This comment letter response contains two parts: (1) The original submittal from the commenter. (2) A data base printout of EPA’s response to each point raised by the commenter.

Notes about the response letters:

• The response letters were generated by a data base used to track the content of all public comment submittals and ensure that the Agency responds to each. Each comment letter was assigned a Letter ID that corresponds to the last four digits of the docket number of the original comment (as posted on www.regulations.gov).

• Each response letter includes: comment text; an EPA

‐ assigned comment code; and an individual response. These are described and explained below.

• The data base contains Comment text from the letters submitted by commenters. Many hard copy letters were scanned into electronic format for inclusion in the data base. As a result, there may be some typographical errors attributable to optical character recognition issues. However, all original submittals were reviewed in the process of drafting responses to ensure that the comment content was understood and appropriately addressed.

• The content of each comment letter was divided into topic areas and assigned a unique Comment ID. Additionally, one or more Comment Codes (i.e., unique topic area ID) was assigned to each discrete point raised by a commenter. This information was added to the data base. To inform final rulemaking decisions, all comments and information received on a given topic were reviewed by technical experts in each rule area (e.g., on construction requirements).

• Following decisions on the final rule requirements, Individual responses were drafted by topic area to ensure completeness and consistency of the responses with the final rule and other responses to similar comments. Each discrete point made by a commenter was given a unique response.

• Upon completion of comment responses, all information was entered into the data base. Each letter response is a compilation of each comment and its individual response, compiled in the order of the original comment letter. As a result of this process, there is repetition in the response text. The Agency believes this approach ensures completeness and attention to each comment letter that was submitted.

• All comments in a topic area were reviewed, evaluated, and responded to concurrently. Responses on each topic area are compiled and are also available in the rulemaking docket.1

Federal Requirements Under the Underground Injection Control Program for

Carbon Dioxide Geologic Sequestration Wells Docket No. EPA

- HQ

- OW

- 2008

- 0390 73 Fed. Reg. 43492 (July 25, 2008) Comments of the American Public Power Association (APPA)

D ecember 1 9 , 2008

INTRODUCTION
The American Public Power Association (A PPA) appreciates the opportunity to file comments on such a significant rulemaking. APPA filed preliminary comments with the EPA regarding the issue of geologic sequestration in the context of the experimental injection projects in 2007 which did not fit i nto a Class II UIC program definition. APPA submits these comments on the proposal of the Environmental Protection Agency ("EPA" or "the Agency") to establish the regulatory framework for geologic sequestration (“GS”) of carbon dioxide (“CO 2 ”) under the Un derground Injection Control (“UIC”) Program pursuant to the Safe Drinking Water Act ("SDWA"). 73 Fed. Reg. 43492 (July 25, 2008). Public power is the term used to describe the more than 2,000 municipal and other state and local community

- owned electri c utilities that provide electricity for approximately 4 5 million Americans. These public power systems are among the most diverse of the electric utility sectors, representing utilities in small, medium and large communities in 49 states (all states e xcept Hawaii). Seventy

- five percent of public2

power systems are located in cities with populations of 10,000 or less. Overall, public power accounts for about 16 percent of all kilowatt

- hour sales to consumers. APPA was created in 1940 as a non

- profit, non - partisan organization. Its purpose is to advance the public policy interests of its members and their consumers, and provide

me mber services to ensure adequate, reliable electricity at a reasonable price with the proper protection of the environment. More than 90% of APPA member utilities meet the definition and qualify under the Small Business Regulatory Enforcement and Fairness Act of 1996 (SBREFA). One characteristic of public power municipal electric utilities that makes our perspective unique is that more than 80% of APPA member utilities also manage drinking water utilities with residential, industrial, commercial and industrial customers.
Wh ile APPA’s comments primarily focus on the electric generation issues related to the proposed UIC rule, we cannot divorce the drinking water protection issues from our own responsibilities as a part of approximately 1,000 municipal governments. There are approximately 4 ,000 additional private drinking water companies in the United States.3 Table of Contents
Introduction

– Pg. 1 Executive Summary of APPA’s comments

-- Pg. 7 Background

- - Pg. 1 0 APPA has a very unique perspective and knowledge ba se from which to provide meaningful input on the development of EPA's UIC regulations for CO 2 sequestration because of our 1,400 member utilities (owned and operated by local government

— usually municipalities), over 80% also manage local drinking water for residential consumers as well as commercial and other parties. Area of Review

-- Pg. 2 6 Modeling

-- Pg. 2 6 General Issues Related to Classification and Regulation of CO 2 GS Wells

-- Pg. 2 0 APPA believes the creation of a new category of wells under the UIC Program for long

- term storage of CO 2 is appropriate and agrees with EPA that the Final Rule should create a delegable program and encourage the adoption and im plem entation of that program by States. Grandfa thering Requirements of Class I, II and V UIC Wells

-- Pg. 3 1 APPA believes that the state should be allowed to grandfather construction requirements for existing Class I, II, and V wells seeking a Class VI permit for GS of CO 2 if the state believe s that the Class V experimental well USDW protections are adequate. Sitting of CO 2 GS Wells

-- Pg. 3 2 APPA believes it is counter

- productive at this stage in the development of a CO 2 GS regulatory regime to categorically preclude any potentially feasible injection formations as possible long

- term storage sites with the exception of sole source aquifers. Interaction with RCRA

-- Pg.3 3 APPA believes that RCRA corrective action for the entire power plant would rank with parasitic power loss as possibl y insurmountable obstacles for geologic sequestration.4 Table of Contents Continued

Interaction with CERCLA

-- Pg. 3 7 APPA believes that Congress will need to act to correc t the potential for open

ended CERCLA liability for any contamination resulting from CO 2 GS activities before commercial deployment should be expected. Permit Application and Reporting Requirements

-- Pg. 3 9 APPA believes that electronic reportin g should not be absolute but should instead permit the Director to allow other methods of reporting when he deems such methods more appropriate. In addition, APPA believes that annual reporting will not always be the best way to collect this informa tion over the lifetime of the project.
We ll Plugging and Post

- Injection Site Care

-- Pg. 4 1 APPA believes that the Proposal’s suggested fifty

- year default fixed timeframe for the post

- injection site care period is arbitrary and will serve to disc ourage Owners or Operators of CO 2 GS sites from seeking to develop innovative ways to safely close wells in a shorter time period. While there is no single time period that can apply across the board, APPA suggests that 10 years or until the plume is dete rmined to be stable is sufficient.
Financial Responsibility

-- Pg. 4 2 APPA supports EPA’s suggestion to issue guidance in the future for clarification of the financial responsibility mechanisms available for Owners or Oper ators of CO 2 GS wells, provided that such guidance is issued in accordance with OMB’s Good Guidance Manual and that the final rule accommodate a range of options, including self

- insurance instruments. Public Particip ation

-- Pg. 4 4 APPA agrees that public participation is crucial to the success of any individual CO 2 GS project and of the UIC Program as a whole. The need for better data for GS to work

-- Pg. 4 4 In non

- oil and gas states (or perhaps some mi ning states) there is little known about the subsurface geology. APPA believes that USGS and other agencies can help the EPA and state agency directors in better characterizing these formations.5 Table of Contents Continued

Leaks and response plans

-- Pg. 4 6 APPA believes that the owner/operator must take remedial action as described in the permit’s response plan. Monitoring

-- Pg. 4 6 APPA believes it makes common sense to place monitors close enough to detect the leak before it can negatively affect the USDW. Electric Reliability

-- Pg. 4 7 APPA believes that potential impacts to electric reliability should be considered in promulgating the UIC Class VI permitting program rules. NERC ’s study can be found at: http://www.nerc.com/files/2008

- Climate

- Initiatives

- Report.pdf SBREFA Impacts

– Pg. 4 7 Exec utive Order 12866

– Pg. 4 7 Conclusion

-- Pg. 4 8

Appendix

-- Pg. 4 9

- Australia Parliamentary Library, Research Paper no. 9 2008

– 09, “ The potential for renewable energy to provide baseload power in Australia ”, by Stewart Needham, Science, Technology, Environment and Resources Section. 23 Septembe r 2008.

- L.D. Carter, White Paper, " Carbon Capture and Storage From Coal

- based Power Plants: A White Paper on Technology for the American Public Power Association (APPA) ," May 2007

- L.D. Carter, White Paper, " Retrofitting Carbon Capture Systems on E xisting Coal

- fired Power Plants ," November 2007

- Marianne Horinko “Carbon Capture and Sequestration Legal and Environmental Challenges Ahead,” August 20076 Table of Contents Continued

- “ Will Water Issues/Regulatory Capacity Allow or Prevent Geologic Sequestration for New Power Plants?” J. Gle dhill, J. Rollins, T . Pugh

- Issues Related to Seismic Activity Induced by the Injection of CO 2 in Deep Saline Aquifers , Joel Sminchak and Neeraj Gupta, Battelle Memorial Institute

- Why doesn't Greece like carbon capture? Leigh Phillips September 23, 2008

- GAO study “ Climate Change ” Federal Actions will Great ly Affect the Viability of Carbon Capture and Storage As a key Mitigation Option.

- Statement of Don Broussard , Lafayette, La. Utilities System before the House Subcommittee on Environment and Hazardous Materials On Geologic Carbon Sequestration. July 24 th , 2008

- APPA Comments to NERC on Reliability Impacts of Climate Change Initiatives

. July 16 th , 2008

- Populations Trend Map

- Aquifer Map7

Executive Summary of APPA’s comments
1. APPA believes that a Class VI permitting program is essential to enable geologic sequestration at power plants.
2. APPA represents 1,400 municipal or public power utilities and 80% of those also
manage public or municipal drinking water utilities and provide drinking water to residential, commercial a nd industrial customers. Approximately 50% of the power generated by public power utilities is from coal and APPA believes coal is critical for baseload generation. Although peaking and intermediate generation may be possible with renewables, baselo ad generation requires hydro, nuclear, coal, oil or natural gas to maintain reliability. Wh ile some renewable sources (e.g. biomass) are available for baseload generation, the current power capacity
is small. Further development in the renewables sector is required before any significant level of substitution of coal

- fired power can take place. Research and development into special battery storage, solar thermal, photovoltaic, ocean and geothermal energy indicates promising prospects for reliable and cont inuous power from renewables, but, it will be several decades before expected widespread deployment of renewable baseload generation

. 1
3. APPA wants geologic sequestration of CO 2 to work

. Geologic Sequestration
mi ght enable the p ower utility sector to use coal at future and existing power plants while reducing CO 2 emissions

. However, the technology is not yet fully

1 Australia Parliament ary Library, Research Paper no. 9 2008

– 09, “ The potential for renewable energy to provide baseload power in Australia ”, by Stewart Needham, Science, Technology, Enviro nm ent and Resources Section. 23 September 2008 . A copy is included in the Appendix.8

commercially demonstrated and suitable geology may not be available in all states. This caution does not discourag e us from wanting it to work or for supporting additional demonstration projects at DOE/NETL and in the private sector. Geosequestration opportunities in oil and gas states are probably the most optimal location for early adopters of CCS technology(s). AP PA encourages the use of oil and gas fields for injection of CO 2 from power plants.
4. APPA strongly encourages the EPA to recognize the inextricable lin k between energy and water use. Wa ter demand for power production remains intense, and may grow concurrently with demand growth and population growth. APPA recommends the Desalination and Water Purification Technology Roadmap developed by Sandia National Labs i n 2003 as a summary of the water

- energy issues. 2
5. APPA believes that new power plants designed for geologic sequestration should be planned for sequestration to be conducted for the “ life of the plant ”

— which can be as long as 60 years. However, APPA believ es that if some type of lateral or vertical migration of the CO 2 or other substances (such as brine, metals, drilling muds, cement from well failure) is detected and believed to be potentially harmful to the underground sources of drinking water ( USDW ) , th at the power plant or power plants supplying the CO 2 to the injection site(s) should be given an “ infeasibility exemption 3 ” f or sequestration of its CO 2 . This exemption should enable the power plant to continue to operate without carbon dioxide i njection in that location. Without this “infeasibility” or “back out” clause for geosequestration ,

2 This document can be downloaded at http://www.sandia.gov/water/desal/docs/DesalRdmap04a.pdf 3 For the first generation plants, the “infeasibility exemption” should extend beyond infeasibility of the carbon capture operations of the power plant.9

it is highly unlikely that communities would build power generating facilities with carbon capture and injection systems that could cost at least $2 billion dollars (2008 dollars) or be able to obtain financing if the plant was not expected to operate for the full 50

- 60 years . The financial risks for closure of a power generating plant or multiple plants in a region would simply be too enormous. APPA does not believe that anyone should presume that the CO 2 from po wer plants to be injected into i n situ or distant geology should be presumed to exceed 50% of the total CO 2 in the first few decade of the commercial deployment. APPA has no notion that the future foss il power plants with CCS will be carbon neutral given the larger volume of coal to be consumed in the gasification process in order to make up for parasitic power losses. 6. APPA enthusiastically supports a UIC Class VI permit classification despite our questions about feasibility and commercial deployment of the technology in 2008

. Development of a permitting system soon is necessary to provide regulatory certainty to the first generation demonstration projects that are essential before
the commercial de velopment of larger scale plants.
7. Congress must address a number of critical lia bility issues under CERCLA and RCRA to enable widespread commercial deployment of geosequestration of CO 2 from power plants. That issue primarily is outside the scope of thi s rulemaking but must be acknowledged. Unless these issues are resolved, first generation plants cannot progress. As EPA recognized in its ANPR on CO 2 , this UIC rulemaking provides one opportunity to address these issues, while protecting the public health and welfare under the Safe Drinking Water Act.10

8. “Acts of God” such as CO 2 or other substances released from seismic events where seismic events could not have been reasonably anticipated by experts should not have liability attached to the owner/opera tor or other parties if the parties acted in a responsible way and could not have reasonably anticipated a fault or seismic risk. 9. State governments , the EPA, power plant owner/operators, water utilities and the public need more data on water and subsurface geology /hydrology before we can actually begin wide scale deployment of new CCS plants . APPA strongly encourages EPA , DOE/NETL , U.S. Geological Survey (USGS) and state geologists/hydrologists to work to gether to improve our knowledge on both surface and subsurface geology. APPA believes it will be helpful for Congress to better understand the technology and to fully fun d demonstration projects so that there is sufficient understanding of geology to support widespread geosequestration.

Background
A PPA has a very unique perspective and knowledge base from which to provide meaningful input on the development of EPA's UIC regulations for CO 2 sequestration

. Wh at makes APPA unique is that of our 1,400 member utilities (owned and operated by local govern ment

— usually municipalities), over 80% also manage local drinking water for residential consumers as well as commercial and other parties

. It is with that background information that we offer a somewhat more cautious view of geologic11

sequestration technolo gy into deep saline aquifers as a presumed commercially available and deployable technology in all states

. G eologic sequestration into all geologic formations must be considered by electric utilities in their long

- term plans for future fossil

- fuel el ectricity generation while also weighing the need to p rotect public drinking water supplies. P rotection of drinking water supplies , for some communities, may mean that inadequate surface water supplies may require that the city (or private utility) may req uire usage of groundwater in future years which may not appear to be “drinkable” under today’s presumed costs and technological (pump and treat or desalination) limitations. Our colleagues in the municipal drinking water operations remind us that Americans are currently drinking water which, in many locations, was undrinkable only 5

- 10 years ago. While most
Am erican cities in the east provide drinking water made up largely of surface water, more than 90% of all drinking water systems (private and public) us e some amount of groundwater to make up for shortages. Acknowledging this does not mean that geosequestration should not be allowed. It simply requires common sense decision making at the local and regional level by power plants and the state directors as to the best placement of geosequestration plants or off

- site injection formations.
W e thank EPA for the regional workshops and public hearings associated with this proposed rule , the willingness of staff to meet with our electric (and water) utility
rep resentatives, and for the openness in the meetings about the tough issues inherently involved with drinking water protection with an entirely new technology (given the scale) for the power plants sector.12

The EPA’s proposed rule asks for comment on many issues which are new to the power sector. EPA does its best to tease out what we know from the use of CO 2 injection/recycling from the oil and gas sector and try to apply some of these concepts to the future power sector parties who might need to build coa l

- fired electric generating plants but would be required to reduce emissions of carbon dioxide through the combination of carbon capture technology at the plant and GS at an injection site

. Carbon sequestration can employ any of several physical, chemica l, or biological processes to isolate CO 2 from the atmosphere, on a long

- term basis. Carbon sequestration can be terrestrial and geological. As part of the Earth’s carbon cycle, terrestrial sequestration uses vegetation and the soil as carbon sinks. There are both technical and non

- technical challenges to sequester large quantities of CO 2 in subsurface repositories. The technical challenges are exacerbated by a lack of experience with processes on an appropriate scale, or in geologic formations that have

no history of oil and gas production. The non

- technical challenges

– in the form of legal and regulatory issues

– are as significant as the technical uncertainties. But APPA supports research in order to assist us to make these changes. The amount of CO 2 t hat could be required to be sequestered is enormous. The generation of power by coal

- fired power plants in the U.S. produces 1.5 billion tons of CO 2 that, when compressed to supercritical conditions, c omprises a volume that exceeds that equal to U.S. oil c onsumption. The task of transporting and managing this volume of material is complicated by the need to operate the transport in a pipeline at 2,000 psig to maintain CO 2 in a fluid state in these specialty pipelines.13

APPA does not question the viability of the technology of carbon dioxide injection for enhanced oil and gas recovery in production fields. Any questioning about the technology in the context of these APPA comments pertains to new large scale power plant parties which would likely be built outsi de the geologic formations suitable for oil and gas recovery. While the proposed rule asked for comments on the impacts on other industries, these APPA comments focus on power plants. We don’t offer comments on carbon separation and injection/storage for ethanol plants, chemical companies , cement factories, or coal bed methane plants that might have similar opportunities to inject CO 2 . APPA has no comments on more shallow methane recovery from coal operations.

APPA strongly supports private and DOE/NETL geologic

se questration demonstration projects to tell us more about the technical viability of the separation technology and the scaling up of geologic sequestration. Further, these projects must also support any geosequestration or GS research projects that would be tter enable us to know more about the USDWs and protection of that critical resource

. The “location is everything” is a critical presumption for the reader of our
comments on the proposed UIC rule . In some locations geosequestratio n will be an optimal technology that makes sense for those future coal plants. In other locations, the type of rock, the lack of trapping mechanisms or proximity to underground faults, seismic risks or other14

Our comments pertain to large scale powe r plant applications and those much larger CO 2 injections and storage in geologic formations. There may be opportunities in the early years for the placement of coal plants for geosequestration in the shadow of the oil and gas industry where there would be opportunities for EOR/EGR. APPA encourages this and believes that this may be beneficial to many parties

— including the power sector. If all new coal power plants could be built over geologic formations that have oil and gas recovery operations or where the CO 2 could be stored in depleted wells, the economics would be far more favorable for the power sector. However, even if that were the case , the drinking water protection issues do suggest some initial caution in site selection

. Our comments here shou ld not deny the viability of CCS in some subsurface locations nor be read as APPA’s view that geologic sequestration works in all geologic locations or for all power plants. T here is a great deal that we do not yet know about the wide variety of geologic f ormations to know that there are no risks to USDW s or that we could identify specifically what those risks might be. APPA hopes that on

- going private and public research in the United States, Canada, Australia , and Europe will affirm that
there are n o risks to drinking water supplies or that the risks are so truly negligible that there is no reason to hesitate to use this technology

. But we cannot presume that there are no risks simply based upon the commercial and technical success in CO 2 recycling
i n Class II injection locations that are managed as production fields. It has been presumed that because the CO 2 injections began in the Permian Basin of West Texas in the late 1970s that the CO 2 from those tertiary recovery fields (for oil or gas) is
actua lly still in the formation. In most cases the CO 2 was recycled and used in different15

product ion operations. Even if the CO 2 was injected 25

- 35 years ago , the CO 2 may not still reside or remain in storage there

. Because we have not seen large storage fields
where the CO 2 was stored for 10

- 30 years on a sustained basis, there is not as much known about the geologic formations , the adequacy of holding capacity and subsurface
im pacts as we would like to know. Also, i n many cases, those oil or gas production fields are regulated differently than a newly established long

- term GS formation would be regulated if it were owned/operated by a power company

. But, APPA do es believe that the CCS plants that will be proven vi able deserve a permitting mechanism under the EPA’s proposed Class VI program. APPA has no hesitation about a Class VI permitting system

. APPA encourages the U

. S

. EPA to finalize this new category as soon as possible to facilitate the permitting and construction of first generation U.S. demonstration projects. Som e personnel at the U.S. EPA and members of Congress often assume falsely t hat CCS or GS is commercially deployable now in all states based upon the success in the half dozen or perhaps as many as a dozen oil/gas production states. T he development of a national viable and workable CO 2 capture and sequestration permitting program is one of the key prerequisites to the implementation of
contem plated energy reform initiatives

- ranging from state laws that force reductions in CO 2 to pending new Federal legislation to require a national cap (on CO 2 emissions

. )
APPA’ s comments are offere d here on the UIC permitting system are valid regardless to whatever “carbon signal” there might be to reduce CO 2 from power plants. Even if there is no new national law setting a carbon emissions limit, intensity limit, carbon tax, or new generation requi rement, states also have the ability to set state by state limits on16

carbon dioxide emissions from power plants under separate state CO 2 laws. APPA does not like patchwork quilt state by state regulatory approaches to reduce CO 2 through different laws and regulations

. It is entirely too soon to know what Congress
mi ght do. At this time, we have no clue what Congress might do in the future to
constrain CO 2 that would motivate any party to reduce CO 2 from coal or natural gas plants. APPA’s comments are ne utral as to the new legislative mechanism that would

“ constrain carbon ”. T hese technical, logistical, or cost issues are valid regardless of why utilities would want to inject CO 2 under any carbon dioxide mitigation standard, reduction policy , or law

. EPA contemplates that the electric power sector "will most likely be the largest potential market for carbon capture and sequestration (CCS) technologies, with the potential to reduce CO 2 by approximately 80

- 90% at an individual plant." EPA’s figure

seem s extremely optimistic and perhaps unrealistic given what we know about both current demonstration projects of carbon separation and geologic sequestration

. We do not recommend that anyone assume that 80

- 90% of CO 2 from the power sector can actually be se parated and STORED or sequestered in all geologic formations given our
current knowledge. Wh ile separation of CO 2 from the other air emissions might be achievable at 8 0

- 90%, presuming this number for geosequestration that EPA offers seems overly rosy. Se e 73 Fed. Reg. 44354, 44492. The oil and gas sector does not universally store 80

- 90% of the CO 2 that is recycled in its current EOR/EGR operations

. In our review of descriptions of current EGR/EOR, as much as 95% of the CO 2 can be recycled many times an d someti mes the remaining CO 2 is ultim ately vented to the atmosphere

.17

Figure 1

– Enhanced Oil Recovery Schematic Showing CO 2 recycling (source: American Geological Institute)
Separation and storage capacities may be very different at e ach geologic formation or subsurface location. APPA is not offering this as a criticism of oil/gas operations but simply explaining that there are many myths about actual retention of CO 2 in oil/gas recovery operations and how translatable that experience is for the power plant sector

. Regardless of the actual future volume of injection (or perhaps the ultimately limited success of carbon separation and ultimate injection), a practical Class
VI permitting system is essential

. Given the direct impact th is program will have on the electric utility industry, APPA genuinely appreciates EPA's goal of establishing a regulatory regime that will provide "certainty" and "transparency" to what requirements would apply to owners/operators who engage in Class VI CO 2 injection. Id . at 43496 (July 25, 2008). At the same time, it is crucial for the regulations to reflect the challenges inherent in crafting controls for commercial CO 2 injection and storage activities when such large

- scale commercial operations are onl y at the nascent stage. Given what we know now, APPA remains rather skeptical that the large scale18

operations as envisioned by the popular or trade press (and perhaps EPA’s proposed rule’s preamble ) are very possible in the next few decades

. DOE’s original estimate that this new commercialized CCS industry is possible in about 40 years is probably more realistic

. Of course, APPA hope s that there are technology breakthroughs and that CCS or GS can be viable on large r scales which also remain protective of USDW s within the
next 15 years

. But we believe these larger commercial size power plants with > 10 tons of carbon sequestered annually would likely come online after 2025. We hold this hope on CCS in the same context as in hoping that there will be breakthroughs in large capacity battery storage or in storage for wind capacity or for new nanotechnology for solar panels. All are needed to achieve improvements in a power plants’ carbon footprint and in reducing criteria pollutants. W hile we may hope for technology and infrastructure breakthroughs, we plan on geologic sequestration based upon cold reality. The last thing that APPA wants is to promise what we might not yet be able to deliver. One of the largest hurdles: Parasitic Power The fundamental challenge confronting the utility industry is in carbon separation and in reducing the parasitic loss of energy at a power plant. Parasitic loss issues at power plants are best explained in Attachment s 2 and 3 by Doug Carter. These t wo papers explain to both laymen and technical experts why parasitic energy could be one of several “deal killers” for new power plants with GS. 4 These parasitic are problems that are very fundamental and will determine whether power plants pursue t his

4 L.D. Carter, White Paper, "Carbon Capture and Storage From Coal

- based Power Plants: A W hite Paper on Te chnology for the American Public Power Association (APPA)," May 2007 and L.D. Carter, White Paper, "Retrofitting Carbon Capture Systems on Existing Coal

- fired Power Plants," Nov em ber 200719

te chnology or opt for another type of generation such as nuclear power or perhaps natural gas (which has roughly half of the carbon dioxide as coal). See Figure 2 which highlights the processes which contribute to the parasitic power demands of CCS. Even if carbon separation technology is commercially demonstrated at > 30 MW in the next few years, parasitic power or ener gy losses are a huge disincentive to use this new generatio n technology.

