Carbon Capture And Sequestration Projects Research Articles

Uncertainty Analysis of the Storage Efficiency Factor for CO2 Saline Resource Estimation

Carbon capture and sequestration (CCS) is a promising technology for reducing CO2 emissions to the atmosphere. It is critical to estimate the CO2 storage resource before deploying the CCS projects. The CO2 storage resource is limited by both the formation pore volume available to store CO2 and the maximum allowable pressure buildup for safe injection. In this study, we present a workflow for estimating the volume- and pressure-limited storage efficiency factor and quantifying the uncertainty in the estimates. Thirteen independent uncertain physical parameters characterizing the storage formation are considered in the Monte Carlo uncertainty analysis. The uncertain inputs contributing most to the overall uncertainty in the storage efficiency factor are identified. The estimation and uncertainty quantification workflow is demonstrated using a publicly available dataset developed for a prospective CO2 storage site. The statistical distributions of the storage efficiency factor for the primary storage formation and the secondary storage formation located in deeper depth are derived using the proposed workflow. The effective-to-total porosity contributes most to the overall uncertainty in the estimated storage efficiency factor at the study site, followed by the maximum allowable pressure buildup, the net-to-gross thickness ratio, the irreducible water saturation, and the permeability. While the significant uncertain input variables identified are tailored to the characteristics of the study site, the statistical methodology proposed can be generalized and applied to other storage sites. The influential uncertain inputs identified from the workflow can provide guidance on future data collection needs for uncertainty reduction, improving the confidence in the CO2 saline storage resource estimates.

Time-Lapse Pulsed-Neutron Logs for Carbon Capture and Sequestration: Practical Learnings and Key Insights

Pulsed-neutron logs are a staple of time-lapse monitoring programs for saline aquifer carbon capture and sequestration (CCS) projects and are unsurprisingly the most frequently run wireline logs in both injection and monitoring wells. While the emphasis imposed by government regulators and the focus of operators to date has been on the verification of CO2 containment, it is envisioned that a savvy interpretation of the multiple independent measurements should be able to unlock much greater value for the project than merely detecting the location of stored CO2. Recently introduced capabilities for novel measurements and improved environmental compensation should further increase the repeatability, interpretability, and value of these logs. We reviewed more than 30 time-lapse runs of pulsed-neutron logs acquired over a period of 15 years on three mature CCS projects using both previous- and new-generation pulsed-neutron tools, including measurements of formation sigma, hydrogen index, and fast neutron cross section. Special attention in processing is required when changes occur to the wellbore environment between runs, although this is mitigated by the improved environmental compensation scheme of the newer tool. We performed both standalone estimates of CO2 saturation from single-physics time-lapse measurements and simultaneous interpretation of multiple independent time-lapse measurements and studied the results side-by-side with openhole log interpretation, core analysis, and well test results from the evaluation phase. The apparent changes in saturation were framed within the context of the injection history and important events in the life of the wells. A first finding is that differences in apparent CO2 saturation between the various independent measurement physics of the pulsed-neutron tool are often reconcilable and may carry additional information about the state of the well or reservoir. With respect to verification of containment, depending on the well configuration, it may be possible to differentiate between CO2 in the formation and CO2 in the annulus. The interpreted CO2 saturation itself can have different significance depending on the timing of acquisition and the type of well. Measured at the right time, it is a direct in-situ measurement of formation CO2 storage efficiency. In other cases, the interpretation reveals formation dryout in the near-wellbore region of injection wells, a condition that may presage loss of injectivity. We now understand that it is important for operators to plan the timing and frequency of pulsed-neutron runs according to what they want to measure and not based solely on regulatory obligations. In a CCS project, time-lapse pulsed-neutron logs should be thought of as much more than simple indicators of the presence and migration of CO2. They give important information about migration pathways. They can also help to quantify essential uncertainties on reservoir performance that are difficult to ascertain during evaluation. For example, storage efficiency is difficult to quantify with openhole logs since the formation is initially at zero CO2 saturation. Yet it is one of the keys to determining the ultimate storage capacity of any reservoir. Time-lapse pulsed-neutron logs provide an abundance of information that, when properly history matched, can greatly improve our models of CCS reservoirs to better navigate both the economic and operational risks associated with these projects.

