CAA section 114. Information identified and marked as 
Confidential Business Information (CBI) will not be disclosed except in 
accordance with procedures set forth in 40 CFR Part 2. However, 
emissions information collected under CAA section 114 generally cannot 
be claimed as CBI and will be made public.\39\
---------------------------------------------------------------------------

    \39\ Although CBI determinations are usually made on a case-by-
case basis, EPA has issued guidance in an earlier Federal Register 
notice on what constitutes emissions data that cannot be considered 
CBI (956 FR 7042-7043, February 21, 1991). As discussed in Section 
II.R of the Final MRR preamble, EPA will be initiating a separate 
notice and comment process to make CBI determinations for the data 
collected under this proposed rulemaking.

---------------------------------------------------------------------------

[[Page 18598]]

    The projected ICR cost and respondent burden is $0.8 million and 
4,510 hours per year. The estimated average burden per response is 6.8 
hours; the frequency of response is annual for all respondents that 
must comply with the rule's reporting requirements, except for 
electricity-generating units that are already required to report 
quarterly under 40 CFR Part 75 (acid rain program); and the estimated 
average number of likely respondents per year is 89. The cost burden to 
respondents resulting from the collection of information includes the 
total capital and start-up cost annualized over the equipment's 
expected useful life (averaging $0.1 million per year) a total 
operation and maintenance component (averaging $0.3 million per year), 
and a labor cost component (averaging $0.3 million per year). Burden is 
defined at 5 CFR 1320.3(b).
    These cost numbers differ from those shown elsewhere in the EIA 
because ICR costs represent the average cost over the first three years 
of the rule, but costs are reported elsewhere in the EIA for the first 
year of the rule. Also, the total cost estimate of the rule in the EIA 
includes the cost to the Agency to administer the program. The ICR 
differentiates between respondent burden and cost to the Agency.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR Part 9. When this ICR is 
approved by OMB, the Agency will publish a technical amendment to 40 
CFR part 9 in the Federal Register to display the OMB control number 
for the approved information collection requirements contained in the 
final rule.
    To comment on the Agency's need for this information, the accuracy 
of the provided burden estimates, and any suggested methods for 
minimizing respondent burden, EPA has established a public docket for 
this proposed rule, which includes this ICR, under Docket ID number 
EPA-HQ-OAR-2009-0926. Submit any comments related to the ICR to EPA and 
OMB. See ADDRESSES section at the beginning of this notice for where to 
submit comments to EPA. Send comments to OMB at the Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
725 17th Street, NW., Washington, DC 20503, Attention: Desk Office for 
EPA. Since OMB is required to make a decision concerning the ICR 
between 30 and 60 days after [date of publication], a comment to OMB is 
best assured of having its full effect if OMB receives it by 
[publication plus 30]. The final rule will respond to any OMB or public 
comments on the information collection requirements contained in this 
proposal.

C. Regulatory Flexibility Act (RFA)

    The RFA generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice and comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small organizations, and small 
governmental jurisdictions.
    For purposes of assessing the impacts of today's rule on small 
entities, small entity is defined as: (1) A small business as defined 
by the Small Business Administration's regulations at 13 CFR 121.201; 
(2) a small governmental jurisdiction that is a government of a city, 
county, town, school district or special district with a population of 
less than 50,000; and (3) a small organization that is any not-for-
profit enterprise which is independently owned and operated and is not 
dominant in its field. Currently EPA believes small ER operations will 
most likely be CO2 injection facilities, including Class II 
ER projects. The average ratio of annualized reporting program costs to 
revenues of a typical ER operation likely owned by representative small 
enterprises is less than 1%
    After considering the economic impacts of today's proposed rule on 
small entities, I therefore certify that this proposed rule will not 
have a significant economic impact on a substantial number of small 
entities.
    Although this rule will not have a significant economic impact on a 
substantial number of small entities, EPA nonetheless took several 
steps to reduce the impact of this rule on small entities. For example, 
EPA is proposing monitoring and reporting requirements that build off 
of the UIC program. In addition, EPA is proposing equipment and methods 
that may already be in use by a facility for compliance with its UIC 
permit. Also, EPA is requiring annual reporting instead of more 
frequent reporting. In addition to the public hearing that EPA plans to 
hold, EPA has an open door policy, similar to the outreach conducted 
during the development of the proposed and final MRR. Details of these 
meetings are available in the docket (EPA-HQ-OAR-2009-0926).

D. Unfunded Mandates Reform Act (UMRA)

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. 
L. 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under Section 202 of the UMRA, EPA 
generally must prepare a written statement, including a cost-benefit 
analysis, for final rules with ``Federal mandates'' that may result in 
expenditures to State, local, and tribal governments, in the aggregate, 
or to the private sector, of $100 million or more in any one year.
    This proposed rule does not contain a Federal mandate that may 
result in expenditures of $100 million or more for State, local, and 
tribal governments, in the aggregate, or the private sector in any one 
year. Overall, EPA estimates that the total annualized costs of this 
proposed rule are approximately $713,000 per year. Thus, this proposed 
rule is not subject to the requirements of sections 202 or 205 of UMRA.
    This proposed rule is also not subject to the requirements of 
section 203 of UMRA because it contains no regulatory requirements that 
might significantly or uniquely affect small governments. Facilities 
subject to the proposed rule include facilities that inject 
CO2 for enhanced recovery of crude oil, and those intending 
to sequester CO2. None of the facilities currently known to 
undertake these activities are owned by small governments.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in Executive Order 13132. This regulation applies directly to 
facilities that inject CO2 underground. Few, if any, State 
or local government facilities would be affected. This regulation also 
does not limit the power of States or localities to collect GHG data 
and/or regulate GHG emissions. Thus, Executive Order 13132 does not 
apply to this action.