Figure 2

– Parasitic Power Losses in CCS Power Plant20

The storage issues can be equally daunting but the fundamental question of separation and parasitic power are so overwhelming that it is not entirely clear how many municipal governments will want to pursue t his technology until those economic issues (especially the parasitic power) are sorted out. The other remaining issue in the three legged footstool is the question of infrastructure and logistics . Without a massive investment in infrastructure for additio nal pipelines and booster compressors, APPA wonders how many of these plants will be built in the first 10

- 30 years. The oil and gas industry had 35 years to build up the essential infrastructure for CO 2 injection in the context of oil and gas recover y. This infrastructure includes pipelines, booster compressors and feedstock delivery. See Figure 3 for a map showing current CO 2 pipelines in the U.S. T he industry also has systems in place to remove/treat produced waters. These systems are not in place in states with no oil or gas production

. Those oil and gas recovery fields were and are highly profitable and had a revenue stream to offset the investments in delivery methods such as construction of pipeline or adaptation of existing natural gas pipelin es , booster compressors, or for the use of tankers for some small quantities of CO 2 for use at production fields. The economics for power plants are not yet ripe for such investments because power plants would not have the additional revenue stream coming in for infrastructure investments coming off the oil and gas production revenue stream Nor are the right of way or surface right issues sorted out by state law before CO 2 can be either transported across jurisdictional lines or stored as a commodity without surface property righ ts being sorted out

. These commercial and practical im pedim ents to geologic sequestration (GS ) are enormous and should not be minimized simply21 Figure 3

– U.S. CCS Pipeline Mp

because we wish to find a technology that will work to enable us to use coal or natural gas in the future

. These commercial, technology and feasibility im pedim ents are not EPA’s problems to fix

— but they are mentioned here because we are trying to inject “reality” into the zealous discussions in the trade press, on television, and a t coal plant hearings about the viability of geologic sequestration at new coal plants in 2008 . These same issues apply to the existing coal plant fleet. T hese same commercial issues apply in the context of natural gas generation sources whe re no carbon separation technology exists today without dramatic parasitic power impacts which would typically be too onerous for existing plants

.22

EPA , in this rulemaking , must establish a cost

- effective and environmentally sound regulatory program to cove r a range of operations in order that the technology
will be commercially deployed

. To meet this challenge and establish a workable regulatory framework over the coming decades for the long

- term storage of CO 2 , it is
im perative that EPA take care to craft the regulations with flexibility so that they may be fine

- tuned as industry and regulators alike gain experience with the large

- scale CO 2 sequestration contemplated by this rulemaking. APPA applauds EPA’s efforts to build such flexibil ity mechanisms into the Proposed Rule , including the use of state directorial discretion and the provision for forthcoming guidance to clarify other requirements

. APPA agrees that both of these methods will help create a regulatory fra me work that can evolve as information and technological advancements are gained in the field of carbon capture and sequestration

. EPA asked for comments on financial guidance on any aspect of the f inal r ule (for example, clarification of requirements for financial assurance mechanisms)

. APPA
think s that this might be an area where the EPA might call for a “second bite at the apple” after we know more from the preliminary carbon sequestration projects and “scaling up” project s . We agree with Utility Solid Waste Activities Group ( USW AG ) and others who have suggested that that guidance must be developed in accordance with OMB’s Good Guidance Practices Bulletin, which directs that notice and comment be provided for the development of ”significant” and “econom ically significant” guidance
documents. Because information and technology related to carb o n sequestration are sure to develop as more experience is gained, APPA urges EPA to do what it can avoid the use23

of arbitrary or blanket prohibitions or absolute s in the EPA f inal r ule. H owever, APPA believes that there are some common sense prohibitions that may be justifiable. For example, EPA should have in the final rule an explanation, consistent with the Class I program, that seismic

- induced subsurface conveyance risks such as major faults, or proximity to sole source aquifer 5 protections are essential

. Sole source aquifers are not the same as deep saline aquifers. APPA believes there are some prohibitions that are ke y to protect ion of USD W s. At the same time we do not want to contribute to “NIMBY” or “not in my backyard” or “NUMBY”

— or “not under my back yard”

. Wh at A PPA asks for in the context of s eismicity issues a re clear

- cut and understandable parameters or USG S guidelines so that power plant owner/operators don’t pursue a geologic formation thinking that it is eligible only to learn that the EPA has used a USGS designation on seismic risks that would render it disqualified later in the permitting process . APPA asks that when the EPA or state directors make seismicity conditions that these be subject to notice and comment and be published in the Federal Register and the state equivalent publication . It would be terrible to have a power plant owner/oper ator spend time and significant money pursuing a geologic formation only to learn after he had spent many hundreds of thousands of dollars that the site did not meet the EPA’s seismic risk or USGS seismic requirements. Seismicity risk avoidance is a new fa ctor for thermal or fossil plants and not one with which we have experience. APPA includes in the Appendix a paper from an NETL

- funded study on seismic activity induced by injection of

5 A sole source aquifer (SSA) is an underground water supply design ated by the U.S. EPA as the "sole or principal” source of drinking water for an area under Section 1424(e) the Safe Drinking Water Act of 1974. “Sole or principal” has been interpreted to mean that the aquifer must supply at least 50 percent of the drinki ng water to persons living over the aquifer ; there should be no alternate and feasible sources of drinking water that could replace the aquifer.24

CO 2 into deep saline aquifers 6 and an article regarding the Greek gover nment’s concerns with injection of CO 2 in the Mediterranean

. 7 Including these references to
seismic issues does not mean that APPA fears that CO 2 will cause seismic activity. Instead APPA does not want to see APPA member utilities pursue geology which has underlying seismic risks that are unknown to the power sector (and perhaps to the state agencies) and mi suse critical resources, time and money pursuing that location for permitting only to find out later that they must start again. Most locations i n the U. S. have not had recent seismic data assessed at the “fine granular” level needed to target the right formations for carbon dioxide geosequestration. This will necessitate the support of United States Geologic Survey and other agencies.
We agree with EPA that the appropriate standard underlying technical requirements for CO 2 GS wells should be the protection of underground sources of drinking water (“USDWs”). Even though i t is difficult to know at this point what methods or technology will be dev eloped for injection and long

- term storage of CO 2 in a m anner that is protective of USDWs

– we know intuitively that sole source aquifers and some high risks seismic locations should be ineligible. Proximity to Class IV wells might also
be in appropriate (al though those wells are very rare) because of their contents. In areas where there has been a history of Class I or Class II leakage or USDW contamination problems the state directors should have full discretion to take those locations off the table for injection for long

- term storage

. A PPA assume s that state directors will know best which geologic locations should be unsuitable or ineligible. But,

6 Issues Related to Seismic Activity Induced by the Injection of CO 2 in Deep Saline Aquifers, Joel Sm inchak an d Neeraj Gupta, Battelle Memorial Institute 7 “W hy doesn't Greece like carbon capture?” Leigh Phillips, EU Observ er, 9/23/08, http://euobserv er.com/19/2679425

we acknowledge that there are some risks not worth taking. Sole source aquifers are just not worth the risk for CO 2 injection no matter how noble the goal of CO 2 reductions
mi ght be. There are perhaps 10

- 15 sole source aquifers in the United States so APPA does not believe that removing these locations restricts the available geology storage in any sig nificant way on a national basis. In some cases, those power plants might need to be coal or gas with other carbon dioxide mitigation strategies such as the purchase of renewable credits or other measures that are outside the scope of this rule. APPA does not suggest that coal plants cannot be built near sole source aquifers since sequestration could be conducted off

- site if the infrastructure for moving the CO 2 is in place or would be in place within a reasonable date after start up of the new po wer plant

. APPA is not expert on drilling practices and many of the site characterization techniques discussed in the proposed rule

. As discussed below, the Final Rule should leave the door open for a range of injection sites (except for sole source aqui fers which we believe should be excluded f rom consideration ) and methods (some of which are unrecognized, or even unknowable, at this point in time), provided that the Owner or Operator can show that the injection and storage will be protective of USD Ws. A PPA does join its “sister” organization, A WWA, representing the water utilities , in calling for proposed GS projects to at least identify all the confining zones in applications. APPA does not believe that multiple confining zones should be arbitrarily req uired. W e defer to
state directors to make these judgments based upon their knowledge of local geology.26

Area of Review: APPA has nominal background in Area of Review, b ut we do believe that AoR sites require peri odic review. Given the fact th at carbon sequestration technology is still developing, and the widely varied characteristics and limitations of different CO 2 GS projects, it is essential to incorporate performance

- based standards into the Final Rule, with site

- tailored approaches to req uirements for Area of Review (“AoR”) reevaluation and post

- injection site care and closure periods. APPA believes that the AoR should be periodically reviewed at least every five years for the first 10 years. At the conclusion of the tenth year APPA belie ves that a less stringent periodic review should be allowed by the director if he so chooses. However, APPA believes that the operation of the power plant should not be stopped if the geologic storage or sequestration is deemed ill advised by the state dir ector (or court). Only the CO 2 injection in that location should cease. Instead the owner/operator of that power plant should be allowed to continue operations for the purpose of generating electricity (and other functions) without CO 2 injection un til either a different technique is developed or until infrastructure can be built to move the CO 2 to a different injection location. In some cases, the power plant owner/operator will simply have to make commercial or contractual arrangements to pay a par ty to take the CO 2 for injection or geoengineering
mi tigation measures (not yet identified).

Use of proprietary models: EPA asked about AoR and proprietary models. APPA is not expert on models but has some general discomfort with relying solely on prop rietary models owned/operated by a third party

— particularly when there are only approximately five companies in the United States that have such sophisticated models for AoR27

modeling

. Proprietary models are de rigueur in the oil and gas extractive indust ry. We would not seek to change that for such a critical industry to our economy and to our own
natural resource needs

. However, it would not lead to an easy future for power plant

owne r/operators to not know how site selection and AoR decisions are made because the owner/operator of the AoR work would use confidential the proprietary models from even the power plant owner/operator. It would be rare to have such a significant portion of the operational costs where the power plant’s management could no t review the model or run a cross check proprietary models to affirm site selection or to do double
checks after operations had begun. This is a tricky question for APPA. The AoR decisions will be fundamental to the entire geologic sequestration decision t ree. Yet, if proprietary models are used, the power plant management will have little say over the
ge osequestration operations. Additionally, relying upon proprietary models for such a significant portion of the geologic sequestration decision making will be anti

- competitive. It is not easy for power plants owner/operators to easily know what the costs of an operation will be for the consumers if they are relying upon proprietary AoR models at the beginning of the geologic sequestration process and relying upon these same models during the 40

- 50 year life of the plant. APPA would prefer that the use of a replicatable model is used. This may need considerable work by the U

. S. EPA to ensure that the proprietary nature of these seismic modeling products and services are not exposed in a way that harms the oil field service s industry. Perhaps the EPA can review what confidential business information methods are undertaken in the Food and Drug Administration or Homeland Security Administration as those agencies review very28

confidential drug testing or security data which much be confidential but still usable and able to be reviewed

. APPA respects that the true value in the oil and gas extractive industry is in the quality of its seismic readings technology and models that make it the pre

- eminent in the world. No one at APPA wants to tamper with that. We wonder if some sort of proprietary method can be arranged for the AoR models to be run off of proprietary models where
the model can at least be reviewed or re plicated for quality purposes by the state
director and the power plant owner/operator . Without this ability to have a handle on operational costs and decisions made by the contractors to the power sector , many public power communities would be reticent to commit to a technology where the proprietary model sets in motion most major decisions without a way to review them or make mid

- course corrections.
APPA outlines below its major views on the proposal and then provides a more detailed discussion regardin g these issues.

· Because the technology described in the Proposal will not be commerciall y and widely deployed (in states without oil and gas production ) for perhaps as long as 30 years , the Final Rule must be flexible enough to accommodate developmen ts in information and technology related to carbon sequestration. These developments could reflect knowledge that affirms the technology and minimizes any cautions or concerns expressed by APPA re garding USDW risk, liability, etc.

· APPA is really not qual ified to comments on site selection or well construction or injection procedures. APPA defers to decision making by the state directors (or EPA in the case of non

- delegated states on these aspect ) . EPA’s Final Rule should keep as many options regarding si te and method of injection available, subject to the standard that any CO 2 GS be protective of underground sources of drinking water (“USDWs”). Because state regulators in approximately five or six states have worked extensively with Owners or Operators of UIC Class V experimental CO 2 wells they have29

familiarity with environmental, geologic, and financial concerns specific to a given region, their adoption and tailored implementation of the CO 2 GS rules will be crucial to the success of the Program.
Al though there are significant sim ilarities between the proposed requirements for Class VI wells and the existing requirements for Class I, II, and V wells under the U IC Program, APPA does not believe that there should be a presumed grandfathering of Class I , II and V for the Class VI as storage sites. APPA cannot easily imagine why an oil and gas production field would typically want to move from a Class II to a Class VI
well classification since oil and gas recovery is always technically possible at the rig ht price. Besides, UIC Class II production classification has certain other regulatory and commercial advantages to remain as Class II to the oil and gas sector. Few wells are truly ever 100% depleted since newer technology may make unreachable oi l and gas obtainable

. APPA does not oppose state directors who believe that they should grandfather a well from Class II to a Class VI provided that it can be demonstrated to the state’s satisfaction that such carrying over of requirements will be protective of USDW s.

· EPA prematurely assumes that the CO 2 injected for GS is a solid waste. The CO 2 that will be captured and injected for long

- term storage into Class VI wells is an uncontained gas and therefore does not meet the statutory definition of a "solid waste" under the Resource Conservation and Recovery Act (“RCRA”). Further, it is premature to as sume that material will be "discarded" as CO 2 is currently used as a commodity in a variety of manufacturing processes. To the extent there is any possibility that CO 2 injection operations could be subject to RCRA controls, EPA should exempt such activiti es from RCRA's corrective action program under the well established "contingent management" concept given that the UIC permit will ensure that the injected material is not mi sm anaged. APPA is confident that state directors will have strict rules on how the injections are managed. On this topic of RCRA and solid waste, APPA defers to the Utility Solid Waste Activities Group (USWAG) and recommends those aspects of their comments

.30

· The Final Rule must not make the application process overly burdensome or unr ealistic by requiring detailed information that may not be available at the time of the initial application; instead, the Final Rule should allow for submission of updated information regarding a CO 2 GS well and its AoR as that information becomes availabl e through phased corrective action.
General Issues Related to Classification and Regulation of CO 2 GS Wells
APPA believes the creation of a new category of wells under the UIC Program for long

- term storage of CO 2 is appropriate. Id . at 43502 With res pect to the inte gration of State programs, APPA agrees with EPA that the Final Rule should create a delegable program and encourage the adoption and
im plem entation of that program by States . APPA realizes that some states have no experience with oil and ga s use of CO 2 but encourages all states to adopt the program. Adopting the program does not automatically presume that all power plants built and operated in those states will be able to conduct geologic sequestration in that state

. Id . at 43497. State regulators have familiarity with local environmental, geologic, and financial concerns, and in many cases have pre

- existing relationships with the regulated community that can facilitate implementation of a new and complex regulatory program.
For these r easons, APPA also believes it is appropriate to allow States to obtain prim acy for only Class VI wells if a particular State so chooses

. Id . at 43523. Such
class

- specific primacy is consistent with the statutory authorization behind the UIC Program, and EPA correctly predicts that States obtaining primacy for Class VI wells, regardless of whether they have sought primacy under other aspects of the UIC program, may be more likely to develop a comprehensive regulatory program for all aspects of carbon captu re and storage. Id .; see also 42 U.S.C. § 300h

- 1 ( SDW A31

§ 1422). Simply put, APPA is not trying to force states to have Class I and Class II UIC programs in order to have Class VI programs. States may well decide that they still are not comfortable with a Class II or Class I UIC program. APPA has no desire to change those state policies through this UIC rulemaking.

Grandfathering Requirements of Class I, II , and V UIC Wells This is an extremely impo rtant issue as a few APPA members plan to invest substa ntial resources in developing and permitting Class V experimental CO 2 injection wells to help demonstrate the viability of large

- scale commercial deployment of CO 2 sequestration. Some of these may also be conducted as DOE/NETL or state research
or demonstr ation projects to illustrate how CO 2 can be separated and injected. F ederal and state governments should encourage these research and demonstration efforts, as their success is critical to the large

- scale commercial deployment of CO 2 sequestration. The o pportunity to operate these wells on a regular basis after they have been shown to
be e ffective on an experimental basi s should be allowed to help encourage the substantial, upfront investment necessary to get these wells permitted. APPA believes that th e state should be allowed to grandfather of construction requirements for existing Class I, II, and V wells seeking a Class VI permit for GS of CO 2 if the state believes that the Class V experimental well USD W protections are adequate. Since most of the se new Class V experimental permits appear to be mirror im ages of Class I programs, APPA does not see how this will be a problem. Id . at 43502 In the case where the Class V program mirrored the Class I program, g randfathering of requirements beyond
those related to construction is both necessary and appropriate, particularly for Class V32

wells. As an initial point, it has already been determined through the permitting process that the operation of these Class V wells is protective of USD Ws. See 40 C.F.R

. § 144 et seq. Having made this determination, there should be a regulatory presumption that conversion of these wells for the exact same activity

– at a larger scale and for an extended time period

– under the Class VI program is also protective of USD W s. However, APPA acknowledges and believes that the EPA final rule should clearly state
that this should be done with the understanding that grandfathering will not be allowed if the Director demonstrates that conversion of these Class V experimental wells to Class VI would jeopardize USDWs.
APPA recognizes that there are differences between Class II wells and Class VI wells that may necessitate additional requirements and safeguards as Class II wells transition to Class VI wells. 73 Fed. Reg. 43502. H owever, APPA recommends that the Final Rule include an option whereby Owners or Operators of Class II wells can make a demonstration that their well(s), if used for CO 2 GS, will not pose a threat to USDW s. Such a case

- by

- case demonstration would allow for the carrying over of Class II well requirements where appropriate and protective of USDWs , maximizing the efficiency of such transitions while ensuring that USDWs remain protected.

Siting of CO 2 GS Wells As discussed above, APPA believes it is counter

- p roductive at this stage in the development of a CO 2 GS regulatory regime to categorically preclude any potentially feasible injection formations as possible long

- term storage sites with the exception of sole source aquifers

. EPA correctly recognizes that the commercial deployment of CO 233

GS activities will result in the new production of large volumes of CO 2 for which o wners

o r o perators will have to locate new and environmentally protective injection zones. I t makes sound policy sense for EPA to encourage the identification and utilization of as many protective zones as possible, with the prerequisite that any injection site be protective of USDWs. I njection of CO 2 should be allowed as long as it can be demonstrated that injection will be protective of U SDW s and meet other applicable conditions for Class VI CO 2 GS wells. APPA offers no opinions on injection of CO 2 into coal seams. APPA defers to the American Water Works Association regarding the questions pertaining to whether above or below the lowermost USDW

. The EPA asked for comments on basalt , salt domes or shales. APPA is not qualified to offer any opinions about formations such as basalts, salt domes, or shales

. APPA presumes that these site choice issu es will be clearer after demonstrations by the U.S. DOE regional partnership and pr ivate R&D pilots

. Id . at 43503. If it can be demonstrated that the injection of CO 2 into such sites is protective of USD Ws , then such activities should be allowed under the Class VI UIC program. At a minimum, we know that more demonstration projects are needed looking at diverse geology for maximum use of coal which is an essential fuel source

.