Integrated Formation Evaluation for Site-Specific Evaluation, Optimization, and Permitting of Carbon Storage Projects

Participation in over 80 carbon capture and sequestration (CCS) projects spanning 25 years has led to the evolution of a recommended well-based appraisal workflow for CO2 sequestration in saline aquifers. Interpretation methods are expressly adapted for CCS applications to resolve key reservoir parameters, constrain field-scale modeling, provide answers required for the permitting process, and de-risk unique CCS evaluation challenges, such as Storage capacity Injectivity Containment. A challenge complicating all of the above is the eventual impact of three-way interaction among rock matrix, brine, and (impure) CO2 streams. Most logging, sampling, and laboratory techniques are adapted from established domains such as enhanced oil recovery, underground gas storage, and unconventional reservoir evaluation, though some CCS-specific innovation is also needed. Storage evaluation begins with established methods for lithology, porosity, permeability, and pressure, while special core analysis (SCAL) determines CO2 storage efficiency and relative permeability. Containment evaluation spans multiple disciplines and methods: the petrophysicist’s task to quantify seal capacity relies heavily on laboratory analysis, while geologists leverage downhole imaging tools to verify caprock structural/tectonic integrity. Geomechanics engineers define safe injection pressure via mechanical earth models (MEMs) built on advanced acoustic logs calibrated by core geomechanics, wellbore failure observations, and in-situ stress tests. The impact of rock-brine-CO2 interactions is studied via custom SCAL experiments and/or pore-scale digital rock simulations that rigorously represent chemical and thermal processes. Wireline formation tester samples provide representative formation brine as feedstock for SCAL. Water samples also enable operators to prove injection within regulatory limits while establishing baselines for future monitoring programs. Examples applied to recent CCS projects in North America are presented. All of the above data need to be integrated into a CCS model predicting the CO2 plume behavior across the area of interest and within multiple horizons.

Numerical simulation of potential site for CO2 sequestration in a depleted oil reservoir in northern Thailand

Due to the effects of an anthropogenic global warming, the concern about the emissions of carbon dioxide (CO2) into the environment has increased in various industries like petroleum industry. Currently, the use of the geological storage techniques, such as carbon capture and sequestration (CCS), is the most promising way to mitigate these emissions. The objective of this study on a numerical simulation is to investigate CO2 onshore geological storage in the depleted oilfields in the North of Thailand. The geological modelling is a critical step in proving the suitability of a geologic formation for a CCS project. The simulations of the pressure build-up, CO2 plume movement and the amount of CO2 stored are the main points of this research. The development of the 3D reservoir model is performed by means of CMG-GEM, and CMG-WINPROP. This study performs how CO2 sequestration is injected with the flow rate of 1000–4000 tons/day into a reservoir with a depth of 2120-2161 m. The result indicates that CO2 moves up to the top formation. Moreover, 0.583 Mt of CO2 can be stored into the reservoir. This presents the preliminary study for the CO2 sequestration in Northern Thailand, which aids in the next phase of CCS projects in Thailand.