[[Page 18599]]

    In the spirit of Executive Order 13132, and consistent with EPA 
policy to promote communications between EPA and State and local 
governments, EPA specifically solicits comment on this proposed action 
from State and local officials.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (59 FR 22951, November 6, 2000), 
requires EPA to develop an accountable process to ensure ``meaningful 
and timely input by tribal officials in the development of regulatory 
policies that have tribal implications.''
    This proposed rule is not expected to have tribal implications, as 
specified in Executive Order 13175. This regulation applies to 
facilities that inject CO2 underground. Few facilities 
expected to be affected by the rule are likely to be owned by tribal 
governments. Thus, Executive Order 13175 does not apply to this 
proposed rule.
    Although Executive Order 13175 does not apply to this proposed 
rule, EPA sought opportunities to provide information to tribal 
governments and representatives during development of the MRR. In 
consultation with EPA's American Indian Environment Office, EPA's 
outreach plan included tribes. During the proposal phase, EPA staff 
provided information to tribes through conference calls with multiple 
Indian working groups and organizations at EPA that interact with 
tribes and through individual calls with two tribal board members of 
TCR. In addition, EPA prepared a short article on the GHG reporting 
rule that appeared on the front page of a tribal newsletter--Tribal Air 
News--that was distributed to EPA/Office of Air Quality Planning & 
Standards' network of tribal organizations. EPA gave a presentation on 
various climate efforts, including the MRR, at the National Tribal 
Conference on Environmental Management in June, 2008. In addition, EPA 
had copies of a short information sheet distributed at a meeting of the 
National Tribal Caucus. EPA participated in a conference call with 
tribal air coordinators in April 2009 and prepared a guidance sheet for 
Tribal governments on the proposed rule. It was posted on the MRR Web 
site and published in the Tribal Air Newsletter. For a complete list of 
tribal contacts, see the ``Summary of EPA Outreach Activities for 
Developing the Greenhouse Gas Reporting Rule,'' in the MRR Docket (EPA-
HQ-OAR-2008-0508-055). In addition to the consultation activities 
supporting the MRR, EPA continues to provide requested information to 
tribal governments and representatives during development of MRR source 
categories that have not been finalized (Track II rules) such as this 
proposed rulemaking. EPA specifically solicits additional comment on 
this proposed action from tribal officials.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying 
only to those regulatory actions that concern health or safety risks, 
such that the analysis required under section 5-501 of the EO has the 
potential to influence the regulation. This proposed action is not 
subject to EO 13045 because it does not establish an environmental 
standard intended to mitigate health or safety risks.

H. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This proposed rule is not a ``significant energy action'' as 
defined in EO 13211 (66 FR 28355, May 22, 2001) because it is not 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy. Further, EPA has concluded that this 
proposed rule is not likely to have any adverse energy effects. This 
proposed rule relates to monitoring, reporting and recordkeeping at 
facilities that inject CO2 underground and does not impact 
energy supply, distribution or use. Therefore, EPA concludes that this 
proposed rule is not likely to have any adverse effects on energy 
supply, distribution, or use.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113 (15 U.S.C. 272 note) directs 
EPA to use voluntary consensus standards in its regulatory activities 
unless to do so would be inconsistent with applicable law or otherwise 
impractical. Voluntary consensus standards are technical standards 
(e.g., materials specifications, test methods, sampling procedures, and 
business practices) that are developed or adopted by voluntary 
consensus standards bodies. NTTAA directs EPA to provide Congress, 
through OMB, explanations when the Agency decides not to use available 
and applicable voluntary consensus standards.
    This proposed rulemaking involves technical standards. EPA will use 
voluntary consensus standards from at least seven different voluntary 
consensus standards bodies, including the following: American Society 
for Testing and Materials (ASTM), American Society of Mechanical 
Engineers (ASME), International Standards Organization (ISO), Gas 
Processors Association, American Gas Association, American Petroleum 
Institute, and National Lime Association. These voluntary consensus 
standards will help facilities monitor, report, and keep records of 
CO2 injections or geologic sequestration, and any associated 
GHG emissions. No new test methods were developed for this proposed 
rule. Instead, from existing rules for source categories and voluntary 
greenhouse gas programs, EPA identified existing means of monitoring, 
reporting, and keeping records of greenhouse gas emissions. The 
existing methods (voluntary consensus standards) include a broad range 
of measurement techniques, such as methods to measure gas or liquid 
flow; and methods to gauge and measure petroleum and petroleum 
products. The test methods are incorporated by reference into the 
proposed rule and are available as specified in 40 CFR 98.7.
    By incorporating voluntary consensus standards into this proposed 
rule, EPA is both meeting the requirements of the NTTAA and presenting 
multiple options and flexibility in complying with the proposed rule. 
EPA welcomes comments on this aspect of the proposed rulemaking and, 
specifically, invites the public to identify potentially-applicable 
voluntary consensus standards and to explain why such standards should 
be used in this proposed regulation.

J. Executive Order 12898: Federal Actions to Address Environmental 
Justice in Minority Populations and Low-Income Populations

    EO 12898 (59 FR 7629, February 16, 1994) establishes Federal 
executive policy on environmental justice. Its main provision directs 
Federal agencies, to the greatest extent practicable and permitted by 
law, to make environmental justice part of their mission by identifying 
and addressing, as appropriate, disproportionately high and adverse 
human health or environmental effects of their programs, policies, and 
activities on minority populations and low-income populations in the 
United States.
    EPA has determined that this proposed rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations

[[Page 18600]]

because it does not affect the level of protection provided to human 
health or the environment. This proposed rule does not affect the level 
of protection provided to human health or the environment because it is 
a rule addressing information collection and reporting procedures.

List of Subjects in 40 CFR Part 98

    Environmental protection, Administrative practice and procedure, 
Greenhouse gases, Incorporation by reference, Air pollution control, 
Reporting and recordkeeping requirements.

    Dated: March 22, 2010.
Lisa P. Jackson,
Administrator.

    For the reasons stated in the preamble, title 40, chapter I, of the 
Code of Federal Regulations is proposed to be amended as follows:

PART 98--[AMENDED]

    1. The authority citation for part 98 continues to read as follows:

    Authority:  42 U.S.C. 7401, et seq.

Subpart A--[Amended]

    2. Section 98.2 is amended by revising paragraph (a) introductory 
text to read as follows:


Sec.  98.2  Who must report?

    (a) The GHG reporting requirements and related monitoring, 
recordkeeping, and reporting requirements of this part apply to the 
owners and operators of any facility that is located in the United 
States or under or attached to the Outer Continental Shelf (as defined 
in 43 U.S.C. 1331) and that meets the requirements of either paragraph 
(a)(1), (a)(2), or (a)(3) of this section; and any supplier that meets 
the requirements of paragraph (a)(4) of this section:
* * * * *
    3. Section 98.6 is amended by adding the following definitions in 
alphabetical order to read as follows:


Sec.  98.6  Definitions.