Interaction with RCRA The U.S. EPA seeks comment on the question of whet her CO 2 that exhibits a Resource Conservation and Recovery Act or “ RCRA ” hazardous waste characteristic should be precluded from injection in a Class VI CO 2 GS well. Id . at 43503. APPA34

questions the underlying premise behind EPA's discuss ion regarding the potential applicability of the RCRA hazardous waste regulations to CO 2 GS. Id

. The fundamental error in EPA's request for comment on this point is its premature assumption that CO 2 is being discarded and therefore is a solid waste. A material cannot be a RCRA hazardous waste if it is not first a "solid waste." See 40 C.F.R. § 261.2

. The statutory definition of "solid waste" is limited to specified

" discarded " materials; a material cannot be a "solid waste" unless it has first been
"d iscarded." 42 U.S.C. § 6903 ( RCRA § 3001 ).
Wh ile there have been numerous judicial decisions addressing what constitutes "discard," the fundamental holding from these case s is simple and straightforward: Congress intended to extend EPA’s authority to regulate “solid waste” under RCRA

“ only to materials that are truly discarded, disposed of, thrown away, or abandoned” American Mining Congress v. EPA , 824 F.2d 1177, 1190 (D.C. Cir. 1987) (emphasis added)

. The D.C. Circuit has emphasized that the "plain meaning ” of the term “solid waste” extends only to materials that are “discarded” and that the term "discard" should be interpreted with reference to its ordinar y mean ing

. Ass’n of Battery Recyclers, Inc. v. EPA, 208 F.3d 1047, 1051

- 52 (D.C. Cir. 2000). CO 2 is a valuable commodity used in a variety of manufacturing operations, including in the enhanced oil recovery (“EOR”) and enhanced gas recovery (“EGR”) production process. When used in these commercial oil/gas production applications, CO 2 is not “di scarded” and therefore is not a solid waste. While large volumes of CO 2 will be produced under the carbon capture and sequestration programs contemplated by the UIC Class VI program, it is premature for EPA to presume that these additional35

volumes of CO 2 will not retain commercial value and that their sequestration in Class VI wells automatically means that they have been “discarded” as that term has been defined under RCRA. As we have already noted, the Agency should refrain from making categorical assum ptions associated with this still

- emerging technology associated with the commercial deployment of CO 2 GS operations, including with respect to the status of captured CO 2 destined for GS. Finally, assuming, for purposes of argument, that CO 2 is “discard ed” and exhibits a hazardous waste characteristic when injected for long

- term sequestration, there are compelling policy reasons to exclude such activities from RCRA regulation. Subjecting these injection operations to regulation under a Class I UIC haz ardous waste injection permit could expose all other waste management units at the power plant facility, including units that are in no way related to the injection operations, to the full panoply of RCRA’s Subtitle C corrective action program. This is be cause a Class I UIC hazardous waste injection permit is a classified as a RCRA “permit by rule” under RCRA’s hazardous waste permit program. See 40 C.F.R. §§ 270.1(c)(1)(i) and 270.64. Facilities that have obtained a RCRA permit by rule for the operation of a Class I UIC hazardous waste injection well are potentially subject to the full scope of RCRA’s corrective action program for all solid waste management units ("S WM Us") located at the facility. If RCRA were to regulate the CO 2 as a waste this wou ld m ake many power plant owner/operators reticent to pursue these technologies. See EPA RCRA/Superfund Hotline Monthly Summary, "Corrective Action for UIC Wells," April 1986 (9502.1986(07)). The specter of RCRA corrective action is a significant economic and36

practical operational obstacle for any facility con sidering whether to seek a permit for a new Class VI well for geosequestration

. The im position of this obstacle is completely unwarranted . Any well receiving a permit under the UIC Program for CO 2 G S will be , by definition , protective of USDWs. EPA’s RCRA program has established a legally sound process , referred to as "contingent management," for the ex clusion of materials from hazardous waste regulation when such materials are already subject to an alternat e regulatory regime that ensure s the wastes are managed in an environmentally protective manner. EPA has employed the contingent management concept in several contexts where the Agency det ermined that other regulatory regimes adequately addressed any potential
mi sm anagem ent scenarios related to certain materials , including used oil and military munitions

. The D.C. Circuit has reviewed EPA's legal theory underlying the contingent management concept and found it to be a "permissible construction o f the statute"

– namely, that the statutory definition of "hazardous waste" is predicated upon the risks posed by a solid waste when " improperly " managed; therefore, "where a waste might pose a hazard only under limited management scenarios, and other regu latory programs already address such scenarios, EPA is not required to classify a waste as hazardous waste subject to regulation under [RCRA] Subtitle C." Military Toxics Project
v. EPA , 146 F.3d 948, 958 ( D.C. Cir 1998) (emphasis added)

. APPA believes that RCRA corrective action for the entire power plant would rank with parasitic power loss as strong deterrents to geologic sequestration for many small37

municipality power plant owner/operators

. We do not want to see these C CS projects prevented because of RCRA waste concerns.

Interaction with CERCLA APPA has been bothered by the risks of CERCLA given the complexities of what can trigger CERCLA and remediation under the statute’s ARARs. (Applicable or R elevant and Appropriate Requirements ). A critically important issue on which EPA seeks comment is the interaction of the CO 2 GS regulatory program with the Com prehensive Environmental Response, Compensation, and Liability Act (“CERCLA”).
Wh ile EPA acknowle dges that “CO 2 itself is not listed as a hazardous substance under CERCLA,” the Agency raises the specter of potential CERCLA liability if the CO 2 stream contains other CERCLA hazardous constituents ( e.g. , mercury), or if other hazardous constituents are f ormed when the injected CO 2 stream reacts with groundwater ( e.g. , sulfuric acid). Id . at 43504. As EPA can surely appreciate, the potential for open

- ended CERCLA liability for any contamination resulting from CO 2 GS activities will act as a
serious deter rent to would

- be Owners or Operators of Class VI wells and could jeopardize the contemplated wide

- spread commercial deployment of CO 2 GS operations. CERCLA liability would be the ultimate disincentive for commercial deployment. APPA believes tha t Congress will need to act to correct this risk before commercial deployment should be expected. APPA’s white paper on CERCLA issues by Marianne Horinko , former Acting EPA Administrator, and career policy senior38

manager at the U

. S. EPA on CERCLA and ot her waste matters address these points. That paper is found in the Appendix

. 8 EPA correctly acknowledges that CERCLA’s “federally permitted release” exemption will provide CERCLA protection from those "releases" that fall within the scope of a Class VI p ermit ( e.g. , contained within the Area of Review (“ AoR ”) ) , but the Agency also recognizes the limitations of this exemption, as it does not offer protection for any release of a hazardous substance that is out the scope of the Class VI permit ( e.g. , outsid e the AoR). Indeed, EPA states that any permits will have to "be carefully structured to ensure that they do not 'authorize' inappropriate hazardous releases," including "potential releases from the well which are outside the scope of the Class VI permit. " Id

. APPA appreciates that the contamination issue is extremely important and should be addressed in the Final Rule. However, we have no reason to believe that the technology and safeguards developed to prevent migration of injected CO 2 or its constit uents will fail. At the same time, the specter of open

- ended CERCLA liability will
im pede the ability of Owners or Operators to calculate and demonstrate financial responsibility, obtain financial assurance, and obtain the initial capital necessary to
inv est in this important technology. Simply put, EPA (and Congress) must mitigate the threat of potential CERCLA liability to the extent possible in this rulemaking. One step that the Agency can take is to ensure that final Class VI permits for
individual CO 2 GS projects have the broadest possible reach

– while remaining protective of USDWs

– to maximize the protection offered by the Federally Permitted

8 Marianne Horinko “Carbon Capture and Sequestration Legal and Environmental Challenges Ahead,” August 200739

R elease exemption. This would mean including in the scope of the permit for CO 2 injection all other CERC LA hazardous constituents likely to be contained in the CO 2 stream, including those generated during capture and transport as well as any that could be formed in the injection zone as a result of the injection of CO 2 . Similarly, the scope of the authorize d "permit zone” should be as broad as possible while remaining protective of USDWs. This could mean, for example, effectively authorizing the
mi gration of constituents contained in the CO 2 stream (or resulting from injection) outside the scope of the AoR, provided that such migration does not directly impact a USDW

. The bottom line is that the potential for unlimited CERCLA liability must be
mi tigated to avoid significant delays and a n overall chilling effect for geosequestration

. APPA recognizes that wh ile there are some measures the Agency can take in the regulatory context to address this concern, including those described above, those

measures ma y be limited. In the end, APPA believes that a legi slative solution is critical to eliminate this liabilit y concern

. APPA recommend s that the EPA st rongly support such a broader liability solution and communicate that support to Congress at the appropriate time.

Permit Application and Reporting Requirements The EPA asks for comments about electro nic reporting. A ny requirement contained in the Final Rule for electronic reporting should not be absolute but should instead allow the Director to allow other methods of reporting when he deems such methods more appropriate. APPA imagines that by the time CCS is widely commercially40

viable, electronic filing (or whatever society considers “ electronic filing of data ” will be at that future date ) will be the least of our cost or operational concerns. APPA would suggests that early projects, say in the first five years, have some modest leniency for ways to file effectively and responsibly without the presumption of real time data on every imaginable data point. We also suggest that the EPA have some reasonable test for response to the state or Federal permitting agency in the event that a reporting event happens on a weekend or during nighttime hours. Some owner/operators will be on different time zones than the injection well operator. APPA suggests that a reasonable
tim e be allowed for reporting to b e sent in on routine data where there is no catastrophic reporting event. With respect to the Proposal’s suggestion of an annual reporting requirement for CO 2 GS projects, APPA appreciates the importance of the information EPA seeks to gather but believ es that annual reporting will not always be the best way to collect this information over the lifetime of the project. Id . at 43518. The Final Rule will require some form of periodic reevaluation of the AoR throughout the life of the project; much of
the information sought through the proposed annual reporting requirement would be gathered and submitted to EPA through the AoR reevaluation process. Gathering this information through the AoR reevaluations alone, rather than imposing an unnecessary and dupl icative annual reporting requirement, will provide a more cost

- effective and manageable method of information exchange for regulators and Owners or Operators
alike. APPA prefers the idea of reporting every five years in the first 20 years of operations.41

Well Plugging and Post - Injection Site Care APPA acknowledges that for some potential power plant owner/operators that the Proposal’s suggested fifty

- year default fixed timeframe for the post

- injection site care period is arbitrary and will serve to disc ourage Owners or Operators of CO 2 GS sites from seeking to develop innovative ways to safely close wells in a shorter time period. Id . at 43519. EPA acknowledges in the Preamble to the Proposal that it is likely “that the actual time for CO 2 plume stabil ization ... will be very site specific , being influenced by geologic factors such as formation permeability, geochemistry, and the degree of capillary trapping.” Id . (emphasis added). EPA then goes on to note that the studies used for their preliminary ana lysis suggest that the length of time required before plume stabilization ranges from ten to one hundred years after cessation of injection

– quite a significant range. Id , emphasis added . In the same discussion, EPA reviews a range of suggested time per iods, acknowledging that even a ten

- year tim eframe is suggested by some studies.
APPA understands that a ten

- year site closure period may be insufficient in some cases; there is no single time period that would apply to every CO 2 GS site across the
board. Because of the greatly varied geologic characteristics , APPA believes a po st closure period of 10 years or until the plume is determined to be stable. Stability is to be defined by the state Director t hat he/she does not believe that it can harm USDW s. G iven the concerns by the water utilities, APPA defers to A WWA for their expertise in
this matter. Tracers

– If the state Director believes that tracers are needed, we encourage the least cost tracer be selected from the most effective options . EPA correctly notes42

that some drawbacks can accompany the use of tracers, i ncluding the possibility of false positives. Id . at 43512

- 13. Plume and pressure front monitoring

– Because of APPA’s inextricable link to the municipal water utilities, we fully appreciate the importance of accurate monitoring of the plum e and pressur e front. Id . at 43514. APPA defers to A WWA to comment on monitoring and frequency of monitoring requirements. APPA believes that most early projects will likely monitor far more often than will be unnecessary as more information is gained regarding the a ccuracy of initial modeling.

Financial Responsibility
APPA s upports EPA’s suggestion to issue guidance in the future for clarification of the financial responsibility mechanisms available for Owners or Operators of CO 2 GS
wells. Id . at 43520

- 22. Pr ovided that such guidance is issued in accordance with OMB’s Good Guidance Manual, APPA believes that such guidance could be particularly helpful as the Program advances and industry and regulators gain experience and knowledge related to CO 2 GS projects. APPA believes it is far too soon to offer significant comment on this aspect of the proposed rule

. APPA would like to see that the final rule accommodate a range of options including self

- insurance instruments remain available to Owners or Operators as a method of financial assurance for Class VI CO 2 GS projects. Id . at 43521. Self

- insurance instruments, including the corporate financial test and the corporate guarantee, have been utilized successfully under RCRA over two decades. However, APPA mu st acknowledge that the volume of CO 2 and the length of operations would43

suggest that the UIC Class VI wells will be different. As EPA mentions in the Preamble, the assessment by the Environmental Finance Advisory Board (“EFAB”) of various financial resp onsibility issues revealed no specific failures of the corporate financial test. Id

. APPA is comfortable with the Proposal’s suggestion to allow separate financial responsibility demonstrations for different phases of CO 2 GS projects, specifically for

w ell plugging and then post

- injection site care. Id . at 43522. As EPA recognizes, “post

- injection site care has the potential to extend many years into the future,” and “[t]rying to determine the cost for post

- injection site care ... could be difficult, as could the approval of a financial demonstration.” Id . Requiring all financial demonstrations to be completed at one time, prior to well plugging, could unnecessarily delay the site closure process. Allowing a subsequent demonstration for financial resp onsibility for the post

- injection site care period will allow regulators and Owners or Operators to
better understand the site

- closure needs for a given CO 2 GS project prior to demonstration and approval of financial responsibility.
APPA urges EPA to a ctively pursue a legislative solution to the liability issue

. APPA does not yet have the legislative solution in mind to address long

- term liability under RCRA, CERCLA, Natural Resource Damage Assessment (NRDA) and other
state laws but we know that consid erable effort will have to be made to enable power plants to comfortably enter into these commercial activities without unlimited environmental or tort liability.44

Public Participation
APPA agrees that public participation is crucial to the success of an y individual CO 2 GS project and of the UIC Program as a whole. Id . at 43523. We urge EPA to structure the Final Rule’s public participation requirements to maximize impact without unnecessarily slowing down the application process. To this end APPA believes that public participation would prove most useful after an application has been deemed complete but before it has been approved. APPA is inclined to believe that the states will set up public participation requirements consistent with their existing proposed new plant operations. APPA does not want the EPA UIC Class VI rulemaking to add new steps for permit review or hearings but offers no Federal pre

- emption of ex isting state public participation requirements.

The need for better data for GS to work EPA did not specifically call for comment on additional information needed to enable geologic sequestration. But APPA would like to make some recommendations for consideration in the EPA final rule that would better enable us as a nation to use geologic sequestration in a very responsible manner. First, many states have not conducted modeling on groundwater use and availabity in decades , and the earlier modelin g may have used outdated models and information

. In non

- oil and gas states (or perhaps some mining states) there is little known about the subsurface geology. While APPA greatly appreciates the maps and placement analysis modeling conducted by U

. S

. G eological Service or “USG S ” , Batelle, NETL/DOE and others . We do not believe that we have preliminary characterizations or pre - commercial data as to underground45

formations suitable for injection and long

- term storage of CO 2 . Nor do we know what the storage capacity is for those geologic formations given the volume of CO 2 from power plants. We believe that DOE’s regional sequestration pilots, USGS , and other agen cies can help the EPA and state agency directors in better characterizing these formatio ns and ruling out transmissive faults, historically abandoned wells or mines, or poorly closed oil/gas operations from the 1930s where the well was closed with very poor
closure mechanisms that would not prevent seepage. These formations that need to be

co nsidered by these agencies include deep saline formations, since we believe that
most oil and gas formations will be saturated with CO 2 in the first few years of bro a d commercial deployment

. Oil and gas states have had motivation to keep up wit h subsurface mapping and preliminary characterization of the geology and hydrology because of the revenue streams from oil/gas sales and taxes back to the states. States will need to provide much clearer preliminary characterizations of the subsurface befo re this technology is commercially deployable because even the most modest subsurface
characterization in a deep saline aquifer can take millions of dollars. Many power plant

owner operators will hesitate to undertake such studies in non oil and gas states

. APPA encourages the state agencies to use the available training and resources from USGS. EPA and state agencies should also become familiar with and be trained to use the SEQURE program, licensed by the Department of Energy’s NETL program. SEQURE is an aerial methane detection program which can be used in each state to identify abandoned or orphaned oil and gas wells, mines, and perhaps other subsurface faults that could inadvertently lead to leakage and ultimate risks to USDWs. Other
programs may be appropriate in addition to SEQURE. APPA does not intend to close46

the door to other modern ways to better characterize drinking water resources and the surrounding geology but we encourage the use of SEQURE . We defer to our colleagues
at the American Wa ter Works Association, the A WWA Research Foundation (AwwaRF),
and the Association of Metropolitan Water Agencies who might offer other insights as to
what else is needed. Further, APPA encourages state directors to communicate in substantives ways wit h the state hydrologist or geologist. M any states have not had any motivation to review subsurface geology in many decades. Updating maps and ruling out areas with faults or other unintended methods of conveyance for CO 2 mi gration will be essential to make this program work. APPA encourages the U. S. EPA and states to meet with USGS to discuss other tools available to the EPA and to states agencies.

Leaks and response plans APPA believes that the owner/operator must take remedial action as described in
t he permit’s response plan

.

Monitoring
APPA does not have great expertise in monitoring in GS commercial settings

. However, it makes common sense to place monitors close enough to detect the leak before it can negatively affect the USD W. APPA realizes that some local jurisdictions may require surface monitoring or that OSHA may require surface monitoring for safety purposes. However, we doubt that surface monitoring would do much to protect USDW s.47

Electricity Reliability
Wh ile the EPA UIC Class VI program permitting proposed rule did not call for
comments on electricity reliability, we offer our c omments to NERC on Reliability
Im pacts of Climate Change Initiatives , dated July 16, 2008 , which we believe should be considered. These are included in the Appendix. NERC’s “Reliability Impact of Climate Change Initiatives” (Nov

. 2008) link is : http://www.nerc.com/files/2008

- Climate

- Initiatives

- Report.pdf to the fi nal report (23pp).

EPA to Consider SBREFA Impacts APPA asks that the U.S. EPA consider APPA’s comments under S mall Business Regulatory Enforcement and Fair ness Act (SBR E FA) since > 90 % of APPA’s member utilities meet the threshold for small entities.

E xecutive Order 12866 APPA asks that the U.S. EPA consider APPA’s comments and NERC’s study under Executive Order 12866 and any future Executive Orders on energy expressed by
President

- El ect Obama which covers energy issues.48 Conclusion
APPA appreciates th e opportunity to comment on this important rulemaking initiative and looks forward to working with EPA on this effort. APPA has also file d comments on the EPA ANPR in response to many questions that the EPA has asked on geologic sequestration. It is critical that the EPA’s air, water and policy offices
understand that while APPA will offer reasons why geologic sequestration should not be presumed to be Clean Air Act technological choices under MACT, BACT, LAER , or for NSPS compliance e tc

. , we do stron gly want the U. S. EPA to have a Class VI regulatory system that would allow for these demonstration (and later commercial scale plants) plants. APPA would be pleased to meet with the EPA regarding these issues. We would additionally be pleased to include in any EPA meeting our partners, the American Wa ter Works Association (A WWA) which represents the public and private water utilities who have “front line” drinking water protection obligations.
Attached in the Appendix are APPA’s white papers , background documents and maps which should assist the EPA in evaluating our recommendations.

Contact: Theresa Pugh Director, Environmental Services American Public Power Association (APPA) (202) 467 - 2943 tpugh@appanet.org49 Appendix

- Australia Parliamentary Library, Research Paper no. 9 2008

– 09, “ The potential for renewable energy to provide baselo ad power in Australia ”, by Stewart Needham, Science, Technology, Environment and Resources Section. 23 September 2008.

- L.D. Carter, White Paper, " Carbon Capture and Storage From Coal

- based Power Plants: A White Paper on Technology for the American Public Power Association (APPA) ," May 2007

- L.D. Carter, White Paper, " Retrofitting Carbon Capture Systems on Existing Coal

- fired Power Plants ," November 2007

- Marianne Horinko “Carbon Capture and Sequestration Legal and Environmental Challenges Ahead,” Augus t 2007

- “W ill Water Issues/Regulatory Capacity Allow or Prevent Geologic Sequestratio n for New Power Plants?” J. Gle dhill, J. Rollins, T. Pugh

- Issues Related to Seismic Act iv ity Induced by the Injection of CO 2 in Deep Saline Aquifers , Joel Sminchak and Neeraj Gupta, Battelle Memorial Institute

- Why doesn't Greece like carbon capture? Leigh Phillips September 23, 2008

- GAO study “ Climate Change ” Federal Actions will Greatly Affect the Viability of Carbon Capture and Storage As a key Mitigation Opt ion.

- Statement of Don Broussard, Lafayette, La. Utilities System before the House Subcommittee on Environment and Hazardous Materials On Geologic Carbon Sequestration. July 24 th , 2008

- APPA Comments to NERC on Reliability Impacts of Climate Change Initi atives

. July 16 th , 2008

- Populations Trend Map

- Aquifer Map

## This document is not availabl e in Regulations.gov since it contains copyrighted material that may not be reproduced without consent of the copyright holder.
Contact the EPA Docket Center, Public Read ing Room to view or receive a copy of this docu ment. Requests for copies may be made as follows: In person/writing: Environmental Protection Agency, Docket Center 1301 Constitution Ave NW, 2822T, Room 3334 Washington, DC. 20004 Telephone: 202-566-1744
Fax: 202-566- 9744
Email: docket-customerservice@epa.govLetter ID: 0169 Commenter: Theresa Pugh Organization: American P ublic Power Association
Letter ID: 0169 Comment ID: 23361 Letter Lines: 83 to 88
Comment Code: 2020 1.5.1 Support Class VI designation Comment Code: 5600 2.11 Comments related to UIC Program primacy for Class VI wells
Comment: General Issues Related to Classification and Regulation of CO2 GS Wells -- Pg. 20 APPA believes the creation of a new categ ory of wells under the UIC Program for long-term storage of CO2 is appropriate a nd agrees with EPA that the Final Rule should create a delegable program and encourage the adoption and implementation of that program by States. Individual Response: EPA acknowledges the comment and agrees that tailored requirements for Class VI wells are necessary to address the unique nature of injecting large volumes of CO2 and to ensure that USDWs are protected from e ndangerment. The Class VI requirements are appropriate because of the unique nature and ri sks of CO2 injection for long-term storage (e.g., large injection volumes, long proj ect duration, and reservoir pressure conditions). The GS rule contains tailored requirements for the perm itting, geologic site ch aracterization, AoR and corrective action, well construc tion, operation, mechanical integr ity testing, monitoring, well plugging, post-injection site care, an d site closure of GS wells that directly address issues unique to the nature of large-scale CO2 injection for GS. EPA agrees with commenters on the importance of states having primacy for GS wells given the variety of geologic settings in which GS will be applied. EPA recognizes that State, Tribal, Territorial and DI UIC Program Di rectors are in the best position to evaluate the unique issues related to well depth, geology, and hydrogeology th at are posed by a Class VI well. Some degree of flexibility is needed for Class VI wells becau se each decision made will be site-specific and conditions will differ from state to state. The GS rule balances the need for these site-specific decisions with the need for minimum standards to ensure na tional consistency. The Agency believes that it is important for stat es to use their unique e fficiencies to promote adoption of this burgeoning and important tec hnology, while assuring that USDWs are protected from endangerment through the UIC regulatory framework. EPA encourages states to accept primacy for Class VI, and believes that, due to the importance of implementing an effective, comprehensive, and seamless CCS program, States should be provided the flexibility to obtain primacy for Class VI only. However, given the potential for CCS (encom passing capture, transportation, and geologic sequestration) to be an important part of a na tional priority to address climate change, EPA believes that providing states the flexibility to obtain primacy for Class VI wells independently of other well classes can help foster effective management of CCS. EPA believes that allowing

1independent Class VI primacy may encourage states to take res ponsibility for implementation of Class VI regulations and provide for a more co mprehensive approach to managing CCS projects by promoting the integration of GS activities under SDWA in to a broader framework for managing CCS. Furthermore, GS operations involve ancillary activities (e.g., pipeline operations, pore space ownership, land use rights, and surface access) for which states can call upon other authorities that exist at the state leve l (but outside UIC author ity) to provide a more comprehensive CCS management approach.