Comments: Pore Space Dealmaking Picks Up Momentum

Since my column in the September 2022 JPT about the regulation of ownership and leasing of pore space, dealmaking has picked up steam, especially by Oxy. Many of the announced deals by Oxy and others are in Texas and in the Gulf Coast region. Oxy Low Carbon Ventures (OLCV) signed an agreement in October with Natural Resource Partners LP for the evaluation of a potential CO2 sequestration hub in Texas. OLCV, a subsidiary of Occidental, would gain rights to about 65,000 acres of pore space for its development, with the potential to store a minimum of 500 million metric tons of CO2. The proposed site is in proximity to industrial greenhouse-gas emitters and a prime location for Oxy’s 1PointFive’s plans to build a carbon capture and sequestration (CCS) hub, possibly connected to direct air capture (DAC) facilities. Also, in October, Occidental and 1PointFive signed a lease agreement with King Ranch, a privately held agricultural production and resource management company, to support large-scale DAC projects on 106,000 acres in Kleberg County, Texas, with the potential to remove up to 30 million metric tons of CO2 per year. The pores space is estimated to store up to 3 billion metric tons of CO2. In addition to DAC emissions capture, the King Ranch acreage is located near industrial emitters in the Gulf Coast region, including Corpus Christi, where emissions can be captured, transported, and sequestered in the pore space. Each DAC plant in the site is expected to be capable of removing up to 1 million metric tons of CO2 per year, yielding a total capacity of up to 30 million metric tons per year when all facilities are operational. Carbon Engineering (CE) began front-end planning and engineering for the DAC facilities in Kleberg County in October. The first 1-megatonne facility is intended to be replicated into multimillion-tonne deployments. The design is being adapted from the first large-scale, commercial facility to use CE’s DAC technology, which is already under construction in the Texas Permian Basin and is expected to start up in 2024. Founded in the 1853, the 825,000-acre King Ranch holds an iconic legacy in Texas. Now, 170 years later, it may build upon that legacy with technological advances not foreseen in its earlier years. In another Oxy deal in 2022, this one with Weyerhaeuser Co., more than 30,000 acres of pore space will be evaluated and potentially developed for CCS in Livingston Parish, Louisiana. Weyerhaeuser will continue to manage the aboveground acreage as a working forest. Also in Louisiana, Lapis Energy, a CCS developer and operator based in Dallas, completed the lease of over 14,000 acres of carbon pore space rights with a private landowner 20 miles west of New Orleans. Lapis believes the pore space in the area has the potential to store more than 500 million tonnes of industrial CO2 and has begun technical studies to progress a Class VI permit for the area. Lapis plans to be ready to begin injection by 2025. San Antonio-based Ozona CCS LLC has reached a definitive agreement in January with Texas Pacific Land Corp. to lease approximately 5,173 contiguous acres of land to drill one of the first commercial CO2 sequestration wells in the Permian Basin. The company will initially focus on the Permian Basin and the Texas Gulf Coast for CCS projects. Initial anchor customers will include natural gas processing plants and oil and gas operators in the region. The acreage has an estimated initial injection rate of up to 25,000 B/D and an estimated total storage capacity of at least 40 million metric tons of CO2. The target in-service date is in the third quarter of 2024. Rystad Energy’s Audun Martinsen, head of supply chain research, forecast a rise in low-carbon investments by $60 billion in 2023, 10% higher than 2022. Hydrogen and CCUS are expected to see the most significant annual increase, growing 149% and 136%, respectively. Total hydrogen spending will approach $7.8 billion in 2023, while CCUS investments will total about $7.4 billion. She wrote, “The new and relatively tiny market of suppliers exposed to low-carbon, well-related services is forecast to climb 33% this year, driven by geothermal drilling and CO2 injection. Despite the significant increase, investments in this market will only total about $3.7 billion.”

Technology Focus: Well Testing (February 2023)