* * * * *
    Outer Continental Shelf means all submerged lands lying seaward and 
outside of the area of lands beneath navigable waters as defined in 43 
U.S.C. 1301, and of which the subsoil and seabed appertain to the 
United States and are subject to its jurisdiction and control.
* * * * *
    United States means the 50 States, the District of Columbia, the 
Commonwealth of Puerto Rico, American Samoa, the Virgin Islands, Guam, 
and any other Commonwealth, territory or possession of the United 
States, as well as the territorial sea as defined by Presidential 
Proclamation No. 5928.
* * * * *
    4. Section 98.7 is amended by revising paragraph (e)(39) to read as 
follows:


Sec.  98.7  What standardized methods are incorporated by reference 
into this part?

* * * * *
    (e) * * *
    (39) ASTM E1747-95 (Reapproved 2005) Standard Guide for Purity of 
Carbon Dioxide Used in Supercritical Fluid Applications, IBR approved 
for Sec.  98.424(b) and Sec.  98.444(a).
* * * * *
    5. Part 98 is amended by adding subpart RR to read as follows:

Sec.
98.440 Definition of the source category.
98.441 Reporting threshold.
98.442 GHGs to report.
98.443 Calculating CO2 Injection and Sequestration.
98.444 Monitoring and QA/QC requirements.
98.445 Procedures for estimating missing data.
98.446 Data reporting requirements.
98.447 Records that must be retained.
98.448 Geologic Sequestration Monitoring, Reporting, and 
Verification (MRV) Plan.
98.449 Definitions.

Subpart RR--Injection and Geologic Sequestration of Carbon Dioxide


Sec.  98.440  Definition of the source category.

    (a) The injection and geologic sequestration of carbon dioxide 
(CO2) source category comprises any well or group of wells 
that inject CO2 into the subsurface, which includes under a 
seabed offshore. The source category consists of all wells that inject 
CO2 into the subsurface, including wells for geologic 
sequestration (GS) or for any other purpose.
    (b) A facility that is subject to this rule only because of 
CO2 injection wells that do not meet the definition of 
geologic sequestration facility in paragraph (c) of this section is not 
required to report emissions under any other subpart of part 98.
    (c) Geologic sequestration (GS) facility.
    (1) For the purposes of this source category, a geologic 
sequestration facility is a facility that injects CO2 for 
the long-term containment of a gaseous, liquid, or supercritical 
CO2 stream in subsurface geologic formations. A facility 
that injects CO2 to enhance the recovery of oil or natural 
gas is not a geologic sequestration facility for the purposes of this 
source category unless the facility also injects the CO2 in 
subsurface geologic formations for long-term containment of a gaseous, 
liquid, or supercritical CO2 stream and chooses to submit a 
monitoring, reporting, and verification (MRV) plan to EPA that is then 
approved by EPA.
    (2) A facility that is not required to report for the purposes of 
this source category as a geologic sequestration facility, injects 
CO2 for the long-term containment of a gaseous, liquid, or 
supercritical CO2 stream in subsurface geologic formations, 
and chooses to submit an MRV plan to EPA that is then approved by EPA, 
is a geologic sequestration facility.
    (3) A geologic sequestration facility includes all structures 
associated with injection located between the points of CO2 
transfer onsite and the injection wells.
    (4) A geologic sequestration facility that injects CO2 
to enhance the recovery of oil or natural gas includes all structures 
associated with production located between the production wells and the 
separators.
    (d) This source category does not include the following:
    (1) Storage of CO2 above ground.
    (2) Temporary storage of CO2 below ground.
    (3) Transportation or distribution of CO2.
    (4) Purification, compression, or processing of CO2 at 
the surface.
    (5) Capture of CO2.
    (6) CO2 in cement, precipitated calcium carbonate (PCC), 
or any other technique that does not involve injection of 
CO2 into the subsurface.


Sec.  98.441  Reporting threshold.

    (a) You must report under this subpart if your facility is an 
injection facility that injects CO2 into the subsurface and 
the facility meets requirements of either Sec.  98.2(a)(1) or (a)(2).
    (b) The requirements of Sec.  98.2(i) do not apply to this subpart. 
Once a facility is subject to the requirements of this subpart, the 
owner or operator must continue for each year thereafter to comply with 
all requirements of this subpart, including the requirement to submit 
annual GHG reports, even if the facility does not meet the 
applicability requirements in paragraph (a) of Sec.  98.2(a) of this 
part in a future year, unless paragraphs (b)(1) or (b)(2) of this 
section apply.
    (1) If the injection well or wells constituting the facility are 
plugged in compliance with the facility's Underground Injection Control 
permit requirements (or relevant permit requirements, if any, in the 
case of a facility that is not under the jurisdiction

[[Page 18601]]

of the Safe Drinking Water Act), a facility conducting geologic 
sequestration subject to the requirements of this subpart may 
discontinue complying with Sec.  98.442(a) and Sec.  98.442(b) and all 
other facilities subject to the requirements of this subpart may 
discontinue complying with this subpart. The owner or operator of the 
facility must notify EPA that the injection well or wells constituting 
the facility have been plugged in compliance with the facility's 
Underground Injection Control permit requirements (or relevant permit 
requirements, if any, in the case of a facility that is not under the 
jurisdiction of the Safe Drinking Water Act), and such notification 
must be certified as accurate by the owner or operator of the facility. 
The owner or operator must resume reporting for any future calendar 
year during which any activities that are source categories of this 
subpart resume operation.
    (2) If the CO2 plume and pressure front have stabilized 
and the GS facility has been closed in compliance with the facility's 
Underground Injection Control permit requirements (or relevant permit 
requirements, if any, in the case of a facility that is not under the 
jurisdiction of the Safe Drinking Water Act), a facility conducting 
geologic sequestration may discontinue complying with the remainder of 
this subpart. The owner or operator of the facility must notify EPA 
that the CO2 plume and pressure front have stabilized and 
the GS facility has been closed in compliance with the facility's 
Underground Injection Control permit requirements (or relevant permit 
requirements, if any, in the case of a facility that is not under the 
jurisdiction of the Safe Drinking Water Act), and such notification 
must be certified as accurate by the owner or operator of the facility. 
The owner or operator must resume reporting for any future calendar 
year during which any activities that are source categories of this 
subpart resume operation.