Letter ID: 0169 Comment ID: 23362 Letter Lines: 90 to 95
Comment Code: 2060 1.5.3 Comments on grandfathering of existing wells (seeking comment)
Comment: Grandfathering Requirements of Class I, II and V UIC Wells -- Pg. 31
APPA believes that the state should be allowed to grandfather construction requirements for existing Class I, II, and V wells seeking a Class VI permit for GS of CO2 if the state believes that the Cl ass V experimental well USDW protections are adequate. Individual Response: EPA agrees that many Class I, Cl ass II, and Class V experimental technology wells are designed and constructed to withstand exposure to CO2. The final GS rule provides for the construction of these wells to be grandfathered per §146.81(c), provided the owner or operator can demonstrate to the Director that the wells were en gineered and constructed to meet the requirements at §146.86(a) and ensure protection of USDWs, in lieu of requirements at §146.86(b) and §146.87(a). EPA clarifies that decisions regarding th e appropriateness of grandfathering will be made by the Director. EPA clarifies that only the construction requirem ents are grandfathered a nd that all other Class VI requirements (reporting, monitoring, mechnical integrity testing, etc.) must be met following a determination under §146.81(c).

Letter ID: 0169 Comment ID: 23363 Letter Lines: 97 to 102
Comment Code: 2100 1.6 Target Geologic Formations for GS
Comment: Sitting of CO2 GS Wells -- Pg. 32 APPA believes it is counter-pr oductive at this stage in the development of a CO2 GS regulatory regime to categorically precl ude any potentially f easible injection formations as possible long-term storage sites with the excepti on of sole source aquifers. Individual Response: EPA clarifies that the GS rule does not categorically prec lude injection of CO2 into any non-USDW formation types. The purpose of the GS rule is to ensure protection of USDWs from endangerment, and the rule requires that owners or operators demonstrate that wells are sited in suitable systems with geologic formations to receive and confine injected CO2,

2required at §146.83 of the GS rule. The Cla ss VI siting, well cons truction and operation, monitoring and testing, and post-inj ection site care and site closur e requirements are designed to ensure that injected CO2 remains within the target formation. If an owner or operator can demonstrate to the Director's satisfaction that GS in coal seams, basalts, salt domes, or shales can be accomplished in a manner that protects USDWs a nd meets all of the requirements of the GS rule, the project may be permitted as a Class VI well.

Letter ID: 0169 Comment ID: 23364 Letter Lines: 104 to 108
Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment)
Comment: Interaction with RCRA -- Pg.33
APPA believes that RCRA corrective action for the entire power plant would rank with parasitic power loss as possibly insurmountable obstacles for geologic sequestration. Individual Response: EPA received many comments regardi ng the applicability of the RCRA regulations and statute to CO2 st reams that are geologically seque stered under the final Class VI UIC well requirements. As a result, EPA has deci ded to initiate a sepa rate proposed rulemaking specifically to examine the issue of RCRA appl icability to CO2 streams being geologically sequestered, including the possible option of a conditional exemption from the RCRA requirements for CO2 GS in Class VI wells. EPA will consider these comments as part of its development of that proposal. The Agency will consider issues pa rticular to RCRA in the context of that separate rulemaking, and recommends that the commenter read that proposed rule when it is published. The Agency notes that comment ers who wish to submit comments on the RCRA proposal will need to do so during the comment pe riod for that rule. Finall y, EPA also notes that the final GS rule, which adds ne w regulations for Class VI wells under the Safe Drinking Water Act (SDWA), is not making any ch anges to the RCRA regulations.

Letter ID: 0169 Comment ID: 23365 Letter Lines: 110 to 114
Comment Code: 1640 1.3.4 CERCLA issues (seeking comment)
Comment: Interaction with CERCLA -- Pg. 37 APPA believes that Congress will need to ac t to correct the potential for open ended CERCLA liability for any contaminati on resulting from CO2 GS activities before commercial deployme nt should be expected. Individual Response: The Agency acknowledges the comment er’s concern regarding the scope and possible impacts of CERCLA liability on CCS ac tivities. EPA notes that the GS rule is not promulgated under CERCLA, therefore the applicabil ity of that statute wi ll not be determined under the SDWA or the terms of the GS rule, but rather according to th e CERCLA statute itself and any implementing regulations that may apply.

3Letter ID: 0169 Comment ID: 23366 Letter Lines: 116 to 120
Comment Code: 4740 2.7.4 Electronic reporting (seeking comment)
Comment: Permit Application and Reporting Requirements -- Pg. 39 APPA believes that electronic reporti ng should not be absolute but should instead permit the Director to allow othe r methods of reporting when he deems such methods more appropriate. In a ddition, APPA believes that annual Individual Response: EPA believes that electronic formatting is the most appropriate format for submitting Class VI project information to the Director, and based on comments received on the proposed rule, the majority of Class VI GS well owners or operators will have the capability to report electronically, and re quires this at §146.91(e). EPA is developing guidance for states that describes the recordkeeping, reporting, and additional data management needs associated with GS act ivities and provides recommended guidelines on the types of data to be collected for tracki ng GS projects, reporti ng to EPA for compliance tracking, and transfer of data to EPA's GS data system. The recordkeeping and reporting guidance will be available on EPA's web site, at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23367 Letter Lines: 120 to 122
Comment Code: 4760 2.7.6 Proposed reporting frequency (seeking comment)
Comment: such methods more appropriate. In a ddition, APPA believes that annual reporting will not always be the best way to collect this information over the lifetime of the project. Individual Response: The final GS regulation retains the reporting requirements as proposed and does not include a requirement for an annua l report. Instead, EPA believes that periodic reevaluation of the AoR, as re quired at §146.84(e), along with any re visions to the required plans that may be required based on the AoR reevaluation, will promote an ongoing relationship between the permitting authority and the owner or operator. The final GS rule, at §§146.84(c), 146.90(j), and 146.94(d), requires owners or oper ators to review and update the AoR and corrective action plan, the testi ng and monitoring plan, and the emergency and remedial response plan throughout the life of the project. Owners or operators mu st review each plan and identify necessary amendments to the plan or demonstrat e to the Director that no amendment is needed. These reviews must be performed within one year of an AoR reevaluation, following any significant changes to the facility (e.g., the additi on of monitoring or injection wells), or when required by the Director. In no cas e can reviews occur less often than once every five years. See the final rule and preamble for further discus sion on EPA's final approach to reporting and recordkeeping.

4Letter ID: 0169 Comment ID: 23368 Letter Lines: 124 to 131
Comment Code: 5240 2.8.2.2 Post injection timeframe (seeking comment)
Comment: Well Plugging and Post-Injection Site Care -- Pg. 41 APPA believes that the Proposal’s suggested fifty-year default fixed timeframe for the post-injection site care period is arbitrary and will serve to discourage Owners or Operators of CO2 GS sites from seeking to develop i nnovative ways to safely close wells in a sh orter time period. While there is no single time period that can apply across the board, APPA sugge sts that 10 years or until the plume is determined to be stable is sufficient. Individual Response: EPA disagrees that a post-injection si te care timeframe of 50 years is arbitrary. EPA proposed a default post-injection site care timeframe of 50 years based on a review of research studies, indus try reports, and existing environm ental programs. This analysis was included in an EPA-prepared background docume nt that is available in the federal docket, titled "Computational Modeling of Underground Injection of Carbon Dioxide for Determination of Area-of-Review and Potential Risk to Underground Sources of Drinking Water." EPA assessed various default timeframes based on additional review of research studies and evaluation of public comments. While numerous commenters suggested th at EPA shorten the monitoring timeframe, none of the commenters provided sufficie nt data or other evidence to warrant a change in the proposed timeframe. Wh ile the 10- or 30-year timeframe suggested by some of these commenters may be within the ti meframe suggested in some studies, EPA believes that the potential risks of endangering USDWs w ill likely not decline within these timeframes and available data, including data submitted by commenters, do not support a different default timeframe. However, EPA recognizes that alternative timefra mes may be appropriate under limited, specific circumstances. For this reason, the Class VI rule offers owners or operators flexibility regarding the duration of the PISC timefra me by: (1) allowing the Direct or discretion to shorten or lengthen the PISC timeframe during the PISC pe riod based on site-specific data, pursuant to requirements at §146.93(b); or (2) affording the Director discretion to allow a Class VI well owner or operator to demonstrate, based on substantial data during the permitting process, that an alternative PISC timeframe may be appropria te if it ensures non- endangerment of USDWs pursuant to requirements at §146.93(c). EPA believes that a 50 year pos t-injection site care timeframe represents a reasonable and protective monitoring period and available data, including data submitted by commenters, do not support a different default timeframe. Furthermor e, EPA believes that a 50-year default postinjection site care timeframe, as required at §146.93(b)(1), is not overly burdensome, does not exaggerate the risks associated with GS, is consistent with other environmental programs, and sufficiently protects USDWs from endangerment. EPA adds that the purpose of the GS rule is not to incentivize the use of GS; rather, the purpose of the GS rule is to ensure that, where GS is deployed, it is conducted in a manner that protects

5USDWs from endangerment.

Letter ID: 0169 Comment ID: 23369 Letter Lines: 133 to 139
Comment Code: 5400 2.9 Proposed Financial Respons ibility and Long-Term Care Requirements
Comment: Financial Responsibility -- Pg. 42 APPA supports EPA’s suggesti on to issue guidance in the future for clarification of the financial responsibili ty mechanisms available for Owners or Operators of CO2 GS wells, provided that such guidan ce is issued in accordance with OMB’s Good Guidance Manual and that the final ru le accommodate a range of options, including self-insur ance instruments. Individual Response: EPA is developing guidance on financ ial responsibility for GS wells. EPA plans to take OMB's Good Guidance Manual in to advisement as financial responsibility guidance is developed. OMB's Good Guidance Manua l establishes policies and procedures for the development, issuance, and use of signi ficant guidance documents by Executive Branch departments and agencies. EPA is developing guidance that de scribes the types of financial instruments, which owners or operators can use to meet financial responsib ility requirements for GS wells. The financial responsibility guidance will include considerations for Directors regarding how to evaluate the appropriateness of a specific financial responsibi lity instrument for a specific project. EPA notes that directors may disallow certain instruments. See the final rule and preamble for further discussion of EPA's final approach to financial responsibility.

Letter ID: 0169 Comment ID: 23370 Letter Lines: 141 to 144
Comment Code: 5500 2.1 Comments on Involving the Public in Permitting Decisions
Comment: Public Participation -- Pg. 44 APPA agrees that public participation is crucial to the succes s of any individual CO2 GS project and of the UIC Program as a whole. Individual Response: The Agency believes that public particip ation is an important part of the UIC permitting process and wants to ensure wi de access to decision-making processes and information on projects. GS permitting authorities must follow the existing public participation requirements for UIC permits as specified in 40 CFR Part 124. These regulations lay out the procedures for decision making and include requirements such as re quiring the Director to notify the public regarding the availabil ity of the draft permit and allow him or her to request a public hearing on the draft permit. EPA encourages operators and permitting agencies to begin

6involving the public by providing info rmation as early in the pro cess as possible. Encouraging public participation allows the permitting authority to underst and public viewpoints, preferences, and concerns about the project, which might he lp avoid public misperceptions about the nature and safety of GS projects and forestall resistance later in the permitting effort.

Letter ID: 0169 Comment ID: 23371 Letter Lines: 146 to 151
Comment Code: 1800 1.4 Scientific Background/Informing the Proposal
Comment: The need for better data for GS to work -- Pg. 44 In non-oil and gas states (or perhaps some mining states ) there is little known about the subsurface geology. APPA believe s that USGS and other agencies can help the EPA and state agency dir ectors in better char acterizing these formations. Individual Response: While developing the GS regulati on, EPA evaluated relevant GS research, including projects conducted by the seve n regional carbon seques tration partnerships funded by the U.S. Department of Energy (DOE ) and coordinated through the National Energy Technology Laboratory (NETL), and se veral international projects. Additionally, EPA's Office of Water continues to fund research at the Lawrence Berkeley National Laboratory examining the effects of CO2 interaction on ground water a quifers and any potential mobilization of trace elements that may occur. EPA is communicating with other research or ganizations and academic institutions including, among others, Princet on University, Massachusetts Institute of Technology, and Montana State University, wher e specific research on geologic sequestration, injection well materials, and CO2 monitoring tech niques is in progress. EPA is also working with DOE, USGS, and others to identify tools and training techniques th at will provide GS permitting assistance and technical expertise as appropriate. Additionally, EPA's Office of Research and Development (ORD) is undertaking multiple research efforts on GS. Topics of research include bolstering di fferent default thermodynamic databases to include more comprehensive information on aqueous complexes and solid-phases that contain carbonate/bicarbonate and toxic elements for which EPA has a listed maximum contaminant level (MCL) for safe drinking water.
ORD's National Center for Environmental Resear ch (NCER) awarded six Science To Achieve Results (STAR) grants in the Fall of 2009 to re cipients from major universities and institutions within the scope of the "Integrated Design, Modeling and Mon itoring of Geologic Sequestration of Anthropogenic Carbon Dioxide to Safeguard S ources of Drinking Water" research area. These projects, which started in late 2009, include thes e lead institutions with specific topics of investigation: Clemson Universi ty will study potential impacts to drinking water aquifers of CO2-rich dissolved brines; the University of Illinois-Urbana will conduc t research related to reducing hydrologic and geochemical uncertainties associated with CO2 sequestration in deep, saline reservoirs; the University of Texas at Austin will assess appropriate monitoring approaches at geologic sequestration sites; the University of Utah will integrate design, monitoring, and modeling of GS to assist in developing a practical methodology for characterizing risks to USDWs; Columbia University will conduct laboratory experiments on

7shallow aquifer systems to improve understanding of geochemical and micr obiological reactions under low pH/high CO2 stress; and Princeton Univ ersity will develop a set of computational tools to model CO2 and brine movement associated with GS. In response to the comment regarding the amount of data available on the subsurface geology of states that do not produce oil or gas, EPA cl arifies that the permitti ng requirements at §146.82 require an extensive evaluation of the geologic c onditions at a proposed GS site to demonstrate the suitability of a potential project site for GS. If adequate maps and cross sections do not exist to support a thorough evaluation of the site, the owner or operator must produce the information (e.g., through additional, new studies) and the Dir ector has the authority to request additional information. See §146.82(a)(21). EPA is using an adaptive approach to re gulating GS under the UIC Program. Even after finalization of the GS regulation, the Agency plan s to collect and review data every six years on GS projects to determine whether the appropr iate amount and types of information and appropriate documentation are being collected, and to determine if modifications to the requirements are approp riate or necessary.

Letter ID: 0169 Comment ID: 23372 Letter Lines: 153 to 156
Comment Code: 5800 2.13 Comments on emergency and re medial response (40 CFR 146.94)
Comment: Leaks and response plans -- Pg. 46 APPA believes that the owner/operator must take remedial action as described in the permit’s response plan. Individual Response: EPA agrees that an emergency and reme dial response plan is an important part of assuring protection of USDWs from endangerment at GS sites. The requirements for an emergency and remedial response plan at §146.94(a ) are designed to ensure that owners or operators, as part of their permit applications , comprehensively plan what actions would be necessary in the unlikely event of an emergency. Th e plan will ensure that operators know what entities and individuals must be notified and what actions must be taken to expeditiously mitigate any emergency situations.

Letter ID: 0169 Comment ID: 23373 Letter Lines: 158 to 161
Comment Code: 4600 2.6 Proposed Plume and Pressure Front Monitoring Requirements (40 CFR 146.90)
Comment: Monitoring -- Pg. 46
APPA believes it makes common sense to place monitors close enough to detect the leak before it can ne gatively affect the USDW.

8Individual Response: Regarding monitoring locations, se ction §146.90(d) requ ires periodic monitoring of the ground water qua lity and geochemical changes above the confining zone(s). EPA clarifies that this monitoring requirement does not include the confining layer itself. Monitoring above the confining layer will provide an indication of upward movement of CO2 that might endanger a USDW. In addition, the fi nal GS regulation, at §14 6.90(g)(1), requires all GS project owners or operators to monitor for pr essure changes in the in jection zone. Monitoring of pressure in the injection zone gives even greater advance warning of fluid movement that could potentially affect impact USDWs. The exact number and location of monitoring locations to be tested will, however, be based on site-s pecific characteristics and vulnerabilities and described in the Director-approve d testing and monitoring plan. The GS rule stipulates that the monitoring fre quency and spatial distribu tion of monitoring wells must be based on baseline geochemical data th at were collected during the initial site characterization and the area of review eval uation, at §146.90(d)(2). The details of the geochemical monitoring will be based on site-speci fic information and described in the Directorapproved testing and monitoring plan. EPA is developing guidance on testing and mon itoring to assist owne rs or operators and Directors in evaluating requi rements under §146.90, including pr oposed monitoring plans. The guidance describes available technologies a nd recommended approaches for implementing a testing and monitoring plan, including pre-ope rational geophysical l ogging and testing of injection wells, MITs, injecti on well testing during operation, groundwater quality monitoring, tracking the CO2 plume and pressure front, a nd soil gas and surface air monitoring, which may be required by the UIC Director for specific GS projects. Th e guidance can be found on EPA’s website at http://water.epa.gov/type/gr oundwater/uic/wells_se questration.cfm.

Letter ID: 0169 Comment ID: 23374 Letter Lines: 163 to 168
Comment Code: 1300 1.1.2.3 Comments on other aspects of CCS (capture, transport)
Comment: Electric Reliability -- Pg. 47 APPA believes that potential impacts to elect ric reliability should be considered in promulgating the UIC Class VI permitting program rules. NERC’s study can be found at: http://www.nerc.com/files/2008-Clim ate-Initiatives-Report.pdf Individual Response: The UIC program’s authority under the SDWA focuses on ensuring that Class VI GS projects are permitted, sited, constructed, operated, monitored, and closed in a manner that protects USDWs from endangerment. Regulation of electricity providers is outside the scope of the Class VI GS rulemaking.

Letter ID: 0169 Comment ID: 23375 Letter Lines: 237 to 245
Comment Code: 1330 1.1.3.1 Support use of GS in general

9Comment: 3. APPA wants geologic sequestration of CO2 to work. Geologic Sequestration might enable the power utility sector to use coal at future and existing power plants while reducing CO2 emissions. Howe ver, the technology is not yet fully commercially demonstrated and suitable geology may not be available in all states. This caution does not discourage us from wanting it to work or for supporting additional demonstration projec ts at DOE/NETL and in the private sector. Geosequestration opportunities in oil and gas states are probably the most optimal location for early adopters of CCS technology(s). APPA encourages the use of oil and gas fields for injection of CO2 from power plants. Individual Response: EPA clarifies that the intent of the Class VI regulation is not to promote or encourage the use of GS, but to ensure protection of USDWs where GS technologies are deployed. Please see the remainder of EPA’s respons es to this comment for further details. For additional information on EPA’s fi nal regulatory approach, please see the final rule and preamble as well as the rulemaking docket.

Letter ID: 0169 Comment ID: 23376 Letter Lines: 247 to 251 ; 1314 to 1315
Comment Code: 1200 1.1 General comments about the rulemaking
Comment: 4. APPA strongly encourages the EPA to recognize the inextricable link between energy and water use. Water demand for power production remains intense, and may grow concurrently with demand growth a nd population growth. APPA recommends the Desalination and Water Purification T echnology Roadmap developed by Sandia National Labs in 2003 as a summary of the water-energy issues. [FN2] [FN2] This document can be downloaded at http://www.sandia.gov/water/des al/docs/DesalRdmap04a.pdf Individual Response: EPA clarifies that the linkage of wate r and energy issues is outside the scope of the GS rulemaking; th e purpose of the GS regulation is to ensure consistency in permitting underground injection of CO2 at GS operations across the United States and provide requirements to prevent endangerment of USDWs in anticipation of the eventual use of GS to reduce CO2 emissions.

Letter ID: 0169 Comment ID: 23377 Letter Lines: 253 to 274 ; 1317 to 1318
Comment Code: 1320 1.1.3 General comments about GS
Comment: 5. APPA believes that new power plants designed for geologic sequestration should be planned for sequestration to be conducted for the "life of the plant"- which can be as long as 60 years. However, APPA believes that if some type of lateral or vertical migration of the CO2 or other substances (such as brine, metals, drilling muds, cement from well failu re) is detected and believed to be

10potentially harmful to the underground s ources of drinking wa ter (USDW), that the power plant or power plants supply ing the CO2 to the injection site(s) should be given an "infeasibility exemp tion[FN3]" for sequest ration of its CO2. This exemption should enable the power pl ant to continue to operate without carbon dioxide injection in th at location. Without this "infeasibility" or "back out" clause for geosequestration, it is highly unlikely that communities would build power generating facilities with car bon capture and injection systems that could cost at least $2 billion dollars (2008 dollars) or be able to obtain financing if the plant was not expected to operate for the full 50-60 years. The financial risks for closure of a power generating plant or multiple plants in a region would simply be too enormous. APPA does not believe that anyone should presume that the CO2 from power plants to be injected into in situ or distant geology should be presumed to exceed 50% of the total CO2 in the first few decade of the commercial deployment. APPA has no notion that the future fossil power plants with CCS will be carbon neutra l given the larger volume of coal to be consumed in the gasification process in order to make up for parasitic power losses. [FN3] For the first generation plants, the "infeasibility exemption" should extend beyond infeasibility of the carbon capture operations of the power plant. Individual Response: EPA clarifies that regula ting power plants is outside the scope of the UIC GS rulemaking, and that GS rule does not require a ny facilities to capture and/or sequester CO2.
EPA also clarifies that the intent of the Class VI regulations is not to promote or encourage the use of GS, but, instead to ensure protection of USDWs where GS tec hnologies are deployed.

Letter ID: 0169 Comment ID: 23378 Letter Lines: 276 to 280
Comment Code: 2020 1.5.1 Support Class VI designation
Comment: 6. APPA enthusiastically supports a UIC Class VI permit classification despite our questions about feasibility and comme rcial deployment of the technology in 2008. Development of a permitting system soon is necessary to provide regulatory certainty to the first generation demonstration projects that are essential before the commercial developm ent of larger scale plants. Individual Response: As described above, EPA acknowledge s the comment and agrees that tailored requirements for Class VI wells are nece ssary to address the unique nature of injecting large volumes of CO2 and to ensure that USDWs are protected from endangerment.