The energy transition is in a continuous pursuit of innovative technology applications from all corners of the oil and gas industry. With the exponential growth of carbon capture and sequestration (CCS) projects, similar subsurface appraisal objectives remain. Derisking dynamic reservoir performance and characterizing storage pore space are key enablers for prospective CCS projects. The mention of well testing often takes readers to a visualization of hydrocarbon disposition by a flare. Once a bright and vibrant spectacle of our industry’s exploration updates, the days of flaunting a chairman’s flow or banker’s burn are past. Waning application of well testing during our energy transition is a specious assumption, and it’s the optics that are transforming as the well testing discipline proves its value to long-term carbon storage projects. Injecting CO2 into the subsurface is hardly a new concept; operators have been doing this for decades as part of enhanced oil recovery. However, the application of injecting CO2 is changing in response to operators’ environmental, social, and governance ambitions. While carbon storage concepts exist in many forms, anchoring a storage project requires pore space of adequate quantity and quality in proximity to a fixed source of emissions. Carbon storage projects also must manage additional risks such as sustained injectivity performance, geologic seal integrity, and plume migration, to name a few. Enter well testing. Quantifying injection performance of supercritical fluids is crucial for optimizing wells to meet project needs while minimizing the number of required penetrations through a structural seal. Whether for a saline aquifer or a previously depleted field, pressure transient analysis enhances understanding of the pore space intended for storage and the potential heterogeneities within. Furthermore, integrating well testing with other reservoir-description tools may be used to monitor migration of stored fluids within the reservoir. With corporate and regulatory targets driving the unprecedented pace and scale of CCS opportunities, well testing is quickly reaffirming itself as a powerful tool in characterizing pore space essential to our lower-carbon goals. This month’s papers highlight ongoing developments within the well testing discipline and important reminders about how to properly use dynamic data. The application of these well testing fundamentals to a nascent carbon storage market is still evolving. Recommended additional reading at OnePetro: www.onepetro.org. SPE 208967 Rate-Pseudopressure Deconvolution Enhances Rate-Time Models Production History-Matches and Forecasts of Shale Gas Wells by L.M. Ruiz Maraggi, The University of Texas at Austin, et al. URTeC 3705570 Analysis of Multiple Flow/Buildup Tests Including a 5-year Buildup: Case Study of an Australian Shale Gas Well by Christopher R. Clarkson, University of Calgary, et al. OTC 31691 Challenges and Mitigation Strategies for High-Rate Gas Well Testing in High-Pressure/High-Temperature DST Operation by Jakpakorn Hemaprasertsuk, PTTEP, et al.

The Australian CCS roadmap – a reflection on lessons learned and considerations for future success

With the announcement of the Australian government’s technology roadmap ‘out of COVID’, we are on the cusp of potentially the next wave of carbon, capture and sequestration (CCS) project development. To date, Australia has just one operational large-scale CCS project. Before Australia embarks on a potential new wave of CCS developments, reflection on successes and the lessons learned both domestically and in a global context is required. Xodus has reviewed a range of CCS projects, taking into consideration project type, government policy, investment and country energy mix. From this, Xodus has assessed what is needed to enable deployment of large-scale CCS projects.

What Went Wrong? Learning from Three Decades of Carbon Capture and Sequestration (CCS) Pilot and Demonstration Projects

The delivery of operational clean energy projects at scales, is essential for addressing climate change. Carbon capture and sequestration (CCS) is among the most important clean technology, however, most CCS projects initiated in the past three decades have failed. This study statistically evaluates the reasons for this unfavourable outcome by estimating a hazard model for 263 CCS projects undertaken between 1995 and 2018. The results indicate that larger plant sizes increase the risk of CCS projects being terminated or put on hold; increasing capacity by 1Mt CO2/y increases the risk of failure by nearly 50%. We also examined the impact of technology push and market pull policies and found that existing support mechanisms have not been sufficient in mitigating the risks associated with project upscaling. CCS deployment at the gigaton scale depends on substantially reducing project risk while increasing expectations of financial returns. Gradual upscaling, increased policy support, particularly for demonstrations of the viability of CCS, while also building a market through carbon pricing would help remedy the current imbalance between risk and return. Increasing the expected payoffs for CCS so that hundreds of real projects are brought on-line will require the co-evolution of technology innovation, institutions, investment, and deployment strategy for CCS technology.

A preliminary estimation for CCS storage cost of Korea

Carbon capture and sequestration (CCS) projects can be considered a promising alternative for stabilizing carbon dioxide emissions in the atmosphere. There has been a lot of support from the Korean government to boost CCS projects, so that they may become commercialized. To conduct a CCS project, economic and geological considerations, as well as technical feasibility, are required. An excessively high cost prohibits CCS projects from being commercialized, even with the proper geological condition and technical feasibility. Therefore, it is essential to conduct an appropriate economic estimation analysis alongside the geological investigation and the technique development. The aim of this study is to estimate the storage costs of CCS projects, which are typically composed of capture, transport, and storage. Since cost estimation analyses have rarely been carried out in Korea, we have estimated the construction cost of the CCS storage by adopting assumptions made in the previous studies. To store 2.02 Mt for 20 years, 6.75–9.58 $/tCO2 is the estimated financial requirement.