Sec.  98.442  GHGs to report.

    You must report:
    (a) Mass of CO2 received onsite.
    (b) Mass of CO2 injected into the subsurface.
    (c) Facilities conducting geologic sequestration also report:
    (1) Mass of CO2 produced, if any.
    (2) Mass of CO2 sequestered in the subsurface geologic 
formation.
    (3) Mass of CO2 emitted from subsurface leaks.
    (4) Mass of fugitive and vented CO2 emissions from 
surface equipment at the facility if not reported under subpart W of 
this part.


Sec.  98.443  Calculating CO2 Injection and Sequestration.

    (a) A facility must calculate and report the annual mass of 
CO2 transferred to the facility from offsite sources using 
the procedures in paragraphs (a)(1), (a)(2), and (a)(3) of this 
section.
    (1) For each transfer point for which flow is measured using a mass 
flow meter, you must calculate the total annual mass of CO2 
in a CO2 stream transferred onsite from offsite sources in 
metric tons by multiplying the mass flow by the CO2 
concentration in the flow, according to Equation RR-1 of this section. 
You must collect these data quarterly. Mass flow and concentration data 
measurements must be made in accordance with Sec.  98.444.
[GRAPHIC] [TIFF OMITTED] TP12AP10.025

Where:

CO2,v = Annual CO2 mass transferred onsite 
from offsite sources (metric tons) through transfer point v.
Qp,v = Quarterly mass flow rate measurement for transfer 
point v in quarter p (metric tons per quarter).
CCO2,p,v = Quarterly CO2 concentration 
measurement in flow for transfer point v in quarter p (wt. 
%CO2/100).
p = quarter.
v = transfer point.

    (2) For each transfer point for which flow is measured using a 
volumetric flow meter, you must calculate the total annual mass of 
CO2 in a CO2 stream transferred onsite from 
offsite sources in metric tons by multiplying the volumetric flow at 
standard conditions by the CO2 concentration in the flow and 
the density of CO2 at standard conditions, according to 
Equation RR-2 of this section. You must collect these data quarterly. 
Volumetric flow and concentration data measurements must be made in 
accordance with Sec.  98.444.
[GRAPHIC] [TIFF OMITTED] TP12AP10.026

Where:

    CO2,v = Annual CO2 mass transferred onsite 
from offsite sources (metric tons) through transfer point v.
    Qp,v = Quarterly volumetric flow rate measurement for 
transfer point v in quarter p at standard conditions (standard cubic 
meters per quarter).
    Dp,v = Density of CO2 at standard 
conditions (metric tons per standard cubic meter): 0.0018704.
    CCO2,p,v = Quarterly CO2 concentration 
measurement in flow for transfer point v in quarter p (wt. 
%CO2/100).
    p = quarter.
    v = transfer point.

    (3) To aggregate transfer data at the facility level, you must sum 
the mass of all CO2 transferred onsite from offsite sources 
through all facility transfer points in accordance with the procedure 
specified in Equation RR-3 of this section.
[GRAPHIC] [TIFF OMITTED] TP12AP10.027

Where:

CO2T = Total annual CO2 mass transferred 
onsite from offsite sources (metric tons) through all transfer 
points at the facility.
CO2,v = Annual CO2 mass transferred (metric 
tons) through transfer point v.
v = transfer point.

    (b) A facility must report annually the mass of CO2 
injected in accordance with the procedures specified in paragraphs 
(b)(1) through (b)(3) of this section.
    (1) For each point at which the flow of an injected CO2 
stream is measured using a mass flow meter, you must calculate annually 
the total mass of CO2 in the CO2 stream injected 
in metric

[[Page 18602]]

tons by multiplying the mass flow by the CO2 concentration 
in the flow, according to Equation RR-4 of this section. You must 
collect these data quarterly. Mass flow and concentration data 
measurements must be made in accordance with Sec.  98.444.
[GRAPHIC] [TIFF OMITTED] TP12AP10.028

Where:

CO2,u = Annual CO2 mass injected (metric tons) 
as measured by flow meter u.
Qp,u = Quarterly mass flow rate measurement for flow 
meter u in quarter p (metric tons per quarter).
CCO2,p,u = Quarterly CO2 concentration 
measurement in flow in quarter p (wt. %CO2/100).
p = quarter.
u = flow meter.

    (2) For each point at which the flow of an injected CO2 
stream is measured using a volumetric flow meter, you must calculate 
annually the total mass of CO2 in the CO2 stream 
injected in metric tons by multiplying the volumetric flow at standard 
conditions by the CO2 concentration in the flow and the 
density of CO2 at standard conditions, according to Equation 
RR-5 of this section. You must collect these data quarterly. Volumetric 
flow and concentration data measurements must be made in accordance 
with Sec.  98.444.
[GRAPHIC] [TIFF OMITTED] TP12AP10.029

Where:

CO2,u = Annual CO2 mass injected (metric tons) 
as measured by flow meter u.
Qp,u = Quarterly volumetric flow rate measurement for 
flow meter u in quarter p at standard conditions (standard cubic 
meters per quarter).
Dp,u = Density of CO2 at standard conditions 
(metric tons per standard cubic meter): 0.0018704.
CCO2,p,u = CO2 concentration measurement in 
flow for transfer point u in quarter p (wt. %CO2/100).
p = quarter.
u = flow meter.

