Mandatory Reporting of Greenhouse Gases: Injection and Geologic Sequestration of Carbon Dioxide, 18576-18606 [2010-6766]

Agencies

• ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 75, Number 69 (Monday, April 12, 2010)]
[Proposed Rules]
[Pages 18576-18606]
From the Federal Register Online via the Government Printing 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 https://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: https://www.regulations.gov. Follow the 
online instructions for submitting comments.
    E-mail: GHGReportingRR@epa.gov.
    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 
https://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 https://www.regulations.gov or e-mail. The https://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 https://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 https://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 https://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 ghgmrr@epa.gov 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 https://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: GHGReportingRule@epa.gov.
    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 
https://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: 
https://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: https://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\
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    \9\ See EPA UIC Guidance 83. Available at: https://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.
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    \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: https://www.pi.energy.gov/enhancingGHGregistry.
    \11\ Available at: https://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: https://www.irs.gov/irb/2009-44_IRB/ar11.html.
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    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: https://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.
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    \13\ IPCC, 1996. ``Revised 1996 IPCC Guidelines for National 
Greenhouse Gas Inventories.'' National Greenhouse Gas Inventories 
Programme. Available: https://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: https://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: https://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.
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    \16\ 2006 IPCC Guidelines for National Greenhouse Gas 
Inventories: Volume 2--Energy. Chapter 5 Carbon Dioxide Transport, 
Injection, and Geological Storage. Available at: https://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:
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    \18\ Available at: https://www.imo.org/includes/blastData.asp/doc_id=10531/9%20%20CO2%20Sequestration%20English.pdf.
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     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.
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    \19\ Available at: https://cdm.unfccc.int/about/ccs/.
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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 ap