Letter ID: 0169 Comment ID: 23379 Letter Lines: 282 to 288
Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment) Comment Code: 1640 1.3.4 CERCLA issues (seeking comment)

11Comment: 7. Congress must address a number of criti cal liability issues under CERCLA and RCRA to enable widespread commercial deploy ment of geosequestration of CO2 from power plants. That issue primarily is out side the scope of this rulemaking but must be acknowledged. Unless these issues are resolved, first generation plants cannot progress. As EPA recognized in its ANPR on CO2, this UIC rulemaking provides one opportunity to address these issues, while protecting the public health and welfare under the Safe Drinking Water Act. Individual Response: EPA agrees that overlapping regula tory schemes are undesirable. EPA received many comments regarding the applicability of the RCRA regulations and statute to CO2 streams that are geologically se questered under the final Class VI UIC well requirements. As a result, EPA has decided to initia te a separate proposed rulemaki ng specifically to examine the issue of RCRA applicability to CO2 streams being geologically sequestered, including the possible option of a conditional exemption from the RCRA requirements for CO2 GS in Class VI wells. EPA will consider these comments as pa rt of its development of that proposal. The Agency will consider issues particular to RCRA in the context of that separate rulemaking, and recommends that the commenter read that propose d rule when it is published. The Agency notes that commenters who wish to submit comments on the RCRA proposal will need to do so during the comment period for that rule. Finally, EPA also notes that the final GS rule, which adds new regulations for Class VI wells under the Safe Drinking Water Act (SDWA), is not making any changes to the RCRA regulations.
CO2 itself is not listed as a hazardous substan ce under CERCLA; however, the CO2 stream may contain a listed hazardous substance (such as mercury) or may mobilize substances in the subsurface that could react with ground water to produce listed hazardous substances (such as sulfuric acid). Whether such substances may result in CERCLA liability from a sequestration facility depends entirely on th e composition of the specific CO2 stream and the environmental media in which it is stored (e.g., soil or gr ound water). CERCLA exempts from liability, under CERCLA section 107, 42 U.S.C. 9607, certain “feder ally permitted releases” (FPR) as defined in CERCLA, 42 U.S.C. 9601(10). Class VI permits will need to be carefully structured to ensure that they prevent potential releases from the we ll which are outside the scope of the Class VI permit.

Letter ID: 0169 Comment ID: 23380 Letter Lines: 290 to 294
Comment Code: 1600 1.3 Risk Associated with CO2 GS
Comment: 8. "Acts of God" such as CO2 or other s ubstances released from seismic events where seismic events could not have b een reasonably anticipated by experts should not have liability attached to the owner/operator or other parties if the parties acted in a responsible way and c ould not have reasonably anticipated a fault or seismic risk. Individual Response: Under the final GS rule, once an owne r or operator has met all regulatory requirements under Part 146 for Class VI wells and the Director has approved site closure

12pursuant to requirements at §146.93, the owner or opera tor will generally no longer be subject to enforcement for regulatory noncompliance. Furtherm ore, their financial instrument as required under §146.85 will be released if it was not used. However, even if a site closure is approved under §146.93, an owner or operator may be held liable for regulatory noncompliance (including violation of 40 CFR 144.12) in ce rtain circumstances. For example, an owner or operator may be held liable for regulatory noncompliance even afte r site closure was approved if the Director relied on erroneous information (e.g., erroneous modeling data) provid ed by the owner or operator when approving site closure. Separate from EPA’s authority to enforce regul atory compliance, an owner or operator may be subject to a §1431 response orde r even after proper site cl osure is approved under §146.93. Under §1431 the Administrator may require an ow ner or operator to take necessary response measures if he or she receives information that a contaminant is present or is likely to enter a public water system or an USDW, which may pres ent an imminent and s ubstantial endangerment to the health of persons, and the appropriate Stat e and local authorities ha ve not acted to protect the health of such persons. Th e action may include issuing admi nistrative orders or commencing a civil action for appropriate relief against the ow ner or operator of a Class VI well. If the owner or operator fails to comply with the order, they may be subject to a civil penalty for each day in which such violation occurs or failure to comply continues. Furthermore, after site closure an owner or ope rator may remain liable under tort and other remedies, or under other federal statutes includi ng, but not limited to, Clean Air Act, 42 U.S.C. §§ 7401-7671; CERCLA, 42 U.S.C. § 9601-9675; and RCRA, 42 U.S.C. § 6901-6992. EPA does not have authority to transfer SDWA or other legal liability for Class VI wells to the State or federal government or a third-party fund. See the final rule preamble for further discussion of EPA's final approach. EPA adds that the GS rule contains several pe rmit requirements (i.e., related to proper siting and operation of the well) to address seismic risk th at should mitigate the chances of such events.

Letter ID: 0169 Comment ID: 23381 Letter Lines: 296 to 304
Comment Code: 1800 1.4 Scientific Background/Informing the Proposal
Comment: 9. State governments, the EPA, power plan t owner/operators, wa ter utilities and the public need more data on water and subsurface geology/hydrology before we can actually begin wide scale deployment of new CCS plants. APPA strongly encourages EPA, DOE/NETL, U.S. Ge ological Survey (USGS) and state geologists/hydrologists to work together to improve our knowledge on both surface and subsurface geology. APPA believes it will be helpful for Congress to better understand the technology and to fully fund demonstration projects so that there is sufficient understandi ng of geology to support widespread geosequestration. Individual Response: As described in the previous re sponse, EPA is tracking continuing

13research on CCS conducted by other federal agenci es. EPA clarifies that Congressional actions and budget issues are outside the scope of the GS rulemaking.

Letter ID: 0169 Comment ID: 23382 Letter Lines: 318 to 334
Comment Code: 1330 1.1.3.1 Support use of GS in general Comment Code: 1610 1.3.1 Risks to USDWs
Comment: Geologic sequestration into all geologic formations must be considered by electric utilities in their long-term pl ans for future fossil-fuel electricity generation while also weighing the need to protect public drinking water supplies. Protection of drinking water supplies, for some communities, may mean that inadequate surface water supplies ma y require that the city (or private utility) may require usage of groundwater in future year s which may not appear to be "drinkable" under toda y’s presumed costs and tec hnological (pump and treat or desalination) limitations. Our collea gues in the municipal drinking water operations remind us that Americans are currently drinking wa ter which, in many locations, was undrinkable only 5-10 years ago. While most American cities in the east provide drinking water made up largely of surface water, more than 90% of all drinking water systems (priva te and public) use some amount of groundwater to make up for shortages. Ac knowledging this does not mean that geosequestration should not be allowed. It simply requ ires common sense decision making at the local and regional level by power plants and the state directors as to the best placement of geosequest ration plants or off-site injection formations. Individual Response: The Agency acknowledges commenter concerns about water resources and future water resource availability. The pr imary goal of the UIC Program under the SDWA is to protect USDWs from endangerment in order to ensure a reliable supply of drinking water for the American public. The GS rule, as part of the UIC program regulations, continues the program’s mandate and mission of ensuring the protection of USDWs. EPA expects the tailored permitting, siting, construction, operation, monitoring, and post-injection site care requirements in the GS rule to prevent leakage from injection formations and protect USDWs.

Letter ID: 0169 Comment ID: 23383 Letter Lines: 336 to 340
Comment Code: 1910 1.4.4 Stakeholder outreach
Comment: We thank EPA for the regional workshops and public hearings associ ated with this proposed rule, the willingness of staff to meet with our electric (and water) utility representatives, and for the ope nness in the meetings about the tough issues inherently involved with drinking water protecti on with an entirely new technology (given the scale) fo r the power plants sector. Individual Response: EPA acknowledges the comment and agrees that input of and

14participation by a wide spectrum of stakeholders is a vital component of successful rulemaking. The Agency appreciates the degr ee of cooperation, participation, and active dialogue between the EPA and stakeholders and will continue to work with stakeholders and experts as it implements the GS rule.

Letter ID: 0169 Comment ID: 23384 Letter Lines: 342 to 379
Comment Code: 1320 1.1.3 General comments about GS
Comment: The EPA’s proposed rule asks for comment on many issues which are new to the power sector. EPA does its best to tease out what we know from the use of CO2 injection/recycling from the oil and gas s ector and try to apply some of these concepts to the future power sector part ies who might need to build coal-fired electric generating plants but would be required to reduce emissions of carbon dioxide through the combinati on of carbon capture technology at the plant and GS at an injection site. Carbon sequestration can empl oy any of several physical, chemical, or biological processes to isolate CO2 from the atmo sphere, on a long-term basis. Carbon sequestration can be terrestrial and geol ogical. As part of the Earth’s carbon cycle, terrestrial sequestra tion uses vegetation and th e soil as carbon sinks. There are both technical and non-technical challenge s to sequester large quantities of CO2 in subsurface reposito ries. The technical challenges are exacerbated by a lack of expe rience with processes on an appropriate scale, or in geologic formations that have no hi story of oil and gas production. The nontechnical challenges - in the form of legal and regulatory issues - are as significant as the technical uncertainties. But APPA supports research in order to assist us to make these changes. The amount of CO2 that could be required to be sequestered is enormous. The generation of power by coal-fired power pl ants in the U.S. produces 1.5 billion tons of CO2 that, when compressed to supercritical conditions, comprises a volume that exceeds that equal to U.S. o il consumption. The task of transporting and managing this volume of material is complicated by the need to operate the transport in a pipeline at 2,000 psig to ma intain CO2 in a fluid state in these specialty pipelines. APPA does not question th e viability of the tech nology of carbon dioxide injection for enhanced oil and gas re covery in production fields. Any questioning about the technology in the contex t of these APPA comments pertains to new large scale power plant parties which would likely be built outside the geologic formations suitable for oil and gas recovery. While the proposed rule asked for comments on the impacts on other i ndustries, these APPA comments focus on power plants. We don't offer comments on carbon separation and injection/storage for ethanol plants, chemi cal companies, cement factories, or coal bed methane plants that might have similar opportunitie s to inject CO2.

15APPA has no comments on more shallow me thane recovery from coal operations. Individual Response: EPA acknowledges the comment. Pleas e see the remainder of EPA’s responses to this comment for further deta ils. For additional information on EPA’s final regulatory approach, please see the final rule an d preamble as well as the rulemaking docket. As described above, the GS rule does not require an y facilities to capture and/or sequester CO2.

Letter ID: 0169 Comment ID: 23385 Letter Lines: 381 to 390
Comment Code: 1610 1.3.1 Risks to USDWs Comment Code: 1850 1.4.2 CO2 GS Field Research
Comment: APPA strongly supports private a nd DOE/NETL geologic sequestration demonstration projects to tell us more about the te chnical viability of the separation technology and the scaling up of geologic sequestration. Further, these projects must also support any geosequestration or GS research projects that would better enable us to know more about the USDWs a nd protection of that critical resource. The "location is everything" is a criti cal presumption for the reader of our comments on the proposed UIC rule. In some locations geosequestration will be an optimal technology that makes sense for t hose future coal plants. In other locations, the type of rock, the lack of trapping mechanisms or proximity to underground faults, seis mic risks or other Individual Response: As described above, EPA is track ing continuing research on CCS conducted by other federal agencies. EPA agrees that further research will assist with the transition to commercial-scale GS. As part of its adaptive rulemaking approach, The Agency plans, every six years, to collect and review data on GS projects to determine whether the appropriate amount and types of information and appropriate documentation are being collected, and to determine if modifications to the requirements are appropriate or necessary. While developing the GS regulation, EPA evaluate d relevant GS research , including projects conducted by the seven Regional Carbon Seque stration Partnerships funded by DOE and coordinated through the Nati onal Energy Technology Laboratory (NETL), and several international projects. EPA published a Notice of Data Availability and Request for Comment (NODA) on August 31, 2009 (74 FR 44802), in which the Agency presented the results of research at three DOE partnership sites (in Es catawpa, Mississippi; the Aneth Field in Paradox Basin, southeast Utah; and the Pu mp Canyon Site, New Mexico). In the NODA and Request for Comment, EPA de scribed two modeling st udies by the Lawrence Berkeley National Laboratory on the potential effects of CO2 injec tion on ground water and surrounding formations to determine the potentia l for impacts on USDWs and human health in the event that a GS project is not properly s ited, operated, or managed. In one study, LBNL used a comprehensive computational model to evaluate the potential impact of CO2 leaking from

16deep GS sites on the concentrations of trace el ements in USDWs (Birkholzer et al., 2008a). In the other, LBNL studied a hypothetical, future scenario of GS in a sedimentary basin to demonstrate the potential for basi n-scale hydrologic imp acts of CO2 storage (Birkholzer et al., 2008b). EPA has also examined potential methods for conducting treatment of water affected by a CO2 leak; this study is presented in the final rulemaking docket. EPA continues to fund research in this area. In December 2009, EPA awarded a STAR grant to Clemson University to investigate the potential for GS to affect USDWs. The research will involve laboratory experiments and modeling simulations to inve stigate the fate of dissolved CO2 in underground geologic formations and to de termine possible risks associated with the dissolution of CO2 in undergr ound aquifers. Other projects funde d by the STAR grants include: the University of Illinois-Urbana will conduc t research related to reducing hydrologic and geochemical uncertainties associated with CO2 sequestration in deep, saline reservoirs; the University of Texas at Austin will assess a ppropriate monitoring approaches at geologic sequestration sites; the University of Utah w ill integrate design, monitoring, and modeling of GS to assist in developing a pract ical methodology for characterizing risks to USDWs; Columbia University will conduct laboratory experiments on shallow aquifer systems to improve our understanding of geochemical and microbiological reactions under low ph/ high CO2 stress; and Princeton University will develop a set of computational tools to model CO2 and brine movement associated with GS.

Letter ID: 0169 Comment ID: 23386 Letter Lines: 392 to 402
Comment Code: 1320 1.1.3 General comments about GS
Comment: Our comments pertain to large scale power plant applications and those much larger CO2 injections and storage in geologic formations. There may be opportunities in the early years for th e placement of coal plants for geosequestration in the shadow of the o il and gas industry where there would be opportunities for EOR/EGR. APPA encourages this and believes that this may be beneficial to many parties-including the power sector. If all new coal power plants could be built over geologic formations that have oil and gas recovery operations or where the CO2 could be stor ed in depleted wells, the economics would be far more favorable for the power s ector. However, even if that were the case, the drinking water prot ection issues do suggest so me initial caution in site selection. Individual Response: EPA acknowledges the comment. As de scribed above, the GS rule does not require any facilities to cap ture and/or sequester CO2. Plea se see the remainder of EPA’s responses to this commen t for further details.

Letter ID: 0169 Comment ID: 23387 Letter Lines: 404 to 425
Comment Code: 1330 1.1.3.1 Support use of GS in general Comment Code: 1610 1.3.1 Risks to USDWs

17Comment Code: 1800 1.4 Scientific Background/Informing the Proposal
Comment: Our comments here should not deny the viability of CCS in some subsurface locations nor be read as A PPA’s view that geologic sequestration works in all geologic locations or for all power plants. There is a great deal that we do not yet know about the wide variety of geologi c formations to know that there are no risks to USDWs or that we could identify specifically what t hose risks might be. APPA hopes that on-going private and pub lic research in the United States, Canada, Australia, and Europe will affirm that there are no risks to drinking water supplies or that the risks are so tr uly negligible that there is no reason to hesitate to use this technology. But we cannot presume that there are no risks simply based upon the commercial and technical success in CO2 recycling in Class II injection locations that are managed as producti on fields. It has been presumed that because the CO2 injections began in the Permian Basin of West Texas in the late 1970s that the CO2 from those tertiary recovery fields (for oil or gas) is actually s till in the formation. In most cases the CO2 was recycled and used in different producti on operations. Even if the CO2 was injected 25-35 years ago, the CO2 may not still reside or remain in storage there. Because we have not seen large st orage fields where the CO2 was stored for 10-30 years on a sustained basis, ther e is not as much known about the geologic formations, the adequacy of hol ding capacity and subsurface impacts as we would like to know. Also, in many cases , those oil or gas production fields are regulated differently than a newly es tablished long-term GS formation would be regulated if it were owne d/operated by a power company. Individual Response: EPA agrees with the commenter that th e risks involved in GS projects are different than the risks associated with Class II activities. EPA believes that GS is sufficiently distinct from Class II ER operations to warrant the tailored requirements in the GS regulation. For example, the volume of CO2 anticipated to be injected in Class VI wells is significantly greater than for Class II wells. Reservoir pressu re conditions will be different, with Class VI injection operations involving large volumes of CO2 and likely having hi gher pressures within their storage formations than Class II ER project s. Therefore, Class VI GS reservoir pressures will increase more in comparison to Class II ER during the injection phase of the GS project.
EPA continues to research and collect data on CO2 storage and containment. EPA is tracking operations at the DOE GS pilot projects and will review data on all aspects of those operations, from well construction and injection to long-term plume fate and transport and monitoring of containment, as the data become available. In ad dition to the information cited in the preamble to the proposed rule, EPA published a Notice of Da ta Availability and Request for Comment on August 31, 2009 (74 FR 44802), in which the Agency de scribed the results of research at three DOE partnership sites: the Escatawpa, Mississi ppi project; the Aneth Fi eld project in Paradox Basin, Southeast Utah; and the Pump Canyon Site, New Mexico. Please also see the research described in the above response. As part of its adaptive rulemaking approach, the Agency plans, every six years, to collect and review data on GS projects to determine wh ether the appropriate amount and types of

18information and appropriate documentation are being collected, and to determine if modifications to the requirements are appropriate or necessary.

Letter ID: 0169 Comment ID: 23388 Letter Lines: 427 to 431
Comment Code: 2020 1.5.1 Support Class VI designation
Comment: But, APPA does believe that the CCS plants that will be proven viable deserve a permitting mechanism under the EPA’s propos ed Class VI program. APPA has no hesitation about a Class VI permitting system . APPA encourages the U.S. EPA to finalize this new category as soon as po ssible to facilitate the permitting and construction of first generation U.S. demonstration projects. Individual Response: As described above, EPA agrees that tailored requirements for Class VI wells are necessary to address the unique nature of injecting larg e volumes of CO2 and to ensure that USDWs are protected from endangerment.

Letter ID: 0169 Comment ID: 23389 Letter Lines: 433 to 453
Comment Code: 1330 1.1.3.1 Support use of GS in general Comment Code: 1540 1.2.3.2 Climate change legislation
Comment: Some personnel at the U.S. EP A and members of Congress often assume falsely that CCS or GS is commercially deployable now in all states based upon the success in the half dozen or perhaps as many as a dozen oil/gas production states. The development of a national viable and wo rkable CO2 capture and sequestration permitting program is one of the key prerequisites to the implementation of contemplated energy reform initiatives-ranging from state laws that force reductions in CO2 to pending new Federal legislation to require a national cap (on CO2 emissions.) APPA’s comments are offered here on the UIC permitting system are valid regardless to whatever "carbon signal" there might be to reduce CO2 from power plants. Even if there is no new national law setting a carbon emissions limit, intensity limit, carbon tax, or new generation requirement, states also have the ability to set state by state limits on 16 carbon dioxide emissions from power plants under separa te state CO2 laws. APPA does not like patchwork quilt state by state regulatory approaches to reduce CO2 through different laws and regulations. It is entirely too soon to know what Congress might do. At this time, we have no clue what Congress might do in the future to constrain CO2 that would motivate any part y to reduce CO2 from coal or natural gas plants. APPA’s comments ar e neutral as to the new legislative mechanism that would "constrain carbon". Thes e technical, logistical, or cost issues are valid regardless of why utilities would want to inject CO2 under any carbon dioxide mitigation standard, reduction policy, or law. Individual Response: EPA acknowledges that GS falls within the broader context of CCS and

19the need for regulatory clarity to ensure that USDWs are protected from endangerment. In developing the final GS rule, the Office of Water coordinated with other Agency program offices and across federal agencies (e.g., with the Depart ment of Energy; United States Geological Survey; Bureau of Ocean Energy Management, Regulation, and Enforcement, formerly the Minerals Management Service; Bureau of Land Ma nagement). The Agency continues to evaluate areas of potential applicability of other Federa l environmental statutes including, but not limited to: the Clean Air Act; the Resource Conserva tion and Recovery Act; the Comprehensive Environmental Response, Compensation, and Liabili ty Act; and the Marine Protection, Research and Sanctuaries Act to various aspects of GS a nd CCS. The Agency will continue to coordinate on GS and CCS related issues to minimize redunda ncy and maximize efficiencies for owners or operators. For additional information, please s ee the discussion entitled "How Does This Rulemaking Relate to Other Federal Authorities and GS and CCS Activities?" in the preamble to the final GS rule.
EPA is also aware that states ar e currently in various stages of developing statut ory frameworks, regulations, technical guidance, and strategies for addressi ng CCS and GS. States can use multiple authorities beyond those afforded under the SDWA and UIC regulations, including laws and policies addressing surface access and land rights, unitization of fields, pore space ownership, mineral rights, worker safety and em ergency preparedness, a nd maximization of state oil and gas resource exploitation. EPA plans to wo rk closely with states and tribes as they develop Class VI primacy programs in this broa der context. EPA adds that states may adopt more stringent standards for Class VI wells than the Federal requirements. In a separate rulemaking under authority of th e Clean Air Act, EPA is amending the Greenhouse Gas (GHG) Reporting Program at 40 CFR Part 98 to add reporti ng requirements for facilities that conduct GS (subpart RR) a nd all other facilities that in ject CO2 underground (subpart UU). For additional information, see the section of the final GS rule preamble entitled, "How Does Mandatory Reporting of Greenhouse Gases (GHGs) Relate to This Rulemaking?” and the GHG Reporting Program rulemaking and docket.

Letter ID: 0169 Comment ID: 23390 Letter Lines: 455 to 479
Comment Code: 1370 1.1.3.5 US storage capacity
Comment: EPA contemplates that the electric power sector "will most likely be the largest potential market for carbon capture and sequestration (CCS) technologies, with the potential to reduce CO2 by approximate ly 80-90% at an individual plant." EPA’s figure seems extremely optimistic a nd perhaps unrealistic given what we know about both current demonstration proj ects of carbon separa tion and geologic sequestration. We do not reco mmend that anyone assume th at 80-90% of CO2 from the power sector can actually be separate d and STORED or sequestered in all geologic formations given our current know ledge. While separation of CO2 from the other air emissions might be achievab le at 80-90%, presuming this number for geosequestration that EPA offers s eems overly rosy. See 73 Fed. Reg. 44354, 44492. The oil and gas sector does not univers ally store 80-90% of the CO2 that is recycled in its current EOR/EGR operati ons. In our review of descriptions of

20current EGR/EOR, as much as 95% of th e CO2 can be recycled many times and sometimes the remaining CO2 is ultimately vented to the atmosphere. Enhanced Oil Recovery Schematic Show ing CO2 recycling (source: American Geological Institute) [Please refer to p. 17 of the pdf file for Figure 1.] Separation and storage capacities may be very different at each geologic formation or subsurface location. APPA is not offering this as a criticism of oil/gas operations but simply explaining that there are many myths about actual retention of CO2 in oil/gas recovery operations and how translatable that experience is for the power plant sector. Regardless of the actu al future volume Individual Response: EPA acknowledges this comment. The purpos e of the Class VI GS rule is to ensure consistency in permitting underground injection of CO2 at GS operations across the United States and provide requirements to prev ent endangerment of USDWs in anticipation of the eventual use of GS to reduce CO2 emissions. In a separate rulemaking under authority of th e Clean Air Act, EPA is amending the Greenhouse Gas Reporting Program at 40 CFR Part 98 to ad d reporting requirements for CO2 injection and geologic sequestration. The greenhouse gas report ing requirements build on the requirements outlined in the Class VI GS rule with the a dditional goals of verifying the amount of CO2 sequestered and collecting data on any CO2 emissions to the surface from Class VI GS facilities.