    (3) To aggregate injection data at the facility level, you must sum 
the mass of all CO2 injected through all injection wells at 
the facility in accordance with the procedure specified in Equation RR-
6 of this section.
[GRAPHIC] [TIFF OMITTED] TP12AP10.030

Where:

CO2I = Total annual CO2 mass injected (metric 
tons) through all injection wells.
CO2,u = Annual CO2 mass injected (metric tons) 
as measured by flow meter u.
u = flow meter.
    (c) All GS facilities must also report the mass of CO2 
emitted as fugitive or vented emissions from surface equipment (if this 
information is not required to be reported under subpart W of this 
part), the mass of CO2 produced (if applicable), the mass of 
CO2 emitted from subsurface leakage, and the mass of 
CO2 geologically sequestered in accordance with the 
procedures as specified in paragraphs (c)(1) through (c)(4) of this 
section.
    (1) If you do not report CO2 emitted as fugitive or 
vented emissions from surface equipment at your facility in the 
reporting year under subpart W of this part, you must report them under 
subpart RR of this part in accordance with the procedures specified in 
subpart W of this part for each type of surface equipment. If you 
report these emissions under subpart W of this part, you do not need to 
report these emissions under subpart RR of this part.
    (2) You must calculate the annual mass of CO2 produced 
from oil or gas production wells (if applicable) at the facility for 
each separator that sends a stream of gas into a recycle or end use 
system in accordance with the procedures specified in paragraphs 
(c)(2)(i) through (c)(2)(iii) of this section.
    (i) For each gas-liquid separator for which flow is measured using 
a mass flow meter, you must calculate annually the total mass of 
CO2 produced from an oil or gas stream in metric tons by 
multiplying the mass flow by the CO2 concentration in the 
flow, according to Equation RR-7 of this section. You must collect 
these data quarterly. Mass flow and concentration data measurements 
must be made in accordance with Sec.  98.444.
[GRAPHIC] [TIFF OMITTED] TP12AP10.031

Where:

CO2,w = Annual CO2 mass produced (metric tons) 
through separator w.
Qp,w = Quarterly mass flow rate measurement for separator 
w in quarter p (metric tons per quarter).
CCO2,p,w = Quarterly CO2 concentration 
measurement in flow for separator w in quarter p (wt. % 
CO2/100).
p = quarter.
w = separator.

    (ii) For each gas-liquid separator for which flow is measured using 
a volumetric flow meter, you must calculate annually the total mass of 
CO2 produced from an oil or gas stream in metric tons by 
multiplying the volumetric flow at standard conditions by the 
CO2 concentration in the flow and the density of 
CO2 at standard conditions, according to Equation RR-8 of 
this section. You must collect these data quarterly. Volumetric flow 
and concentration data measurements must be made in accordance with 
Sec.  98.444.

[[Page 18603]]

[GRAPHIC] [TIFF OMITTED] TP12AP10.032

Where:

CO2,w = Annual CO2 mass produced (metric tons) 
through separator w.
Qp,w = Volumetric flow rate measurement for separator w 
in quarter p at standard conditions (standard cubic meters per 
quarter).
Dp,w = Density of CO2 at standard conditions 
(metric tons per standard cubic meter): 0.0018704.
CCO2,p,w = CO2 concentration measurement in 
flow for separator w in quarter p (wt. % CO2/100).
p = quarter.
w = separator.

    (iii) To aggregate production data at the facility level, you must 
sum the mass of all of the CO2 separated at each gas-liquid 
separator at the facility in accordance with the procedure specified in 
Equation RR-9 of this section. You must assume that the total 
CO2 measured at the separator(s) represents (100-X)% of the 
total CO2 produced. In order to account for the X% of 
CO2 produced that is estimated to remain with the produced 
oil and gas, you must multiply the quarterly mass of CO2 
measured at the separator(s) by (100+X)%. The value of X must be 
estimated using a methodology approved by EPA per your MRV plan.
[GRAPHIC] [TIFF OMITTED] TP12AP10.033

Where:

CO2P = Total annual CO2 mass produced (metric 
tons) through all separators in the reporting year.
CO2,w = Annual CO2 mass produced (metric tons) 
through separator w in the reporting year.
X = Percent of CO2 that is estimated to remain with the 
produced oil and gas.
w = separator.

    (3) You must report the annual mass of CO2 that is 
emitted from each leakage pathway identified in your MRV plan. You must 
calculate the total annual mass of CO2 emitted from all 
leakage pathways at the facility in accordance with the procedure 
specified in Equation RR-10 of this section.
[GRAPHIC] [TIFF OMITTED] TP12AP10.034

Where:

CO2E = Total annual CO2 mass emitted from the 
subsurface geologic formation (metric tons) at the facility in the 
reporting year.
CO2,x = Annual CO2 mass emitted (metric tons) 
at leakage pathway x in the reporting year.
x = leakage pathway.

    (4) You must report the annual mass of CO2 that is 
sequestered in the subsurface geologic formation in the reporting year 
in accordance with the procedures specified in paragraphs (c)(4)(i) and 
(c)(4)(ii) of this section.
    (i) GS facilities that are conducting enhanced recovery operations 
and that are actively producing oil or natural gas must calculate the 
annual mass of CO2 that is sequestered in the underground 
subsurface formation in the reporting year in accordance with the 
procedure specified in Equation RR-11 of this section.
[GRAPHIC] [TIFF OMITTED] TP12AP10.035

Where:

CO2 = Total annual CO2 mass sequestered in the 
subsurface geologic formation (metric tons) at the facility in the 
reporting year.
CO2I = Total annual CO2 mass injected (metric 
tons) at the facility in the reporting year.
CO2P = Total annual CO2 mass produced (metric 
tons) at the facility in the reporting year.
CO2E = Total annual CO2 mass emitted (metric 
tons) from the subsurface geologic formation in the reporting year.
CO2FI = Total annual CO2 mass emitted (metric 
tons) as fugitive or vented emissions from equipment located on the 
surface between the flow meter used to measure injection quantity 
and the injection wellhead.
CO2FP = Total annual CO2 mass emitted (metric 
tons) as fugitive or vented emissions from equipment located on the 
surface between the production wellhead and of the flow meter used 
to measure production quantity.

    (ii) GS facilities that are not actively producing oil or natural 
gas must calculate the annual mass of CO2 that is 
sequestered in the subsurface geologic formation in the reporting year 
in accordance with the procedures specified in Equation RR-12 of this 
section.
[GRAPHIC] [TIFF OMITTED] TP12AP10.036

Where:

CO2 = Total annual CO2 mass sequestered in the 
subsurface geologic formation (metric tons) at the facility in the 
reporting year.
CO2I = Total annual CO2 mass injected (metric 
tons) at the facility in the reporting year.
CO2E = Total annual CO2 mass emitted (metric 
tons) from the subsurface geologic formation in the reporting year.
CO2FI = Total annual CO2 mass emitted (metric 
tons) as fugitive or vented emissions from equipment located on the 
surface between the flow meter used to measure injection quantity 
and the injection wellhead.


