Skeptical judges question industry assault on EPA’s carbon capture rule

By Jeremy P. Jacobs | 03/26/2015 01:13 PM EDT

Federal judges were skeptical today of an industry challenge to U.S. EPA’s determination that carbon captured from power plant emissions and injected underground qualifies as a "solid waste."

The complicated case before the U.S. Court of Appeals for the District of Columbia Circuit relates to EPA’s effort to promote carbon capture and sequestration, or CCS, as part of its plan to address climate change.

CCS takes carbon dioxide from power plants and injects it into wells half a mile underground.

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The complete process is not currently being used in the United States. To promote it, however, EPA in January issued a rule that exempted the carbon dioxide "streams" — which are composed of the substance in a partly liquid, partly gaseous state — from characterization as a "hazardous waste" under the Resource Conservation and Recovery Act, or RCRA, when injected into that type of well. Such a determination would have subjected the streams to regulatory compliance requirements.

In the process, however, EPA determined that the streams do qualify as "solid waste," which requires them to be certified.

Companies that generate the carbon dioxide streams, represented by the Carbon Sequestration Council and backed by the American Petroleum Institute, challenged the "solid waste" finding.

Their interest, however, is only tangentially related to the rule at issue. Carbon dioxide streams are also used in enhanced oil recovery, where they are injected into wells in order to help them produce more oil.

Those types of wells are characterized differently by EPA, referred to as Class I through Class V wells. The CCS wells at issue in the rule are Class VI.

At least two of the three judges on the D.C. Circuit panel were consequently reluctant to believe the challengers had proved they were injured by the EPA’s rule. If the challengers could not prove injury, it would mean they lacked standing to bring the lawsuit.

Senior Judge Harry Edwards, a Democratic appointee, repeatedly pressed attorney Thomas Llewellyn.

"I don’t see anything with respect to either petitioner that they are using or intending to use Class VI wells," Edwards said.

Chief Judge Merrick Garland appeared to agree, asking Llewellyn, "What’s the injury?"

Llewellyn countered that one party in the case, Southern Co., is currently capturing carbon at its Kemper County energy facility in Mississippi. The company, he said, is considering diverting some of those streams to Class VI wells.

The Department of Justice’s Michele Walter, representing EPA, argued that the challengers are "overreading" the regulation by suggesting it would apply to their operations at other types of wells.

EPA’s rule, she said, is "narrow and circumscribed" and designed to "remove barriers" to using Class VI wells.

She added that she was "trying to understand what their real injury is. … [EPA was] trying to make this simpler for industries."

A decision in Carbon Sequestration Council v. EPA is expected later this year.

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