An Overview of CCS Road Map and Identification of a Suitable CO2 Disposal Site in Eastern Zagros (Fars Area) in Iran

Global warming and is a worldwide concern raised due to emissions of anthropogenic greenhouse gases. Oil & gas producing countries which are the members of the Kyoto Protocol, including Iran, have held a committee to reduce these gases, especially CO2 emissions. One way of reducing emissions is using carbon capture and storage technology in geological formations, known as Carbon Capture and Sequestration (CCS). Having a strategic roadmap to implement the CCS projects in Iran is essential. In addition, there is a close and direct relationship between the number of oil and gas reservoirs and amount of CO2 emissions in Zagros area in Iran. The objective of this paper is to present and discuss the CCS roadmap provided for Oil & Gas operations in Iran with focus on gas-industry related features. In addition, an appropriate geological structure in Zagros region suitable for CCS operation is proposed and discussed. The recognized aquifer at a depth of 1500 meters below the sea level in Fars area in Zagros, which is covered by Nar cap rock, maybe a good choice for CO2 injection. This aquifer is located in Lower-Dalan with appropriate reservoir property that is investigated in this paper. We will present the CCS roadmap in Iran, followed by the key features of CO2 disposal into this formation.

Effects of Simulation Leakage of CCS on Physical-chemical Properties of Soil

Because of the risk of leakage with CCS (Carbon Capture and Sequestration) projects, the near surface ecological impact is considered to be an important area on CCS. In order to research soil impact of CCS, physical-chemical properties of soil were analyzed through the simulation in CO2 artificial climate chamber. The results showed as follows: Soil particle size distribution and the concentrations of heavy metal have no significant impacts with the elevated of CO2 concentration. All ionic concentration except HCO3- descended slightly at low concentration and increased obviously at high concentration with the elevating of the CO2 concentration. HCO3- and pH had no obvious variation with the change of the CO2 concentration. AHN, TN, AP, TP and AK of soil had a slightly increasing with the elevating of CO2 concentration. But AHN/TN, AP/TP had no significant change with the elevating CO2 concentration.

Feasibility of a Perfluorocarbon tracer based network to support Monitoring, Verification, and Accounting of Sequestered CO2

Carbon capture and sequestration (CCS) will act as a bridging technology necessary to facilitate a transition from fossil fuels to a sustainable energy based economy. The Department of Energy (DOE) target leak rate for sequestration reservoirs is 1% of total sequestered CO(2) over the lifetime of the reservoir. This is 0.001% per year for a 1000 year lifetime of a storage reservoir. Effective detection of CO(2) leaks at the surface may require incorporation of a tracer tag into the sequestered CO(2). We applied a simple Gaussian Plume model to predict dispersion of a direct leak into the atmosphere and used the results to examine the requirements for designing a perfluorocarbon (PFT) monitoring network and tracer tagging strategy. Careful consideration must be given to the climate implications of using these compounds. The quantity of PFTs needed for tagging sequestered CO(2) is too large to be practical for routine monitoring. Tagging at a level that will result in 1.5 times background at a sampler 1 km from a leak of 0.01% per year will require 625 kg per year of PFT. This is a leak rate 10 times greater than the 1000 year DOE requirement and will require 19 tons of injected PFT over the 30 year lifetime of a 1000 mega watt coal fired plant. The utility of PFTs or any other tracer will be lost if the background levels are allowed to rise indiscriminately. A better use of PFTs is as a tool in sequestration research. Instead, geological surveys of sequestration sites will be necessary to locate potential direct pathways and develop targeted monitoring strategies. A global agreement on the use of tracers for monitoring CCS projects should be developed.