Letter ID: 0169 Comment ID: 23391 Letter Lines: 479 to 486
Comment Code: 1260 1.1.1.5 More certainty/stringency is needed
Comment: experience is for the power plant sector. Regardless of the actu al future volume of injection (or perhaps the ultimately limited success of carbon separation and ultimate injection), a practical Class VI permitting system is essential. Given the direct impact this program will have on the electric utili ty industry, APPA genuinely appreciates EPA's goal of estab lishing a regulatory regime that will provide "certainty" and "transparency" to what requirements would apply to owners/operators who engage in Class VI CO2 injection. Id. at 43496 (July 25, 2008). At the same time, it is crucial for the regulations to reflect the Individual Response: EPA clarifies that the Class VI GS requirements are designed to ensure that, where deployed, GS is conducted in a ma nner that protects USDWs from endangerment. Encouraging investment in CCS projects and facilit ating deployment are out side the scope of the GS rulemaking.

Letter ID: 0169 Comment ID: 23392 Letter Lines: 486 to 504

21Comment Code: 1380 1.1.3.6 Deployment of GS
Comment: 2008). At the same time, it is crucial for the regulations to reflect the challenges inherent in crafting controls for commercial CO2 injection and storage activities when such large-scale commercial operations are only at the nascent stage. Given what we know now, AP PA remains rather sk eptical that the large scale operations as envisioned by the popular or trade press (and perhaps EPA’s proposed rule’s preamble) are very possible in the next few decades. DOE’s original estimate that this new commerci alized CCS industry is possible in about 40 years is probably more realistic. Of course, APPA hopes that there are technology breakthroughs and that CCS or GS can be viable on larger scales which also remain protective of USDWs within th e next 15 years. But we believe these larger commercial size power plants w ith > 10 tons of carbon sequestered annually would likely come online after 2025. We hold this hope on CCS in the same context as in hoping that there will be breakthroughs in large capacity battery storage or in storage for wind capacity or for new nanotechnology for solar panels. All are needed to achieve improvements in a power plants’ carbon footprint and in reducing cr iteria pollutants. While we may hope for technology and infrastructure breakthroughs, we pl an on geologic sequestration based upon cold reality. The last thing that APPA want s is to promise what we might not yet be able to deliver. Individual Response: EPA clarifies that the Class VI GS regulations promulgated under Safe Drinking Water Act authority do not promote or encourage the use of GS, but, ensure consistency in permitting underground injection of CO2 at GS operations across the United States and provide requirement s to prevent endangerment of USDWs in anticipation of the eventual use of GS to reduce CO2 emissions. EP A believes that the Clas s VI GS regulations, which build upon the long-standing, protective, re gulatory framework of the UIC program, will provide the regulatory certaint y and clarity that owners or operators have requested. EPA acknowledges that there are unknowns associat ed with early GS project deployment and the long term storage of CO2 for GS. For these reasons, the Agency is using an adaptive approach to regulating GS injection. The Agency will, every six years, collect and review data on GS projects to determine whether the appropriate amount and types of information and appropriate documentation are being collected, and to determ ine if modifications to the requirements are appropriate or necessary.

Letter ID: 0169 Comment ID: 23393 Letter Lines: 506 to 563 ; 1320 to 1323
Comment Code: 1300 1.1.2.3 Comments on other aspects of CCS (capture, transport)
Comment: One of the largest hurdles: Parasitic Power The fundamental challenge confronti ng the utility indus try is in carbon separation and in reducing the parasitic loss of energy at a power plant. Parasitic loss issues at power plants ar e best explained in Attachments 2 and 3

22by Doug Carter. [Please see EPA-HQ-OW- 2008-0390-0169.pdf for Attachments 2 and 3.] These two papers explain to both laym en and technical experts why parasitic energy could be one of severa l "deal killers" for new power plants with GS.[FN4] These parasitic are problems that are very fundamental and will determine whether power plants pursue this te chnology or opt for another type of generation such as nuclear power or perhap s natural gas (which has roughly half of the carbon dioxide as coal). See Fi gure 2 which highlights the processes which contribute to the parasitic power demands of CCS. Even if carbon separation technology is commercially demons trated at > 30 MW in the next few years, parasitic power or energy losses are a huge disincentive to use this new generation technology. [Please refer to the p. 19 of the pdf f ile for Figure 2 of Parasitic Power Losses in CCS Power Plant] The storage issues can be equally daun ting but the fundament al question of separation and parasitic power are so overwhelming that it is not entirely clear how many municipal governments will want to pursue this technology until those economic issues (especially the parasiti c power) are sorted out. The other remaining issue in the three legged footst ool is the question of infrastructure and logistics. Without a massive investme nt in infrastructure for additional pipelines and booster compressors, APPA wonders how many of these plants will be built in the first 10-30 years. The oil a nd gas industry had 35 years to build up the essential infrastructure for CO2 injection in the context of oil and gas recovery. This infrastructure includes pipelines, booster compressors and feedstock delivery. See Figure 3 for a map showing current CO2 pipelines in the U.S. [Please refer to p. 21 of the pdf f ile for Figure 3 of U.S. CCS Pipeline Map] The industry also has systems in place to remove/treat produced waters. These systems are not in place in states with no oil or gas production. Those oil and gas recovery fields were and ar e highly profitable and had a revenue stream to offset the investments in de livery methods such as construction of pipeline or adaptation of existing natu ral gas pipelines, booster compressors, or for the use of tankers for some small quantities of CO2 for use at production fields. The economics for power plants ar e not yet ripe for such investments because power plants would not have the additional revenue stream coming in for infrastructure investments coming off th e oil and gas production revenue stream Nor are the right of way or surface right issues sorted out by state law before CO2 can be either transported across ju risdictional lines or stored as a commodity without surface property rights bein g sorted out. These commercial and practical impediments to geologic sequestra tion (GS) are enorm ous and should not be minimized simply because we wish to find a technology that will work to enable us to use coal or natural gas in the future. These commercial, technology and feasibility impediments are not EPA’s problems to fix-but they are mentioned here because we are trying to inject "rea lity" into the zealous discussions in the trade press, on television, and at coal plant hearings a bout the viability

23of geologic sequestration at new coal plants in 2008. These same issues apply to the existing coal plant fleet. These same commercial issues apply in the context of natural gas generation sources where no carbon separation technology exists today without dramatic parasitic power impacts which would typically be too onerous for existing plants. [Figure 3. Please refer to p. 21 of the pdf file for Figure 3 of U.S. CCS Pipeline Map] [FN4] L.D. Carter, White Paper, "Carbon Capture and Storage From Coal-based Power Plants: A White Paper on Technol ogy for the American Public Power Association (APPA)," May 2007 and L.D. Cart er, White Paper, "Retrofitting Carbon Capture Systems on Existing Coal-fired Power Plants," November 2007 Individual Response: EPA emphasizes that the UIC program ’s authority under the SDWA is focused on ensuring that Class VI CO2 injection projects are permitted, sited, constructed, operated, monitored, and closed in a manner th at protects USDWs from endangerment. The capture and transport of CO2 are not within the UIC program’s authority.

Letter ID: 0169 Comment ID: 23394 Letter Lines: 565 to 577
Comment Code: 1250 1.1.1.4 Flexibility is needed (p erformance-based standards)
Comment: EPA, in this rulemaking, must establis h a cost-effective and environmentally sound regulatory program to cover a range of operations in order that the technology will be commercially deployed. To meet this challenge and establish a workable regulatory framework over the co ming decades for the long-term storage of CO2, it is imperative that EPA take care to craft the regulations with flexibility so that they may be fine-tun ed as industry and re gulators alike gain experience with the large-scale CO2 se questration contemplated by this rulemaking. APPA applauds EPA’s efforts to build such flexibility mechanisms into the Proposed Rule, in cluding the use of state di rectorial discretion and the provision for forthcoming guidance to clarify other requirements. APPA agrees that both of these methods will he lp create a regulatory framework that can evolve as information and technologica l advancements are gained in the field of carbon capture and sequestration. Individual Response: The Agency believes that the Class VI requirements balance site-specific flexibility with USDW protection. Rather than setting performance or technology-based standards for GS projects, EPA is adopting a flex ible approach, where operators of GS projects would develop and implement site-specific plans for delineating the AoR, testing and monitoring the site, performing corrective actio n, and post-injection site care . EPA believes that the plans— which would be reviewed and approved by the Director and periodical ly updated throughout the life of the project—promote an ongoing dialogue between the operato r and the Director that will encourage use of the most appropriate t echnologies for a particular project. EPA clarifies that the intent of the Class VI regu lations is not to promote or encourage the use of

24GS, but, instead to ensure protection of USDW s where GS technologies are deployed. EPA is using an adaptive approach to regulating GS unde r the UIC Program. Even after finalization of the GS regulation, EPA plans, every six years, to collect and review project data on GS research projects to determine whether the appropriate amount and types of information and appropriate documentation are being collected, and to determ ine if modifications to the requirements are appropriate or necessary.

Letter ID: 0169 Comment ID: 23395 Letter Lines: 579 to 587
Comment Code: 1200 1.1 General comments about the rulemaking Comment Code: 1435 1.2.1.3 EPA should develop guidance
Comment: EPA asked for comments on financial guidanc e on any aspect of the final rule (for example, clarification of requirement s for financial assurance mechanisms). APPA thinks that this might be an ar ea where the EPA might call for a "second bite at the apple" after we know more from the prel iminary carbon sequestration projects and "scaling up" projects. We agr ee with Utility Solid Waste Activities Group (USWAG) and others who have suggested that that guidance must be developed in accordance with OMB’s Good Guidance Pr actices Bulletin, which directs that notice and comment be provided for the development of "significant" and "economically significant" guidance documents. Individual Response: The GS rule contains minimum t echnical criteria for the permitting, geologic site characterization, AoR and corre ctive action, well construction, operation, mechanical integrity testing, monitoring, financ ial responsibility, inj ection well plugging, postinjection site care, and site closure of GS we lls, which will ensure that USDWs are protected from endangerment. To promote consistency while providing the Dire ctor with an appropria te level of discretion, EPA is developing guidances for states and tribes that describe the process of applying for and receiving primacy for GS Class VI wells under Section 1422 of SDWA, as well as the technical and administrative issues associat ed with developing GS regulations that are the equivalent of minimum federal criteria and requirements. These are available on EPA’s website at http://water.epa.gov/type/groundwat er/uic/wells_se questration.cfm.
EPA intends to take OMB’s Good Guidance Manual into consider ation as financial responsibility guidance is deve loped. OMB’s Good Guidance Ma nual establishes policies and procedures for the development, issuance, and use of significant guidance documents by Executive Branch departments and agencies. EPA agrees that an adaptive and flexible a pproach is appropriate. To protect USDWs from endangerment and meet the potentially fast pace of GS deployment, EPA is using an adaptive approach to regulating CO2 injection for GS. The Agency plans to, every six years, collect and review data on GS projects to determine wh ether the appropriate amount and types of information and appropriate documentation are being collected, and to determine if modifications to the requirements are appropriate or necessary. An adaptive approach will allow

25regulatory development to proceed in time to meet the current and future demands for Class VI permits while EPA continues to gather data from pilot projects and other research as it becomes available.

Letter ID: 0169 Comment ID: 23396 Letter Lines: 589 to 624 ; 1325 to 1330 ; 1332 to 1333 ; 1335 to 1336
Comment Code: 1260 1.1.1.5 More certainty/stringency is needed Comment Code: 1620 1.3.2 Induced seismicity
Comment: Because information and technology relate d to carbon sequestration are sure to develop as more experience is gained, APPA urges EPA to do what it can avoid the use of arbitrary or blanke t prohibitions or absolutes in the EPA final rule. However, APPA believes that there are some common sense prohibitions that may be justifiable. For example, EPA should have in the final rule an explanation, consistent with the Class I program, that seismic-induced subs urface conveyance risks such as major fau lts, or proximity to sole source aquifer [FN5] protections are essential. Sole source a quifers are not the same as deep saline aquifers. APPA believes there are some pr ohibitions that are key to protection of USDWs. At the same time we do not want to contribute to "NIMBY " or "not in my backyard" or "NUMBY" - or "not under my back yard". What APPA asks for in the context of seismicity issues are clear-cut and understanda ble parameters or USGS guidelines so that power plant owner/operators don't pursue a geologic formation thinking that it is eligible only to l earn that the EPA has used a USGS designation on seismic risks that would re nder it disqualified later in the permitting process. APPA asks that when the EPA or state directors make seismicity conditions that these be s ubject to notice and comment and be published in the Federal Register and the state equivalent pub lication. It would be terrible to have a power plant owner/operator spend time and significant money pursuing a geologic formation only to learn after he had spent many hundreds of thousands of dollars that the site did not meet the EPA’s seismic risk or USGS seismic requirements. Seismic ity risk avoidance is a new factor for thermal or fossil plants and not one w ith which we have experience. APPA includes in the Appendix a paper from an NETL-funded study on seismic activity induced by injection of CO2 into deep sa line aquifers [FN6] and an article regarding the Greek government’s concerns with injection of CO2 in the Mediterranean. [FN7] [S ee EPA-HQ-OW-2008-0390-0169.pdf for these documents.] Including these references to seismic issu es does not mean that APPA fears that CO2 will cause seismic activity. Instead APPA does not want to see APPA member utilities pursue geology which has underlyi ng seismic risks that are unknown to the power sector (and perhaps to the st ate agencies) and misuse critical resources, time and money pursuing that location for permitting only to find out later that they must start again. Most lo cations in the U.S. have not had recent seismic data assessed at th e "fine granular" level need ed to target the right formations for carbon dioxide geoseque stration. This will necessitate the support of United States Geologic Survey and other agencies.

26[FN5] A sole source aquifer (SSA) is an underground water supply designated by the U.S. EPA as the "sole or principal" source of drinking water for an area under Section 1424(e) the Safe Drinking Wa ter Act of 1974. "Sole or principal" has been interpreted to mean that the a quifer must supply at least 50 percent of the drinking water to persons living over the aquifer; there should be no alternate and feasible sources of drinki ng water that could replace the aquifer. [FN6] Issues Related to Seismic Activity I nduced by the Injection of CO2 in Deep Saline Aquifers, Joel Sminchak and Neeraj Gupta, Battelle Memorial Institute [FN7] "Why doesn't Greece like carbon captu re?" Leigh Phillips, EU Observer, 9/23/08, http://euobserver.com/19/26794 Individual Response: The GS rule, at §146.82(a)(5) requires pr ospective owners or operators to submit information on all USDWs within the Ao R. EPA expects that this information will include identification of any sole source aquifers . The GS rule also requires operators to submit extensive information about the s ite, including the geologic characteristics of the injection and confining zones, to demonstrate that the inject ed CO2 will remain within the target formation. The Director must consider this information when determining whether GS is acceptable at a given site. EPA expects that during this evaluation the Director will consider the potential impact of the GS project on an y sole source aquifers. Regarding seismicity, EPA acknowledges that induced seismicity is a risk that may be associated with GS but maintains that the risk is low (IPCC, 2005). Th e GS rule contains several requirements to address seismic risk. First, as part of the site characteriza tion process, owners or operators must submit information about the se ismic history of and seismic sources near a proposed GS site, data on known or suspected fa ults in the AoR, geomechanical information on fractures, stress, ductility, rock strength, and in si tu fluid pressures within the confining zone as specified in §146.82(a)(3). This information is evaluated by the Director, who determines the suitability of a potential project site for GS. Any sites with the poten tial for reopening or reactivation of faults or un acceptable seismic risk that co uld otherwise interfere with containment will not be permitted as GS sites. Duri ng injection, the pressure in the injection zone must not exceed 90 percent of the fracture pre ssure of the injection zone as specified in §146.88(a); this requirement is inte nded to prevent the opening of fractures or faults through over pressurization of the injection zone.
EPA clarifies that the rule doe s not contain any specific require ments describing "seismically appropriate" areas, and does not believe this is appropriate for all sites. EPA believes such determinations should be made on a site-specific ba sis. If such information is available, and the Director determines it to be relevant to the site characterization, it is in their authority to require detailed evaluations. However, EPA disagrees th at this should be a requirement for all GS projects. In many cases, UIC Directors will ha ve extensive knowledge of which areas are suitable for GS, but clarifies that it is the res ponsibility of Class VI permit applicants to demonstrate the suitability of a particular site or formation. It is the respon sibility of the Director to evaluate the information collected and s ubmitted by the owner or operator to determine

27whether a permit for GS at the site is appropriate. EPA is developing guidance on site characterization for GS projects to assist owners or operators and Directors in evaluating permit requirements and applications under §146.82. The guidance provides recommendations to owners or ope rators regarding information to support characterizing the regional ge ology and hydrogeology of a proposed GS site as well as how to perform the necessary geochemical, geomechanical , and geophysical analyses of the injection and confining zone. EPA expects that this guida nce will assist permit writers/UIC Directors in making an objective decision about requiring additional confining layers. The guidance can be found on EPA’s website at http:/ /water.epa.gov/type/groundwater/ uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23397 Letter Lines: 626 to 650
Comment Code: 1610 1.3.1 Risks to USDWs
Comment: We agree with EPA that the approp riate standard underlying technical requirements for CO2 GS wells should be the protection of underground sources of drinking water ("USDWs"). Even though it is difficult to know at this point what methods or technology will be developed fo r injection and long-term storage of CO2 in a manner that is protective of USDWs –we know intuitively that sole source aquifers and some high risks seis mic locations should be ineligible. Proximity to Class IV wells might also be inappropriate (although those wells are very rare) because of their contents. In areas where there has been a history of Class I or Clas s II leakage or USDW contamination problems the state directors should have full discretion to ta ke those locations off the table for injection for long-term storage. APPA a ssumes that state directors will know best which geologic locations should be unsuitable or ineligible. But, we acknowledge that there are some risks not worth taking. Sole source aquifers are just not worth the risk for CO2 inject ion no matter how noble the goal of CO2 reductions might be. There are perhaps 10-15 sole source aquifers in the United States so APPA does not believe that removing these locations restricts the available geology storage in any sign ificant way on a national basis. In some cases, those power plants might need to be coal or gas with other carbon dioxide mitigation strategies such as the purchase of renewable credits or other measures that are outside the scope of this rule. APPA does not suggest that coal plants cannot be built near sole s ource aquifers since se questration could be conducted off-site if the infrastructure for moving the CO2 is in place or would be in place within a reasonable date after start up of the new power plant. Individual Response: EPA agrees that certain aspects of a site (e.g., the pr esence of seismic sources or sole-source aquifers) may make it unsuitable for GS. For this reason, owners and operators must submit extensive information about the proposed site in their permit applications, which the UIC Director must consider under §146.82 before issuing a Class VI permit. For example, the GS rule, at §146.82(a)(5) requires prospective owners or operators to submit

28information on all USDWs (which would include so le source aquifers) within the AoR. The GS rule also requires operators to submit extensive information about the site, including the geologic characteristics of the injection and confining zones, to demonstrate that the injected CO2 will remain within the target formation. The Dire ctor must consider this information when determining whether GS is acceptable at a given site. EPA expects that this determination will include consideration of potenti al impacts of the GS project on any sole source aquifers. In many cases, UIC Directors have extensive knowl edge of which areas are suitable for GS, but clarifies that it is the responsibility of Class VI permit applicants to demonstrate the suitability of a particular site or formation. It is the responsibility of the Dir ector to evaluate the information collected and submitted by the owner or operator to determine whether a permit for GS at the site is appropriate. EPA is developing guidance for permitting authoriti es. This guidance will be available on EPA’s website at http://water.epa.gov/type/gr oundwater/uic/wells_se questration.cfm.

Letter ID: 0169 Comment ID: 23398 Letter Lines: 652 to 662
Comment Code: 3120 2.1.2 Need to identify additional confining and containment zones (seeking comment)
Comment: APPA is not expert on drilling practices and many of the site characterization techniques discussed in the proposed rule . As discussed below, the Final Rule should leave the door open for a range of injection sites (except for sole source aquifers which we believe should be excluded from consideration) and methods (some of which are unrecognized, or even unknowable, at this point in time), provided that the Owner or Operat or can show that the injection and storage will be protective of USDWs. APPA does join its "sister" organization, AWWA, representing the water utilities, in cal ling for proposed GS projects to at least identify all the confining zones in applications. APPA does not believe that multiple confining zones should be ar bitrarily required. We defer to state directors to make these judgments ba sed upon their knowledge of local geology. Individual Response: EPA retains the requirement to iden tify additional containment/confining zones, if required by the Di rector, as proposed (§146.83(b)). EPA acknowledges that such additional zones may not be needed in all circumst ances, and clarifies that this requirement is at the Director's discretion, based on his or her understanding of a part icular site. EPA believes that, in some situations, the presence of additional confining and containment zones above the primary (i.e., lowermost) confining zone can improve USDW protecti on. These layers could further impede vertical fluid movement and al low for pressure dissipation, and also provide additional sites for monitoring, mitigation, and re mediation. The Agency believes that providing the Director discretion will allow consideration of a range of sites for GS, based on site-specific conditions and ensure USDW protection. EPA believes that requiring appropriate site characterization by the owner or operator (und er §146.82) and providing an appropriate degree of flexibility to the Director to evaluate site -specific geologic data will afford the greatest protection of USDWs from endangerment.

29Letter ID: 0169 Comment ID: 23399 Letter Lines: 664 to 673
Comment Code: 3500 2.2.3 Area of Review Reevaluation (seeking comment)
Comment: Area of Review: APPA has nominal b ackground in Area of Review, but we do believe that AoR sites require periodic review. Gi ven the fact that carbon sequestration technology is still developing, and the wi dely varied characteristics and limitations of different CO2 GS projects, it is essential to incorporate performance-based standards into the Fina l Rule, with site-tailored approaches to requirements for Area of Review ("Ao R") reevaluation and pos t-injection site care and closure periods. APPA believes th at the AoR should be periodically reviewed at least every five years for th e first 10 years. At the conclusion of the tenth year APPA believes that a less stringent periodic review should be allowed by the director if he so choos es. However, APPA believes that the Individual Response: EPA agrees that reevaluations of the AoR every ten years may not be sufficient to appropriately model plume and pre ssure front movement, establish conditions for corrective action, and ensure pr otection of USDWs from endange rment. For these reasons, the Agency changed the minimum frequency for th e AoR reevaluation at §146.84(e) from 10 years to at least every 5 years in the final GS rule. EPA believes that this re vised frequency addresses commenters' concerns about the inherent uncertainties in modeling CO2 movement, the emerging nature of GS technology, risk-based targeting of monitoring activities, and the unique nature of CO2 GS. EPA disagrees that a longer reevaluation freque ncy in the later years of the project is appropriate, however. EPA believes that the same justifications for reevaluations will continue to apply. EPA adds th at if site monitoring data agrees with the existing AoR delineation, the AoR reevaluation may consist of a demonstration that the current AoR delineation is adequate base d on site monitoring data.