Sec.  98.444  Monitoring and QA/QC requirements.

    (a) All reporters must adhere to the requirements and procedures in 
paragraph (a) in this section if there has been no EPA direction or 
order specifying a preferred method of measurement.

[[Page 18604]]

    (1) You must determine the quantity transferred by following the 
most appropriate of the following procedures:
    (i) A reporter can measure quantity at the custody transfer meter 
installed at the facility boundary prior to any subsequent processing 
operations at the facility.
    (ii) If you took ownership of the CO2 in a commercial 
transaction, you can use the quantity data from the sales contract if 
it is a one-time transaction or from invoices or manifests if it is an 
ongoing commercial transaction with discrete shipments.
    (2) The point of measurement for the quantity injected is specified 
in paragraphs (a)(2)(i) and (a)(2)(ii) of this section.
    (i) For facilities regulated by the Underground Injection Control 
program, the point of measurement is the flow meter installed at the 
facility you already use to comply with the flow monitoring and 
reporting provisions of your Underground Injection Control permit.
    (ii) For facilities not regulated by the Underground Injection 
Control program because they are outside of Safe Drinking Water Act 
jurisdiction, the point of measurement is the flow meter installed at 
the facility you already use to comply with the flow monitoring and 
reporting provisions of your relevant permit. If no such requirement 
exists, the point of measurement is the flow meter installed closest to 
the point of injection at your facility.
    (3) You must determine the quantity injected by using a flow meter 
or meters.
    (4) You must operate and calibrate all flow meters used to measure 
quantities reported in Sec.  98.443 according to the following 
procedure:
    (i) You must use an appropriate standard method published by a 
consensus-based standards organization if such a method exists. 
Consensus-based standards organizations include, but are not limited 
to, the following: ASTM International, the American National Standards 
Institute (ANSI), the American Gas Association (AGA), the American 
Society of Mechanical Engineers (ASME), the American Petroleum 
Institute (API), and the North American Energy Standards Board (NAESB).
    (ii) Where no appropriate standard method developed by a consensus-
based standards organization exists, you must follow industry standard 
practices.
    (iii) You must ensure that any flow meter calibrations performed 
are NIST traceable.
    (5) You must determine concentration of the transferred 
CO2 stream by following the most appropriate of the 
following procedures:
    (i) A reporter can sample the CO2 stream at the point of 
transfer and measure its concentration.
    (ii) If you took ownership of the CO2 in a commercial 
transaction for which the sales contract was contingent on 
CO2 concentration, and if the supplier of the CO2 
sampled the CO2 stream and measured its concentration per 
the sales contract terms, you can use the CO2 concentration 
data from the sales contract.
    (6) You must determine the CO2 concentration of the 
injected CO2 stream by measuring immediately downstream of 
the flow meter as specified in paragraph (a)(2)(i) or (a)(2)(ii) of 
this section.
    (7) If you measure the concentration of any CO2 quantity 
for reporting, you must use methods that conform to applicable chemical 
analytical standards. Acceptable methods include U.S. Food and Drug 
Administration food-grade specifications for CO2 (see 21 CFR 
184.1240) and ASTM standard E1747-95 (Reapproved 2005) Standard Guide 
for Purity of Carbon Dioxide Used in Supercritical Fluid Applications 
(incorporated by reference, see Sec.  98.7).
    (8) You must determine the transferred CO2 concentration 
and flow quarterly.
    (9) You must sample the injected CO2 concentration and 
calculate the flow quarterly.
    (10) You must use the same calculation methodology throughout a 
reporting period unless you provide a written explanation of why a 
change in methodology was required.
    (11) If you measure the flow of the CO2 transferred or 
injected with a volumetric flow meter, you shall convert all measured 
volumes of carbon dioxide to the following standard industry 
temperature and pressure conditions for use in equations RR-2 and RR-5: 
Standard cubic meters at a temperature of 60 degrees Fahrenheit and at 
an absolute pressure of 1 atmosphere.
    (b) GS facilities must additionally submit an MRV plan to EPA, 
receive approval from EPA, and adhere to the requirements and 
procedures in paragraph (b) of this section.
    (1) You must adhere to paragraphs (a)(1) through (a)(11) of this 
section.
    (2) For reporters who are not required to report the quantity of 
CO2 emitted as fugitive or vented emissions from surface 
equipment at the injection site under subpart W of this part, and are 
thereby required to report fugitive and vented emissions from surface 
equipment under this subpart, monitoring and QA/QC requirements for 
these data should be followed in accordance with procedures specified 
in subpart W of this part.
    (3) The point of measurement for the quantity of CO2 
produced from oil or natural gas production wells at the GS facility is 
a flow meter directly downstream of each separator that sends a stream 
of gas into a recycle or end use system.
    (4) The point of measurement for the concentration of the stream of 
CO2 produced is directly downstream of each separator that 
sends a stream of gas into a recycle or end use system.
    (5) You must sample the produced CO2 concentration and 
flow quarterly.
    (6) A reporter must follow the procedures outlined in the most 
recent MRV plan submitted to and approved by EPA to determine the 
quantity of CO2 emitted from the subsurface geologic 
formation and the percent of CO2 that is estimated to remain 
with the produced oil and natural gas.
    (c) For 2011, a facility that is subject to this rule only because 
of a CO2 injection well(s) that does not meet the definition 
of GS facility in Sec.  98.440(c) may follow the provisions of Sec.  
98.3(d)(1) through (3) for best available monitoring methods rather 
than follow the monitoring requirements of this section. For purposes 
of this subpart, any reference to the year 2010 in Sec.  98.3(d)(1) 
through (3) shall mean 2011.
    (d) All flow meters must be operated continuously.
    (e) If you measure the flow of the CO2 produced with a 
volumetric flow meter, you shall convert all measured volumes of carbon 
dioxide to the following standard industry temperature and pressure 
conditions for use in equation RR-8: Standard cubic meters at a 
temperature of 60 degrees Fahrenheit and at an absolute pressure of 1 
atmosphere.