Economic evaluation of CO 2 pipeline transport in China

Carbon capture and sequestration (CCS) is an important option for CO 2 mitigation and an optimized CO 2 pipeline transport system is necessary for large scale CCS implementation. In the present work, a hydrodynamic model for CO 2 pipeline transport was built up and the hydrodynamic performances of CO 2 pipeline as well as the impacts of multiple factors on pressure drop behavior along the pipeline were studied. Based on the model, an economic model was established to optimize the CO 2 pipeline transport system economically and to evaluate the unit transport cost of CO 2 pipeline in China. The hydrodynamic model results show that pipe diameter, soil temperature, and pipeline elevation change have significant influence on the pressure drop behavior of CO 2 in the pipeline. The design of pipeline system, including pipeline diameter and number of boosters etc., was optimized to achieve a lowest unit CO 2 transport cost. In regarding to the unit cost, when the transport flow rate and distance are between 1–5 MtCO 2/year and 100–500 km, respectively, the unit CO 2 transport cost mainly lies between 0.1–0.6 RMB/(tCO 2 km) and electricity consumption cost of the pipeline inlet compressor was found to take more than 60% of the total cost. The present work provides reference for CO 2 transport pipeline design and for feasibility evaluation of potential CCS projects in China.

Geologic sequestration through EOR: Policy and regulatory considerations for greenhouse gas accounting

Abstract The objective of carbon capture and sequestration (CCS) is to reduce emissions to the atmosphere through the sequestration of carbon dioxide (CO 2 ) in deep geologic formations. Recent studies of life-cycle emissions from CCS projects that sequester CO 2 captured from coal-fired power generation through EOR show that net emissions from this process are positive due to the CO 2 emissions embodied in produced oil. For geologic sequestration through enhanced oil recovery (GS-EOR) to be effective, life cycle GHG emissions from the system must be small and consumption of the energy produced should not result in larger emissions than would otherwise happen in the absence of the GS-EOR project. In the best case, where relatively high emissions intensity oil and electrical generation are being displaced, the emissions reduction potential is greater than the amount of CO 2 purchased by the project; however, where a relatively light crude and carbon free marginal generation is being displaced, the GS-EOR project results in an emissions increase. As a matter of public policy, if reducing emissions of CO 2 is of great importance, encouraging GS-EOR will not be as effective as geologic sequestration in deep saline aquifers, or other means of reducing emissions that do not result in increased production of fossil fuels. Nonetheless, it is likely that GS-EOR projects will happen in the absence of emissions reduction incentives because they bring other benefits. The nature and scope of a GHG reduction program will determine the accounting approach needed to accurately estimate the emissions from GS-EOR, but in general, components that do not fall under an emissions cap will need to be accounted for via life cycle assessment. While further study is needed, it appears that allocating the emissions reduction to an electric power generator would be less complex and more effective that allocating it to the oil or fuels producer.

CO GRANTS FOR CHEMICAL PLANTS

CHEMICAL COMPANIES and other industrial sources of greenhouse gas emissions are eligible for $1.3 billion in grants for large-scale carbon capture and sequestration (CCS) demonstration projects under a Department of Energy program announced on June 8. Industrial sources generate some 19% of U.S. greenhouse gas emissions, but DOE funding support for CCS projects has gone primarily to coal-fired electric power generators. The June 8 announcement, however, is specifically directed to industrial sources, including chemical companies, refineries, cement plants, steel and aluminum producers, manufacturing facilities, and some power plants that use petroleum coke and waste as fuel rather than coal or natural gas. “We are happy to see that DOE is funding industrial CCS projects,” says Timothy Brown, a spokesman with global engineering firm Alstom Power. Alstom has several CCS demonstration projects around the world, but only two are at industrial sites—a Dow Chemical facility in West Virginia and an oil refinery ...

The geography of CCS regulatory development in the U.S.

States will play a vital role in the deployment of carbon capture and sequestration (CCS) in the United States. Many of the decisions and planning required to deploy CCS projects on a national scale will occur at the state and regional levels, including Public Utility Commission decisions on treatment of CCS costs, decisions on land use for building CO2 pipelines and developing geologic sequestration sites. There has been a burst of CCS policy activity in the states over the past few years. As of August 2008, 26 states have some sort of policy in place aimed at furthering CCS. To examine the importance of states’ particular circumstances on CCS policy development, we consider variables related to each state’s geology, electrical power system, economy, and political ideology. We find that distinctly different profiles emerge between states with CCS policies, states with climate policy, states with both, and states with neither. Understanding the state level policy landscape provides a basis for more effective coordination between state, regional, and federal CCS policy, and sheds some light on the compromises that need to be made between geographically diverse states for CCS to be widely deployed. A case study of the Midwestern Governors Association CO2 Management Infrastructure Partnership illustrates the opportunities that regional partnerships offer to facilitate these types of compromises and coordinate policy between states with varying circumstances but a shared interest in regional cooperation to advance commercial scale CCS.