Letter ID: 0169 Comment ID: 23400 Letter Lines: 673 to 683
Comment Code: 1310 1.1.2.4 Comments on other "out of scope" issues, e.g., pore space ownership
Comment: allowed by the director if he so choos es. However, APPA believes that the operation of the power plant should not be stopped if the geologic storage or sequestration is deemed ill advised by th e state director (or court). Only the CO2 injection in that location should cease. Instead the owner/ operator of that power plant should be allowed to con tinue operations for the purpose of generating electricity (and other functions ) without CO2 inject ion until either a different technique is developed or until infrastructure can be built to move the CO2 to a different injection loca tion. In some cases, the power plant owner/operator will simply have to make commercial or contractual arrangements to pay a party to take the CO2 for in jection or geoengineering mitigation measures (not yet identified).

30Individual Response: The UIC program’s authority under the SDWA focuses on ensuring that Class VI GS projects are permitted, sited, constructed, operated, monitored, and closed in a manner that protects USDWs from endangerment. EPA clarifies that the Class VI GS regulation applies to owners or operators of wells that will be used to inject CO2 into the subsurface for the purpose of long-term storage and does not require a ny facilities to capture and/or sequester CO2 and that permitting of power plants is outside the scope of the Class VI GS rulemaking.

Letter ID: 0169 Comment ID: 23401 Letter Lines: 685 to 726
Comment Code: 3350 2.2.1.5 Use of proprietary models for GS sites (seeking comment)
Comment: Use of proprietary models: EPA asked about AoR and proprietary models. APPA is not expert on models but has some gene ral discomfort with relying solely on proprietary models owned/operated by a thir d party-particularly when there are only approximately five companies in the United States that have such sophisticated models for AoR modeling. Propr ietary models are de rigueur in the oil and gas extractive industry. We would not seek to change that for such a critical industry to our economy and to our own natural resource needs. However, it would not lead to an easy future for power plant owner/operators to not know how site selection and AoR decisions are made because the owner/operator of the AoR work would use confidential the proprieta ry models from even the power plant owner/operator. It would be rare to ha ve such a significant portion of the operational costs where the power plant’s ma nagement could not review the model or run a cross check proprietary models to affirm site selection or to do double checks after operations had begun. This is a tricky question for APPA. The AoR decisions will be fundamental to the en tire geologic sequestration decision tree. Yet, if proprietary models are used, the power plant management will have little say over the geosequestration op erations. Additionally, relying upon proprietary models for such a significant portion of th e geologic sequestration decision making will be anti-competitive. It is not easy for power plants owner/operators to easily know what the costs of an operation will be for the consumers if they are relying upon proprieta ry AoR models at the beginning of the geologic sequestration process and relying upon these same models during the 40-50 year life of the plant. APPA would prefer that the use of a replicatable model is used. This may need considerable work by the U. S. EPA to ensure that the proprietary nature of these seismic modeling products and services are not exposed in a way that harms the oil field services industry. Perhaps the EPA can review what confidential business informa tion methods are undertaken in the Food and Drug Administration or Homeland Securi ty Administration as those agencies review very confidential drug testing or security data which much be confidential but still usable and able to be reviewed. APPA respects that the true value in the oil and gas extractive industry is in the quality of its seismic readings tec hnology and models that make it the preeminent in the world. No one at APPA wants to tamper with that. We wonder if

31some sort of proprietary method can be ar ranged for the AoR models to be run off of proprietary models where the model can at least be reviewed or replicated for quality purposes by the state director and the power plant owner/operator. Without this ability to have a handle on operational costs and decisions made by the contractors to the power sector, many public power communities would be reticent to commit to a technology where th e proprietary model sets in motion most major decisions without a way to review them or make mid-course corrections. Individual Response: EPA agrees that available proprieta ry models may meet the complex needs for calculating the AoRs of GS sites, and sh ares their concern about the need to evaluate the inputs and assumptions used. EPA notes th at several proprietary models are currently, successfully used by petroleum-reservoir engineeri ng professionals as well as in peer-reviewed studies to model CO2 sequestration. EPA adds that its Confidential Business Information requirements at 40 CFR 144.5 will apply to the use of proprietary models. EPA clarifies that owners or operators have flexib ility to select the most appropriate models for the conditions at the GS site a nd based on the types and amount of data available given the wide range of site-specific conditi ons present at GS sites. To ensure that all predictive models used for AoR calculations are meeting the Agency's expectations, EPA plans, every six years, to coll ect and review data on GS projects to determine whether the appropriate amount and types of information and appropriate documentation are being collected, and to determine if modificatio ns to the requirements are appropriate or necessary.

Letter ID: 0169 Comment ID: 23402 Letter Lines: 731 to 743
Comment Code: 1250 1.1.1.4 Flexibility is needed (p erformance-based standards)
Comment: · Because the technology described in the Proposal will not be commercially and widely deployed (in states without oil and gas production) for perhaps as long as 30 years, the Final Rule must be flex ible enough to accommodate developments in information and technology rela ted to carbon sequestration. These developments could reflect knowledge that affirms the technology and minimizes any cautions or concerns expressed by A PPA regarding USDW risk, liability, etc. · APPA is really not qualified to comments on site selection or well construction or injection procedures. A PPA defers to decision making by the state directors (or EPA in the case of non-delegated states on these aspect). EPA’s Final Rule should keep as many op tions regarding site and method of injection available, subject to the standa rd that any CO2 GS be protective of underground sources of drinking water ("USDWs"). Individual Response: As described above, EPA believes the ru le provides flexibility to address

32site-specific conditions. EPA is using an adaptive approach to regulating GS under the UIC Program.

Letter ID: 0169 Comment ID: 23403 Letter Lines: 745 to 749
Comment Code: 1320 1.1.3 General comments about GS Comment Code: 5600 2.11 Comments related to UIC Program primacy for Class VI wells
Comment: Because state regulators in approximately five or six states have worked extensively with Owners or Operators of UI C Class V experimental CO2 wells they have familiarity with environmental, geol ogic, and financial concerns specific to a given region, their adoption and tail ored implementation of the CO2 GS rules will be crucial to the success of the Program. Individual Response: EPA acknowledges the expertise of exis ting State, Tribal, and Territorial programs that implement the UIC requirements under Section 1422 of the SDWA (Class I, III, IV, and V wells (particularly Class V experime ntal technology wells)) and state oil and gas agencies that have been regulating Class II UIC wells for decades unde r section 1425 of SDWA. These agencies already understand the techni cal and administrative issues involved in construction, operation, injection and permitting as well as, in the case of Class II operators issues related to CO2 injection, subsurface operations, and pipeline transport. EPA believes that existing programs can adapt this expertise to th e new requirements for Class VI wells and will be able to develop a primacy application for Cl ass VI wells under section 1422 of SDWA. Many of the tools, resources, expertise, and infr astructure currently exist within States to effectively and efficiently manage GS projects. Additionally, States can use multiple authorities beyond those afforded under the SDWA and UIC regulations including surface access and land rights, unitization of fields, pore space ownership, mineral right s, site safety and emergency preparedness, and maximization of State oil and gas resource exploitation.

Letter ID: 0169 Comment ID: 23404 Letter Lines: 751 to 754
Comment Code: 2060 1.5.3 Comments on grandfathering of existing wells (seeking comment)
Comment: Although there are significan t similarities between th e proposed requirements for Class VI wells and the existing requi rements for Class I, II, and V wells under the UIC Program, APPA does not believ e that there should be a presumed grandfathering of Class I, II and V for th e Class VI as storage sites. APPA Individual Response: EPA agrees that a cautious approach to grandfathering is appropriate, particularly given that the convert ed well will be used for a substa ntially different process, which involves increased reservoir pre ssures associated with large volumes of stored CO2 and the corrosivity of CO2 in the presence of water. Th e final GS rule provides for the construction of these wells to be grandfathered (per 146.81(c)). EPA has included a requirement in the final GS rule that owners or operators seeking to c onvert existing wells for long term storage must

33demonstrate to the Director that the grandfathe red wells were engineered and constructed meet the requirements at §146.86(a) and ensure prot ection of USDWs, in lieu of requirements at §146.86(b) and §146.87(a). EPA clarifies that only the construction requirements are grandfathered and that all other Class VI requirements (reporting, monitoring, mechnical integrity testing, etc.) must be met fo llowing a determination under §146.81(c).

Letter ID: 0169 Comment ID: 23405 Letter Lines: 754 to 764
Comment Code: 2046 1.5.2.3 Continuing to classify CO2 in jection for EOR/EGR as Class II/ dividing line between Class II and Class VI (seeking comment)
Comment: grandfathering of Class I, II and V for th e Class VI as storage sites. APPA cannot easily imagine why an oil and ga s production field would typically want to move from a Class II to a Class VI well classification since oil and gas recovery is always technically possible at the right price. Besides, UIC Class II production classification has certain other regulatory and commercial advantages to remain as Class II to the oil and gas sector. Fe w wells are truly ever 100% depleted since newer technol ogy may make unreachable oil and gas obtainable. APPA does not oppose state directors who be lieve that they should grandfather a well from Class II to a Cl ass VI provided that it can be demonstrated to the state’s satisfaction th at such carrying over of requirements will be protective of USDWs. Individual Response: EPA believes that injection for the primary purpose of long term storage is sufficiently different from Class II ER opera tions and warrants tailored requirements in order to protect USDWs from endangerment. For exam ple, the volume of CO 2 anticipated to be injected in Class VI wells is significantly great er than for Class II wells. Reservoir pressure conditions will also be different, with Class VI injection operations involving large volumes of CO2 and likely having higher pressure s within their storage formations than Class II ER projects. The final Class VI regulations re quire that any owner or operato r injecting CO2 for the primary purpose of long term storage obtain a Class VI pe rmit with some special consideration for the fact that they are transitioning from a well not or iginally designed to meet Class VI requirements. The Director has the authority to determine at wh at point a Class VI permit is required for those projects that are transitioning from the primar y purpose of EOR to long term storage of CO2. The final regulation provides a set of technical factors for the Direct or to evaluate in making this determination, at §144.19. EPA believes that this approach provides su fficient protection of USDWs when there is an increased risk to USDWs as compared to traditi onal Class II operations while allowing for site-specific flexibility. For more information, please see the discussion on transition of Class II wells in the preamble to the final GS rule. EPA is developing guidance on transitioning perm its from Class II to Class VI. The guidance will assist Directors in determining whether an injection project should be transitioned from Class II where the primary purpose is oil and gas production to Class VI where the primary purpose is long-term storage of large volumes of CO2. The gu idance describes the methods available for the Director to evaluate cha nges in risk to USDWs from projects, and

34recommended approaches the Director may use to evaluate whether a project should be regulated within the Class II or Class VI UIC program. This guidance will be available on EPA’s website at http://water.epa.gov /type/groundwater/uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23406 Letter Lines: 766 to 779
Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment)
Comment: · EPA prematurely assumes that the CO2 inj ected for GS is a solid waste. The CO2 that will be captured and injected for long- term storage into Class VI wells is an uncontained gas and therefore does not meet the statutory definition of a "solid waste" under the Resource Cons ervation and Recovery Act ("RCRA"). Further, it is premature to assume that material will be "discarded" as CO2 is currently used as a commodity in a vari ety of manufacturing processes. To the extent there is any possibility that CO 2 injection operations could be subject to RCRA controls, EPA should exempt such activities from RCRA's corrective action program under the well established "c ontingent management" concept given that the UIC permit will ensure that the injected material is not mismanaged. APPA is confident that state director s will have strict rules on how the injections are managed. On this topic of RCRA and solid waste, APPA defers to the Utility Solid Waste Activities Group (USW AG) and recommends those aspects of their comments. Individual Response: As described above, EPA has decide d to initiate a separate proposed rulemaking specifically to examine the issue of RCRA applicability to CO2 streams being geologically sequestered, including the possible option of a conditional exemption from the RCRA requirements for CO2 GS in Class VI wells.

Letter ID: 0169 Comment ID: 23407 Letter Lines: 781 to 785
Comment Code: 3150 2.1.5 Comments on required permit information (40 CFR 146.82) Comment Code: 4710 2.7.1 Proposed submissions required for permit applications (seeking comment)
Comment: · The Final Rule must not make the ap plication process overly burdensome or unrealistic by requiring detailed informati on that may not be available at the time of the initial application; inst ead, the Final Rule should allow for submission of updated information regardi ng a CO2 GS well and its AoR as that information becomes available th rough phased corrective action. Individual Response: EPA agrees that not all of the information listed at §146.82 of the proposed regulation will be avai lable at the time the owner or operator develops their initial permit application. In response to comments and based on an evaluation of the proposed requirements at §146.82, the Agency revised this subpart so that the final regulation specifies separate requirements for information to be submitted with the permit application and before

35well construction is approved (at §146.82(a)) and in formation to be submitted before operation of the well is authorized (at §146.82(c)).
EPA believes that this revisi on of §146.82 addresses commenters' concerns regarding the timing of information to be submitted. In addition, section §146.82 in the final rule is similar to the permit application requirements for other inje ction well classes, which could help avoid confusion about how to meet the permitting requirem ents for Class VI wells. The requirements at §146.82(c) for information to be submitted before operation of the well is authorized are very similar to those for Class I wells, with modifi cations and additions th at address the unique challenges and types of data collected for GS wells. The final rule requires for the submission of updated information on the well and its AoR. The final GS rule, at §§146.84(c) and §146.90(j) requires owners or ope rators to review and update the AoR and corrective action plan and the tes ting and monitoring plan, at least once every 5 years, throughout the life of the project. Owners or operators must review each plan and identify necessary modifications to the plan or demonstrat e to the Director that no amendment is needed. These reviews must be performed within one year of an AoR reevaluation, following any significant changes to the facility (e.g., the additi on of monitoring or injection wells), or when required by the Director. While the rule does not sp ecify that changes in phased corrective action warrant an update, the Director may determine th at these types of modifications need to be incorporated into a plan update. EPA is devel oping guidance on developing and updating the GS project plans, which includes recommended cons iderations for developing and updating the plans. This guidance will be available on EPA’s website at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23408 Letter Lines: 787 to 790
Comment Code: 2020 1.5.1 Support Class VI designation
Comment: General Issues Related to Classifica tion and Regulation of CO2 GS Wells APPA believes the creation of a new categ ory of wells under the UIC Program for long-term storage of CO2 is appropriate. Id. at 43502 Individual Response: As described above, EPA agrees that tailored requirements for Class VI wells are necessary to address the unique nature of injecting larg e volumes of CO2 and to ensure that USDWs are protected from endangerment.

Letter ID: 0169 Comment ID: 23409 Letter Lines: 792 to 813
Comment Code: 5610 2.11.1 Allowing partial primacy for Class VI wells (seeking comment)
Comment: With respect to the integration of State pr ograms, APPA agrees with EPA that the Final Rule should create a delegable pr ogram and encourage the adoption and implementation of that program by States. A PPA realizes that some states have no

36experience with oil and gas use of CO2 but encourages all states to adopt the program. Adopting the program does not au tomatically presume that all power plants built and opera ted in those states will be able to conduct geologic sequestration in that state. Id. at 434 97. State regulators have familiarity with local environmental, geologic, and financial conc erns, and in many cases have pre-existing relationships with the regulated community th at can facilitate implementation of a new and complex regulat ory program. For these reasons, APPA also believes it is appropriate to allow States to obtain primacy for only Class VI wells if a particular State so choo ses. Id. at 43523. Such class-specific primacy is consistent with the statutor y authorization behind the UIC Program, and EPA correctly predicts that States obtaining primacy for Class VI wells, regardless of whether they have sought primacy under other aspects of the UIC program, may be more likely to develop a comprehensive regulatory program for all aspects of carbon capture and storag e. Id.; see also 42 U.S.C. § 300h-1 (SDWA § 1422). Simply put, APPA is not tryi ng to force states to have Class I and Class II UIC programs in order to ha ve Class VI programs. States may well decide that they still are not comfor table with a Class II or Class I UIC program. APPA has no desire to change those state policies through this UIC rulemaking. Individual Response: EPA agrees that states should be al lowed to obtain primacy for Class VI wells independently of other well classes, and wi ll allow independent primacy for Class VI wells under §145.1(i) of the final GS rule. In the past , EPA has not accepted UIC primacy applications for individual well classes unde r Section 1422 of SDWA. In other words, if a State wanted primacy for Class I wells, the State would also ne ed to accept responsibilit y for Class III, IV, and V wells. This policy has been in place since the initiation of the UIC Program in the early 1980s and was intended to encourage states to take full responsibility fo r UIC programs, avoid duplication of efforts, and provide for administrative efficiencies. However, given the potential for CCS (encom passing capture, transportation, and geologic sequestration) to be an important part of a na tional priority to address climate change, EPA believes that providing states the flexibility to obtain primacy for Class VI wells independently of other well classes can help foster effective management of CCS. EPA believes that allowing independent Class VI primacy may encourage states to take res ponsibility for implementation of Class VI regulations and provide for a more co mprehensive approach to managing CCS projects by promoting the integration of GS activities under SDWA in to a broader framework for managing CCS. Furthermore, GS operations involve ancillary activities (e.g., pipeline operations, pore space ownership, land use rights, and surface access) for which states can call upon other authorities that exist at the state leve l (but outside UIC author ity) to provide a more comprehensive CCS management approach. The Agency believes that it is important for stat es to use their unique e fficiencies to promote adoption of this burgeoning and important tec hnology, while assuring that USDWs are protected from endangerment through the UIC regulatory framework. EPA believe s that, due to the importance of implementing an effective, comprehensive, and seamless CCS program, States should be provided the flexibility to obtain primacy for Class VI only.

37EPA also believes that allowing states to apply only for Class VI primacy will shorten the primacy approval process for states. EPA's willingness to accept independent primacy applications for Class VI wells represents a shift in its longstandi ng policy of discouraging "partial primacy." It is very important to note that this shift in policy allowing for Class VI primacy does not apply to any other well Cl ass under Section 1422. EPA will continue to discourage applications for pa rtial primacy for all other well types under Section 1422.
EPA clarifies that states should be able to obtain primacy for Cla ss VI wells independent of other well classes provided they devel op regulations that are at leas t as stringent as the minimum Federal requirements (e.g., permitting, inspec tion, operation, monitoring, and recordkeeping requirements) provided in the final GS rule. EPA believes that existing programs can adapt their expertise to the new requirements for Class VI wells and will be able to develop a primacy application for Class VI wells under section 1422 of SDWA and en sure that their GS programs integrate into national climate change priori ties and protect USDWs from endangerment. EPA recognizes that some states have already begun legislative e fforts that are wider in scope than the federal GS rule and believes that allo wing Class VI primacy (i ndependent of other well classes) may encourage states to take responsibility for implemen tation of a more comprehensive approach to managing CCS proj ects (e.g., capture, transportation, and geologic sequestration).

Letter ID: 0169 Comment ID: 23410 Letter Lines: 815 to 844
Comment Code: 2060 1.5.3 Comments on grandfathering of existing wells (seeking comment)
Comment: Grandfathering Requirements of Cl ass I, II, and V UIC Wells This is an extremely important issue as a few APPA members plan to invest substantial resources in developing a nd permitting Class V experimental CO2 injection wells to help demonstrate the viability of large-scale commercial deployment of CO2 sequestration. Some of these may also be conducted as DOE/NETL or state research or demonstration pr ojects to illustrate how CO2 can be separated and injected. Federal and st ate governments should encourage these research and demonstration efforts, as th eir success is critical to the largescale commercial deployment of CO2 sequestration. The opportunity to operate these wells on a regular basis after they have been shown to be effective on an experimental basis should be allowed to he lp encourage the subs tantial, upfront investment necessary to get these wells permitted. APPA believes that the state should be allowed to grandfather of cons truction requirements for existing Class I, II, and V wells seeking a Class VI perm it for GS of CO2 if the state believes that the Class V experimental well USDW pr otections are adequate . Since most of these new Class V experimental permits a ppear to be mirror images of Class I programs, APPA does not see how this w ill be a problem. Id. at 43502 In the case where the Class V program mirrored the Class I program, grandfathering of requirements beyond those related to c onstruction is both necessary and appropriate, particularly fo r Class V wells. As an initial point, it has already

38been determined through the permitting pro cess that the operation of these Class V wells is protective of USDWs. See 40 C. F.R. § 144 et seq. Having made this determination, there should be a regulatory presumption that conversion of these wells for the exact same activity - at a larger scale and for an extended time period - under the Class VI program is also protective of USDWs. However, APPA acknowledges and believes that the EPA fina l rule should clearly state that this should be done with the understanding that grandfathering will not be allowed if the Director demonstrates th at conversion of these Class V experimental wells to Class VI would jeopardize USDWs. Individual Response: EPA agrees that, when the Regiona l Carbon Sequestration Partnership projects are no longer of an experi mental nature, they should be re-permitted as Class VI wells if they are to be used for commercial-scale GS, and be subject to the Class VI requirements. EPA is provides for the construction of Cla ss V experimental technology wells to be grandfathered per §146.81(c), provid ed the owner or operator can demonstrate to the Director that the wells were engineered and constructed to meet th e requirements at §146.86(a) and ensure protection of USDWs, in lieu of requirements at §146.86(b) and §146.87(a). EPA understands based on reviews of several Class V pilot project permits, that many Class V experimental technology wells, including those used in the RCSP projects, are specifically designed for injection of CO2 and are being built to Class I non-hazardous well specifications, which should facilitate re-permitting as Class VI wells. EPA clarifies th at only the construction requirements are grandfathered and that all ot her Class VI requirements (reporting, monitoring, mechnical integrity testing, etc.) must be met following a determination under §146.81(c). EPA is preparing an addendum to UICPG #83 that describes the use of th e Class V experimental technology well classification to clarify perm itting for Class V wells. This addendum will address shifting of Class V experi mental projects to full-scale GS projects and the future use of the Class V experimental technology well s ubclass for research a nd testing of new GS technologies.