Sec.  98.445  Procedures for estimating missing data.

    (a) A complete record of all measured parameters used in the GHG 
quantities calculations is required. Whenever the quality assurance 
procedures for all facilities covered under this subpart cannot be 
followed to measure flow and concentration, the most appropriate of the 
following missing data procedures must be followed if EPA has not 
specified a preferred procedure:
    (1) A quarterly quantity of CO2 injected that is missing 
must be estimated using the quantity of CO2 injected from 
the nearest previous period of time at a similar injection pressure.

[[Page 18605]]

    (2) A quarterly quantity of new CO2 transferred onto the 
facility from offsite that is missing must be estimated using the 
quantity of new CO2 flow based on supplier data or supplier-
operated flow meters.
    (3) A quarterly concentration value that is missing must be 
estimated using a concentration value from the nearest previous time 
period.
    (b) A complete record of all measured parameters used in the GHG 
quantities calculations is required. Whenever the quality assurance 
procedures for facilities conducting GS cannot be followed, the most 
appropriate of the following missing data procedures must be followed:
    (1) For any values associated with fugitive or vented 
CO2 emissions from surface equipment at the facility that 
are reported in this supbart, missing data estimation procedures should 
be followed in accordance with those specified in subpart W of this 
part.
    (2) The annual quantity of CO2 produced from the 
subsurface geologic formation that is missing must be estimated 
according to the following:
    (i) If an applicable procedure was included in the reporter's MRV 
plan submitted to EPA, that procedure must be applied.
    (ii) If the procedure included in the reporter's MRV plan is not 
applicable, or if the reporter did not include a procedure in the MRV 
plan, the reporter must estimate annual quantity of CO2 
produced by subtracting the annual quantity of CO2 
transferred onsite from offsite from the annual quantity of 
CO2 injected.
    (3) The annual quantity of CO2 emitted from the 
subsurface geologic formation must be estimated following the procedure 
included in the reporter's MRV plan submitted to EPA.
    (4) All other missing data procedures as outlined in your approved 
MRV plan must be followed.


Sec.  98.446  Data reporting requirements.

    In addition to the information required by Sec.  98.3(c), report 
the information listed in this section. Facilities that are subject to 
this rule only because of CO2 injection wells and that do 
not meet the definition of GS facility in Sec.  98.440(c) do not report 
the information in Sec.  98.3(c)(4).
    (a) For each transfer point flow meter (mass or volumetric), 
report:
    (1) CO2 quantity transferred onsite (metric tons or 
standard cubic meters, as appropriate) in each quarter.
    (2) CO2 concentration in flow (volume or wt. % 
CO2/100) in each quarter.
    (3) If a volumetric flow meter is used, volumetric flow rate at 
standard conditions (standard cubic meters) in each quarter.
    (4) If a mass flow meter is used, mass flow rate (metric tons) in 
each quarter.
    (5) The standard used to calculate each value in paragraphs (a)(1) 
through (a)(4) of this section.
    (6) The number of times in the reporting year for which substitute 
data procedures were used to calculate values reported in paragraphs 
(a)(1) through (a)(4) of this section.
    (b) For each injection flow meter (mass or volumetric), report:
    (1) CO2 quantity injected (metric tons or standard cubic 
meters) in each quarter.
    (2) CO2 concentration in flow (volume or wt. % 
CO2/100) in each quarter.
    (3) If a volumetric flow meter is used, volumetric flow rate at 
standard conditions (standard cubic meters) in each quarter.
    (4) If a mass flow meter is used, mass flow rate (metric tons) in 
each quarter.
    (5) The standard used to calculate each value in paragraphs (b)(1) 
through (b)(4) of this section.
    (6) The number of times in the reporting year for which substitute 
data procedures were used to calculate values reported in paragraphs 
(b)(1) through (b)(4) of this section.
    (c) The source of the supplied CO2, if known, according 
to the following categories:
    (1) CO2 production wells.
    (2) Electric generating unit.
    (3) Ethanol plant.
    (4) Pulp and paper mill.
    (5) Natural gas processing.
    (6) Other anthropogenic source.
    (7) Unknown.
    (d) The total CO2 received onsite (metric tons) in the 
reporting year as calculated in Equation RR-3.
    (e) The total CO2 injected (metric tons) in the 
reporting year as calculated in Equation RR-6.
    (f) GS facilities must also report the following information:
    (1) If you do not report under subpart W of this part, report the 
annual fugitive and vented CO2 emissions from surface 
equipment (metric tons) located in the GS facility under this subpart.
    (2) Annual CO2 mass emitted (metric tons) as fugitive or 
vented emissions from equipment located on the surface between the flow 
meter used to measure injection quantity and the injection wellhead.
    (3) Annual CO2 mass emitted (metric tons) as fugitive or 
vented emissions from equipment located on the surface between the 
production wellhead and of the flow meter used to measure production 
quantity.
    (4) For each separator flow meter (mass or volumetric), report:
    (i) CO2 quantity produced (metric tons or standard cubic 
meters) in each quarter.
    (ii) CO2 concentration in flow (volume or wt. % 
CO2/100) in each quarter.
    (5) For each separator volumetric flow meter, volumetric flow rate 
at standard conditions (standard cubic meters) in each quarter.
    (6) For each separator mass flow meter, mass flow rate (metric 
tons) in each quarter.
    (7) The standard used to calculate each value in paragraphs (f)(4) 
through (f)(6) of this section.
    (8) The number of times in the reporting year for which substitute 
data procedures were used to calculate values reported in paragraphs 
(f)(4) through (f)(6) of this section.
    (9) The value for X (%) used in Equation RR-9 and as determined in 
your MRV plan.
    (10) Annual CO2 produced in the reporting year as 
calculated in Equation RR-9.
    (11) For each leakage pathway, report the CO2 (metric 
tons) emitted through that pathway in the reporting year.
    (12) Annual CO2 mass emitted (metric tons) from the 
subsurface geologic formation at the facility in the reporting year as 
calculated by Equation RR-10.
    (13) Annual CO2 (metric tons) sequestered in the 
subsurface geologic formation in the reporting year as calculated by 
Equation RR-11 or RR-12.
    (14) Cumulative mass of CO2 reported as sequestered in 
the subsurface geologic formation in all years since you began 
reporting.
    (15) Date that the most recent MRV plan was approved and the MRV 
plan approval number that was issued by EPA.
    (16) Whether any of the MRV plan resubmissions scenarios were 
triggered in the reporting year such that you must submit a new MRV 
plan in the following year.
    (17) If the well is permitted by an Underground Injection Control 
permitting authority, for each injection well, report:
    (i) The well ID number used for the Underground Injection Control 
permit.
    (ii) The Underground Injection Control permit class.
    (18) Any other reporting requirement that is specified in your MRV 
plan.