A Multi-Level Approach to Outreach for Geologic Sequestration Projects

Abstract Public perception of carbon capture and sequestration (CCS) projects represents a potential barrier to commercialization. Outreach to stakeholders at the local, regional, and national level is needed to create familiarity with and potential acceptance of CCS projects. This paper highlights the Midwest Geological Sequestration Consortium (MGSC) multi-level outreach approach which interacts with multiple stakeholders. The MGSC approach focuses on external and internal communication. External communication has resulted in building regional public understanding of CCS. Internal communication, through a project Risk Assessment process, has resulted in enhanced team communication and preparation of team members for outreach roles.

Informing policy development for geologic carbon sequestration in California

Abstract In California, there have been numerous policy directives aimed at mitigating greenhouse gas (GHG) emissions. In 2005, Executive Order S-3-05 established three target reduction levels for GHG emissions for the state, most notably a return to 1990 levels by 2020 (codified into law by the Global Warming Solutions Act of 2006) and a reduction to 80 percent below 1990 levels by 2050. In 2006, Senate Bill 1368 mandated a GHG emission performance standard (set at an interim level of 1100 lb- CO2/MWh or 500 kg-CO2/MWh) for new or renewed long-term contracts to purchase electricity from baseload facilities, and Assembly Bill 1925 required a report to the California legislature containing recommendations for accelerating the adoption of cost-effective geologic sequestration strategies for the long-term management of industrial carbon dioxide. Assembly Bill 1925 provided a unique opportunity for technical experts and other stakeholders to inform future policy decisions and regulations for geologic carbon sequestration in California. The author of the bill, the state agencies, and other stakeholders involved in developing the report agreed that a two-stage process would best address the goals of the legislation. A first report was recently released that provides a thorough overview of carbon capture and sequestration (CCS) fundamentals in a California context and recommends areas for additional data acquisition or analyses. A second report, to be issued in 2010, will contain a full set of recommendations based on further studies, stakeholder input, and data and lessons learned from ongoing geologic CCS projects worldwide and particularly from field tests in California conducted by the West Coast Regional Carbon Sequestration Partnership (WESTCARB). This paper presents an overview of the approach and key findings of the first report, including technical readiness, infrastructure needs, regulatory and economic assessments, identification of potential early opportunities for application of CCS technology, and assessment of the greatest barriers to widespread CCS adoption in the state. Many of these findings are generally applicable beyond California or provide analogs useful to other states.

Environmental bonds and the challenge of long-term carbon sequestration

The potential to capture carbon from industrial sources and dispose of it for the long-term, known as carbon capture and sequestration (CCS), is widely recognized as an important option to reduce atmospheric carbon dioxide emissions. Specifically, CCS has the potential to provide emissions cuts sufficient to stabilize greenhouse gas levels, while still allowing for the continued use of fossil fuels. In addition, CCS is both technologically-feasible and commercially viable compared with alternatives with the same emissions profile. Although the concept appears to be solid from a technical perspective, initial public perceptions of the technology are uncertain. Moreover, little attention has been paid to developing an understanding of the social and political institutional infrastructure necessary to implement CCS projects. In this paper we explore a particularly dicey issue—how to ensure adequate long-term monitoring and maintenance of the carbon sequestration sites. Bonding mechanisms have been suggested as a potential mechanism to reduce these problems (where bonding refers to financial instruments used to ensure regulatory or contractual commitments). Such mechanisms have been successfully applied in a number of settings (e.g., to ensure court appearances, completion of construction projects, and payment of taxes). The paper examines the use of bonding to address environmental problems and looks at its possible application to nascent CCS projects. We also present evidence on the use of bonding for other projects involving deep underground injection of materials for the purpose of long-term storage or disposal.