Sec.  98.447  Records that must be retained.

    In addition to the records required by Sec.  98.3(g), you must 
retain the records specified in paragraphs (a) through (c) of this 
section, as applicable.
    (a) You must retain quarterly records of injected CO2 
and CO2 transferred onto the facility from offsite sources,

[[Page 18606]]

including mass flow or volumetric flow at standard conditions and 
operating conditions, operating temperature and pressure, and 
concentration of these streams.
    (b) GS facilities must retain:
    (1) Quarterly records of produced CO2, if applicable, 
including mass flow or volumetric flow at standard conditions and 
operating conditions, operating temperature and pressure, and 
concentration of these streams.
    (2) Annual records of the emitted CO2 from subsurface 
geologic formation leakage pathways.
    (3) Any other records as outlined for retention in your MRV plan.


Sec.  98.448  Geologic Sequestration Monitoring, Reporting, and 
Verification (MRV) Plan.

    (a) A GS facility as defined in Sec.  98.440(c) of this subpart 
must follow the procedures outlined in this section to develop a 
monitoring, reporting, and verification (MRV) plan, submit it to EPA, 
receive approval from EPA on the plan, implement the plan, and submit 
annual report addenda.
    (1) You must develop an MRV plan that contains the following 
components.
    (i) An assessment of the risk of leakage of CO2 to the 
surface.
    (ii) A strategy for detecting and quantifying any CO2 
leakage to the surface.
    (iii) A strategy for establishing pre-injection environmental 
baselines.
    (iv) Summary of considerations made to calculate site-specific 
variables for the mass balance equation.
    (2) A facility that injects CO2 to enhance the recovery 
of oil or natural gas or a facility that is not required to report as a 
GS facility can voluntarily submit the MRV plan to EPA at any time.
    (3) A GS facility that does not inject CO2 to enhance 
the recovery of oil or natural gas must submit the MRV plan on the 
following schedule.
    (i) A GS facility must submit the MRV plan to EPA (A) within six 
months from the time the facility's Underground Injection Control 
permitting authority (or relevant permitting authority in the case of a 
facility that is not under the jurisdiction of the Safe Drinking Water 
Act) confirms the area of review or (B) by December 31 of the year that 
that the Underground Injection Control permitting authority (or 
relevant permitting authority in the case of a facility that is not 
under the jurisdiction of the Safe Drinking Water Act) confirms the 
area of review, whichever date is later. A facility will be allowed to 
request one extension of up to an additional six months.
    (ii) If the GS facility holds an Underground Injection Control 
permit (or relevant permit in the case of a facility that is not under 
the jurisdiction of the Safe Drinking Water Act) as of the date of 
publication of this subpart or if the Underground Injection Control 
permitting authority (or relevant permitting authority in the case of a 
facility that is not under the jurisdiction of the Safe Drinking Water 
Act) has confirmed the area of review as of the date of publication of 
this subpart, such facility must submit the MRV plan to EPA within six 
months of the date of publication of this subpart. A facility will be 
allowed to request one extension of up to an additional six months.
    (4) If you are using an Underground Injection Control Class VI 
permit to demonstrate that MRV plan requirements have been satisfied 
and the Underground Injection Control Class VI permit has not been 
approved, you must submit the identification number associated with the 
Underground Injection Control Class VI permit application and notify 
EPA when the Underground Injection Control Class VI permit has been 
approved.
    (5) Upon MRV plan submission, the following approval process will 
apply.
    (i) On a case-by-case basis, EPA will determine if the submitted 
MRV plan is complete, and evaluate the MRV plan to ensure that the 
facility has an appropriate strategy in place to effectively quantify 
geologically sequestered CO2.
    (ii) You must implement the EPA-approved MRV plan once the plan is 
final, regardless of the point in the reporting year.
    (6) If adjustments to the MRV plan are made due to new information 
or altered site conditions or if a leak is detected in a calendar year, 
you must submit an addendum at the same time as the next annual report 
(March 31 of the subsequent calendar year) that includes the following 
components.
    (i) A description of the leak including all assumptions, 
methodology, and technologies involved in leakage detection and 
quantification, if a leak was detected.
    (ii) A description of how the monitoring strategy was adjusted, if 
adjustments were made.
    (7) The MRV plan must be revised and resubmitted to EPA by March 31 
of the calendar year following any of the following events.
    (i) The reporter is out of compliance with its Underground 
Injection Control permit (or relevant permit in the case of a facility 
that is not under the jurisdiction of the Safe Drinking Water Act).
    (ii) An EPA audit conducted under the verification procedures of 
this part determines it to be necessary.
    (8) An MRV plan may be resubmitted in any reporting year on a 
reporter's own volition.
    (9) Each MRV plan and annual report addendum must be submitted 
electronically in a format specified by the Administrator.
    (b) [Reserved]


Sec.  98.449  Definitions.

    All terms used in this subpart have the same meaning given in the 
Clean Air Act and subpart A of this part.
    Leakage means the movement of CO2 from the injection 
zone to the surface, including to the atmosphere, indoor air, oceans or 
surface water.
    Research and development means, for the purposes of geologic 
sequestration facility requirements in this subpart, those projects 
receiving Federal funding to research practices and monitoring 
techniques that will enable safe and effective long-term containment of 
a gaseous, liquid, or supercritical CO2 stream in subsurface 
geologic formations that are neither demonstration nor commercial 
projects.
    Separator means a vessel in which streams of multiple phases are 
gravity separated into individual streams of single phase.

[FR Doc. 2010-6766 Filed 4-9-10; 8:45 am]
BILLING CODE 6560-50-P