Letter ID: 0169 Comment ID: 23411 Letter Lines: 846 to 854
Comment Code: 2064 1.5.3.2 Grandfathering construction of Class II wells (seeking comment)
Comment: APPA recognizes that there are differences between Cla ss II wells and Class VI wells that may necessitate additional re quirements and safeguards as Class II wells transition to Class VI wells. 73 Fed. Reg. 43502. However, APPA recommends that the Final Rule include an option wh ereby Owners or Operators of Class II wells can make a demonstration that their well(s), if used for CO2 GS, will not pose a threat to USDWs. Such a case-by- case demonstration would allow for the carrying over of Class II well requirements where appropria te and protective of USDWs, maximizing the efficiency of such transitions while en suring that USDWs remain protected. Individual Response: EPA agrees that many Class II well s are designed and constructed to

39withstand exposure to CO2. The final GS rule provi des for the construction of these wells to be grandfathered per §146.81(c), provid ed the owner or operator can demonstrate to the Director that the wells were engineered and constructed to meet th e requirements at §146.86(a) and ensure protection of USDWs, in lieu of requirements at §146.86(b) and §146.87(a). The final Class VI regulations re quire that any owner or operato r injecting CO2 for the primary purpose of long term storage obtain a Class VI pe rmit with some special consideration for the fact that they are transitioning from a well not or iginally designed to meet Class VI requirements. The Director has the authority to determine at wh at point a Class VI permit is required for those projects that are transitioning from the primar y purpose of EOR to long term storage of CO2. The final regulation provides a set of technical factors for the Direct or to evaluate in making this determination, at §144.19. EPA believes that this approach provides su fficient protection of USDWs when there is an increased risk to USDWs as compared to traditi onal Class II operations while allowing for site-specific flexibility. EPA adds that, following re-permitting as Class VI wells, these projects would be subject to the operational, MIT, monitoring, reporting, plugging, and post-injection site care and site clos ure requirements in the final GS rule. EPA is developing guidance on transitioning perm its from Class II to Class VI. The guidance will assist Directors in evaluating whether an in jection project should be transitioned from Class II where the primary purpose is oi l and gas production to Class VI where the primary purpose is long-term storage of large volumes of CO2. The guidance describes recommended methods the Director may use to determine changes in risk to USDWs from projects, and how the Director may determine whether a project should be regulated within the Class II or Class VI UIC program. This guidance will be available on EPA’s website at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23412 Letter Lines: 856 to 869
Comment Code: 2100 1.6 Target Geologic Formations for GS
Comment: Siting of CO2 GS Wells As discussed above, APPA believes it is c ounter-productive at th is stage in the development of a CO2 GS regulatory re gime to categorically preclude any potentially feasible injection formations as possible long-term storage sites with the exception of sole source aquife rs. EPA correctly recognizes that the commercial deployment of CO2 GS activities will result in the new production of large volumes of CO2 for which owners or operators will have to locate new and environmentally protective injection zone s. It makes sound policy sense for EPA to encourage the identification and utiliz ation of as many protective zones as possible, with the prerequisite that any injection site be pr otective of USDWs. Injection of CO2 should be allowed as l ong as it can be demonstrated that injection will be protective of USDWs and meet other applicable conditions for Class VI CO2 GS wells. APPA offers no opinions on injection of CO2 into coal

40Individual Response: As described above, EPA clarifies that the GS rule does not categorically preclude injection of CO2 into any non-USDW formation types.

Letter ID: 0169 Comment ID: 23413 Letter Lines: 869 to 871
Comment Code: 4320 2.4.4.1 Injection beneath the lowermos t formation containing a USDW Comment Code: 4430 2.4.4.3.3 Injection into coal seams above USDWs (seeking comment)
Comment: Class VI CO2 GS wells. APPA offers no opinions on injection of CO2 into coal seams. APPA defers to the American Water Works Association regarding the questions pertaining to whether above or below the lowermost USDW. The EPA asked Individual Response: EPA believes that there are limited circumstances where injection above the lowermost USDW can be performed in a ma nner that protects USDWs from endangerment, as long as appropriate protections are in place. The final GS ru le at §146.95 establishes a process by which owners or operators can seek a waiver of the Class VI injection depth requirements for injection into non-USDW formations above and/or be tween USDWs. EPA believes that these requirements will ensure USDW protection while providing flexibility to UIC program Directors and owne rs or operators who undertak e CO2 injection for GS. The Agency believes this approach: 1) responds to co ncerns about local and re gional geologic storage capacity limitations imposed by th e proposed injection depth require ments; 2) allows for a more site-specific assessment of injection depth for GS projects; 3) accommodates injection into different formation types; 4) a llows for injection of CO2 for GS into non-USDWs above and/or between USDWs when appropriate and where it can be demonstrated that USDWs will be protected; and 5) responds to concerns about the use of aqui fer exemptions for GS. Finally, EPA’s approach to addressing injection depth va riability through a waiver process responds to concerns about future drinking wa ter resource availability and the need to ensure that high quality water remains available in sufficient qua ntities to supply drinking water needs. For additional information on the waiver approach, pleas e see the final rule and preamble, as well as EPA's responses to comments on the Notice of Data Availability and Request for Comment.

Letter ID: 0169 Comment ID: 23414 Letter Lines: 872 to 879
Comment Code: 2200 1.6.4 Other formation types
Comment: for comments on basalt, salt domes or shal es. APPA is not qualified to offer any opinions about formations such as basalts, salt domes, or shales. APPA presumes that these site choice issues will be clearer after demonstrations by the U.S. DOE regional partnership and private R& D pilots. Id. at 43503. If it can be demonstrated that the injection of CO2 in to such sites is protective of USDWs, then such activities should be allowe d under the Class VI UIC program. At a minimum, we know that more demonstrati on projects are needed looking at diverse geology for maximum use of coal whic h is an essential fuel source.

41Individual Response: The final GS rule does not precl ude injection into any non-USDW formation type provided owners or operators can demonstrate th at GS can be performed in a manner that protects USDWs from endangermen t. The Agency acknowledges that GS into basalts, salt domes, and shales wi ll likely have limited applicati on, or that owners or operators seeking Class VI permits for injection into these fo rmations may not be able to meet the final GS requirements or demonstrat e protection of USDWs. The purpose of the GS rule is to ensure protect ion of USDWs, and the ru le includes requirements to ensure that the geologic formations are adeq uate to receive and confine injected CO2, at §146.83. The siting, well constructio n, operational, and other requirements in the GS rule are designed to ensure that injected CO2 remains within the target formation. EPA acknowledges that there may be risks associat ed with GS, particularly regarding GS into basalts, which have been the subject of limited e xperimental projects in the past. EPA anticipates that in the short-term, GS into basalts, salt domes, shales, limestone formations, and fractured karst will continue to be experime ntal in nature (i.e., if they are to test GS technologies and collect data), and will likely be permitted as Class V experimental technology wells and be subject to UIC Program Guidance #83. EPA will continue to review data on early GS projects, including those in such formations, to determ ine whether the appropria te amount and types of information and documentation are required and bei ng collected. EPA plans, every six years, to collect and review data on GS projects to dete rmine whether the appropriate amount and types of information and appropriate documentation are being collected, and to determine if modifications to the requirements are appropriate or necessary.

Letter ID: 0169 Comment ID: 23415 Letter Lines: 881 to 962
Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment)
Comment: Interaction with RCRA The U.S. EPA seeks comment on the questi on of whether CO2 that exhibits a Resource Conservation and Recovery Act or "RCRA" hazardous waste characteristic should be precluded from injection in a Cl ass VI CO2 GS well. Id. at 43503. APPA questions the underlying premise behind EP A's discussion regarding the potential applicability of the RCRA hazardous wast e regulations to CO2 GS. Id. The fundamental error in EPA's request for co mment on this point is its premature assumption that CO2 is being discarded and therefore is a solid waste. A material cannot be a RCRA hazardous waste if it is not first a "solid waste." See 40 C.F.R. § 261.2. The statutory definiti on of "solid waste" is limited to specified "discarded" materi als; a material cannot be a "solid waste" unless it has first been "discarded." 42 U.S.C. § 6903 (RCRA § 3001). While there have been numerous judicial decisions addre ssing what constitutes "discard," the fundamental holding from these cases is simple and straight forward: Congress intended to extend EPA’s authority to regul ate "solid waste" under RCRA "only to materials that are truly discarded, dis posed of, thrown away, or abandoned" American Mining Congress v. EPA, 824 F.2d 1177, 1190 (D.C. Cir. 1987) (emphasis

42added). The D.C. Circuit has emphasized th at the "plain meaning" of the term "solid waste" extends only to materials that are "discarded" and that the term "discard" should be interpreted with refere nce to its ordinary meaning. Ass’n of Battery Recyclers, Inc. v. EPA, 208 F.3d 1047, 1051-52 (D.C. Cir. 2000). CO2 is a valuable commodity used in a variety of manufacturing opera tions, including in the enhanced oil recovery ("EOR") and e nhanced gas recovery ("EGR") production process. When used in these commercial oil/gas production applications, CO2 is not "discarded" and therefor e is not a solid waste. Wh ile large volumes of CO2 will be produced under the carbon capture and sequestration programs contemplated by the UIC Class VI program , it is premature for EPA to presume that these additional volumes of CO2 will not retain commercial value and that their sequestration in Class VI wells auto matically means that they have been "discarded" as that term has been define d under RCRA. As we ha ve already noted, the Agency should refrain from making categ orical assumptions associated with this still-emerging technology associated with the commercial deployment of CO2 GS operations, including with respect to th e status of captured CO2 destined for GS. Finally, assuming, for purposes of argume nt, that CO2 is "discarded" and exhibits a hazardous waste characteris tic when injected for long-term sequestration, there are compelling policy reasons to exclude such activities from RCRA regulation. Subjecting these in jection operations to regulation under a Class I UIC hazardous waste injection permit could expose all other waste management units at the power plant facili ty, including units that are in no way related to the injection operations, to the full panoply of RCRA’s Subtitle C corrective action program. This is because a Class I UIC hazardous waste injection permit is a classified as a RCRA "permit by rule" under RCRA’s hazardous waste permit program. See 40 C.F.R. §§ 270.1(c)(1)(i) and 270.64. Facilities that have obtained a RCRA perm it by rule for the operation of a Class I UIC hazardous waste injection well are potentially subject to the full scope of RCRA’s corrective action program fo r all solid waste management units ("SWMUs") located at the facility. If RCRA were to regulate the CO2 as a waste this would make many power plant owne r/operators reticent to pursue these technologies. See EPA RCRA/Superfund Hotlin e Monthly Summary, "Corrective Action for UIC Wells," April 1986 (9502.1986(07)). The specter of RCRA corrective action is a significant economic and pract ical operational ob stacle for any facility considering whet her to seek a permit for a new Class VI well for geosequestration. The imposition of this obstacle is comple tely unwarranted. A ny well receiving a permit under the UIC Program for CO2 GS will be, by definition, protective of USDWs. EPA’s RCRA program has established a legally sound process, referred to as "contingent management," for the excl usion of materials from hazardous waste regulation when such materials are alrea dy subject to an a lternate regulatory regime that ensures the wastes are mana ged in an environmentally protective manner. EPA has employed the contingent ma nagement concept in several contexts

43where the Agency determined that other regulatory regimes ade quately addressed any potential mismanagement scenarios related to certain materials, including used oil and military munitions.
The D.C. Circuit has reviewed EPA's le gal theory underlying the contingent management concept and found it to be a "permissible construction of the statute" - namely, that the statutor y definition of "hazardous waste" is predicated upon the risks posed by a solid waste when "improperly" managed; therefore, "where a waste might pose a hazard only under limited management scenarios, and other regulatory programs already address such scenarios, EPA is not required to classify a waste as hazardous waste s ubject to regulation under [RCRA] Subtitle C." Military Toxics Pr oject v. EPA, 146 F.3d 948, 958 (D.C. Cir 1998) (emphasis added).
APPA believes that RCRA corrective action for the entire power plant would rank with parasitic power loss as strong dete rrents to geologic sequestration for many small municipality power plant owner/operators. We do not want to see these CCS projects prevented because of RCRA waste concerns. Individual Response: EPA received many comments regardi ng the applicability of the RCRA regulations and statute to CO2 st reams that are geologically seque stered under the final Class VI UIC well requirements. As a result, EPA has deci ded to initiate a sepa rate proposed rulemaking specifically to examine the issue of RCRA appl icability to CO2 streams being geologically sequestered, including the possible option of a conditional exemption from the RCRA requirements for CO2 GS in Class VI wells. EPA will consider these comments as part of its development of that proposal. The Agency will consider issues pa rticular to RCRA in the context of that separate rulemaking, and recommends that the commenter read that proposed rule when it is published. The Agency notes that comment ers who wish to submit comments on the RCRA proposal will need to do so during the comment pe riod for that rule. Finall y, EPA also notes that the final GS rule, which adds ne w regulations for Class VI wells under the Safe Drinking Water Act (SDWA), is not making any ch anges to the RCRA regulations.

Letter ID: 0169 Comment ID: 23417 Letter Lines: 1029 to 1040
Comment Code: 4740 2.7.4 Electronic reporting (seeking comment)
Comment: Permit Application and Reporting Requirements
The EPA asks for comments about electroni c reporting. Any requi rement contained in the Final Rule for electronic reporti ng should not be absolute but should instead allow the Director to allow othe r methods of reporting when he deems such methods more appropriate. APPA imagines that by the time CCS is widely commercially viable, electronic filing (or whatever society considers "electronic filing of data" will be at th at future date) will be the least of our cost or operational concerns. APPA would suggests that ear ly projects, say in the first five years, have some modest leniency for ways to file effectively

44and responsibly without the presumption of real time data on every imaginable data point. We also suggest that the EPA have some r easonable test for response Individual Response: EPA believes that electronic formatting is the most appropriate format for submitting Class VI project information to the Director, and based on comments received on the proposed rule, the majority of Class VI well owners or operators will have the capability to report electronically, and re quires this at §146.91(e). EPA is developing guidance for states that describes the recordkeeping, reporting, and additional data management needs associated with GS act ivities and provides recommended guidelines on the types of data to be collected for tracki ng GS projects, reporti ng to EPA for compliance tracking, and transfer of data to EPA's GS data system. The recordkeeping and reporting guidance will be available on EPA's web site, at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23418 Letter Lines: 1040 to 1045
Comment Code: 4720 2.7.2 Operational record keeping and reporting Comment Code: 5800 2.13 Comments on emergency and re medial response (40 CFR 146.94)
Comment: data point. We also suggest that the EPA have some r easonable test for response to the state or Federal permitting agency in the event that a reporting event happens on a weekend or during nighttime hour s. Some owner/operators will be on different time zones than the injection well operator. APPA suggests that a reasonable time be allowed for reporting to be sent in on routine data where there is no catastrophic reporting event. Individual Response: EPA clarifies that the requirement at §146.94(b)(3) is to notify the Director within 24 hours of an emergency. The Ag ency believes that the 24 hour timeframe for notifying the Director is a "reasonable" time period. Furthermore, permitting agency response personnel are typically "on call" 24 hours a day, 7 days a week.

Letter ID: 0169 Comment ID: 23419 Letter Lines: 1047 to 1059
Comment Code: 4760 2.7.6 Proposed reporting frequency (seeking comment)
Comment: With respect to the Proposal’s suggestion of an annual reporti ng requirement for CO2 GS projects, APPA apprec iates the importance of the information EPA seeks to gather but believes that annual reporting wi ll not always be the best way to collect this information over the lifet ime of the project. Id. at 43518. The Final Rule will require some form of pe riodic reevaluation of the AoR throughout the life of the project; much of the information sought through the proposed annual reporting requirement would be gath ered and submitted to EPA through the AoR reevaluation process. Gathering this information through the AoR reevaluations alone, rather than imposing an unnecessa ry and duplicative annual

45reporting requirement, will provide a more cost-effective and manageable method of information exchange for regulators and Owners or Operators alike. APPA prefers the idea of reporting every five years in the first 20 years of operations. Individual Response: The final GS regulation retains the reporting requirements as proposed and does not include a requirement for an annual report. EPA agrees that the AoR reevaluations offer a good opportunity to promote a dialogue be tween the owner or operator and the permitting authority. The final GS rule, at §§146.84(c), 146.90(j), and 146.94(d), requires owners or operators to review and update the AoR and corrective action pl an, the testing and monitoring plan, and the emergency and remedial response pl an throughout the life of the project. Owners or operators must review each plan and identify n ecessary amendments to the plan or demonstrate to the Director that no amendment is needed. Th ese reviews must be performed within one year of an AoR reevaluation, following any significant changes to the facility (e.g., the addition of monitoring or injection wells), or when required by the Director . In no case can reviews occur less often than once every five years. EPA encourages and expects owners and operators to share monitoring a nd operating data with the public voluntarily (e.g., through the Inte rnet), however. Providing the public with information throughout the GS project will help clear up and avoid public misperceptions about the nature and safety of GS. See the final rule and preamble for further discussion on EPA's final approach to reporting and recordkeeping.

Letter ID: 0169 Comment ID: 23420 Letter Lines: 1061 to 1084
Comment Code: 5240 2.8.2.2 Post injection timeframe (seeking comment)
Comment: Well Plugging and Post-Inj ection Site Care APPA acknowledges that for some potential power plant owner/operators that the Proposal’s suggested fifty-year default fixed timeframe for the post-injection site care period is arbitrary and will serve to discourage Owners or Operators of CO2 GS sites from seeking to develop i nnovative ways to safe ly close wells in a shorter time period. Id. at 43519. EPA acknowledges in the Preamble to the Proposal that it is likely "that the actual time for CO2 plume stabilization...will be very site specific, being influenced by geologic factors such as formation permeability, geochemistry, and the degree of capillary trapping." Id. (emphasis added). EPA then goes on to note that the studies used for their preliminary analysis suggest th at the length of time required before plume stabilization ranges from ten to one hundred years af ter cessation of injection - quite a significant range. Id, emphasis added. In the same discussion, EPA reviews a range of sugge sted time periods, acknowledging that even a ten-year timeframe is suggested by some studies. APPA understands that a ten-year site clos ure period may be insufficient in some cases; there is no single time period that would apply to every CO2 GS site

46across the board. Because of the greatly varied geologic characteristics, APPA believes a post closure period of 10 years or until the plume is determined to be stable. Stability is to be defined by the state Director that he/she does not believe that it can harm USDWs. Given th e concerns by the wate r utilities, APPA defers to AWWA for their expertise in this matter. Individual Response: As noted above, EPA disagrees that a post-injection site care timeframe of 50 years is arbitrary. In determining the post- injection site care-tim eframe for the proposed regulation, EPA reviewed industry reports, exis ting environmental programs, and initial GS research studies. EPA provided a synthesis of pe rtinent results from GS modeling studies in the preamble to the proposed regulation. Further expl anation of this analysis was included in an EPA-prepared background document that is available in the federal docket, titled "Computational Modeling of Unde rground Injection of Carbon Dioxide for Determination of Area-of-Review and Potential Risk to Underg round Sources of Drinking Water." Based on review of these studies, modeling results indicate that the CO2 plume stabilization may occur on the timeframe of 10-100 years after the cessati on of injection. While the 10- or 30-year timeframe suggested by some of these commenters may be within the timeframe suggested in some studies, EPA believes that the potential risks of endangering USDWs will likely not decline within these timeframes and available data, including data submitted by commenters, do not support a different default timeframe. However, EPA recognizes that alternative timefra mes may be appropriate under limited, specific circumstances. For this reason, the Class VI rule offers owners or operators flexibility regarding the duration of the PISC timefra me by: (1) allowing the Direct or discretion to shorten or lengthen the PISC timeframe during the PISC pe riod based on site-specific data, pursuant to requirements at §146.93(b); or (2) affording the Director discretion to allow a Class VI well owner or operator to demonstrate, based on substantial data during the permitting process, that an alternative PISC timeframe may be appropria te if it ensures non- endangerment of USDWs pursuant to requirements at §146.93(c). EPA believes that a 50 year pos t-injection site care timeframe represents a reasonable and protective monitoring period and available data, including data submitted by commenters, do not support a different default timeframe. Furthermor e, EPA believes that a 50-year default postinjection site care timeframe, as required at §146.93(b)(1), is not overly burdensome, does not exaggerate the risks associated with GS, is consistent with other environmental programs, and sufficiently protects USDWs from endangerment.

Letter ID: 0169 Comment ID: 23421 Letter Lines: 964 to 1027 ; 1338 to 1339
Comment Code: 1640 1.3.4 CERCLA issues (seeking comment)
Comment: Interaction with CERCLA APPA has been bothered by the risks of CERC LA given the complexities of what can trigger CERCLA and remediation under the statute’s ARARs. (Applicable or Relevant and Appropriate Requirements). A critically important issue on which EPA seeks comment is the interaction of the CO2 GS regulatory program with the

47Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"). While EPA acknowledges that "CO2 itself is not listed as a hazardous substance under CERCLA," the Agency ra ises the specter of potential CERCLA liability if the CO2 stream contains other CERCLA hazardous constituents (e.g., mercury), or if other hazardous constituen ts are formed when the injected CO2 stream reacts with groundwater (e.g., sulf uric acid). Id. at 43504. As EPA can surely appreciate, the potential for open-ended CERCLA liability for any contamination resulting from CO2 GS activ ities will act as a serious deterrent to would-be Owners or Operators of Cl ass VI wells and could jeopardize the contemplated wide-spread commercial de ployment of CO2 GS operations. CERCLA liability would be the ultimate disincen tive for commercial deployment. APPA believes that Congress will need to act to correct this risk before commercial deployment should be expected. APPA’s white paper on CERCLA issues by Marianne Horinko, former Acting EPA Administrator, and career policy senior manager at the U.S. EPA on CERCLA and other waste matt ers address these points. That paper is found in the Appendix. [FN8] [See EPA- HQ-OW-2008-0390-0169.pdf for this document.] EPA correctly acknowledges that CERCLA’s "fed erally permitted release" exemption will provide CERCLA protection from those "releases" that fall within the scope of a Class VI permit (e.g., contained with in the Area of Review ("AoR")), but the Agency also recognizes the limitations of this exemption, as it does not offer protection for any release of a hazar dous substance that is out the scope of the Class VI permit (e.g., outside the AoR). Indeed, EPA states that any permits will have to "be carefully stru ctured to ensure that they do not 'authorize' inappropriate hazardous rel eases," including "potential releases from the well which are outside the sc ope of the Class VI permit." Id. APPA appreciates that the contamination issue is extremely important and should be addressed in the Final Rule. However, we have no reason to believe that the technology and safeguards developed to preven t migration of injected CO2 or its constituents will fail. At the same tim e, the specter of open-ended CERCLA liability will impede the ability of Owners or Operators to calculate and demonstrate financial responsibility, obtai n financial assurance, and obtain the initial capital necessary to invest in this important technology. Simply put, EPA (and Congress) must mitigate the threat of potential CERCLA liability to the extent possible in this rulemaking. One step that the Agency can take is to ensure that final Class VI permits for individual CO2 GS projects have the broa dest possible reach - while remaining protective of USDWs - to maximize the protection offered by the Federally Permitted Release exemption. This would m ean including in the scope of the permit for CO2 injection all other CERCLA hazardous constituents likely to be contained in the CO2 stream, including those generated during capture and transport as well as any that could be fo rmed in the injection zone as a result of the injection of CO2. Si milarly, the scope of the au thorized "permit zone" should be as broad as possible while rema ining protective of US DWs. This could

48mean, for example, effectively authorizing the migration of constituents contained in the CO2 stream (or resulting from injection) outs ide the scope of the AoR, provided that such migration does not directly impact a USDW. The bottom line is that the potential fo r unlimited CERCLA liability must be mitigated to avoid significant delays and an overall chilling effect for geosequestration. APPA recognizes that while there are some measures the Agency can take in the regulatory context to address this concern, including those described above, those measures may be lim ited. In the end, APPA believes that a legislative solution is critical to elim inate this liability concern. APPA recommends that the EPA strongly support such a broader liab ility solution and communicate that support to Congr ess at the appropriate time. [FN8]Marianne Horinko "Carbon Capture and Sequestration Legal and Environmental Challenges Ahead," August 2007 Individual Response: The Agency thanks the commenter for their detailed comments regarding the scope and possible impacts of CERCLA liability on CCS activities, and in particular comments related to the CERCLA exemption for federally-permitted releases. EPA notes that the GS rule is not promulgated under CERCLA, therefore the applicability of th at statute will not be determined under the SDWA or the terms of the GS rule, but rather according to the CERCLA statute itself and any implem enting regulations that may apply. As described above, whether the release of any hazardous substances in the CO2 may result in CERCLA liability from a seque stration facility depends enti rely on the composition of the specific CO2 stream and the environmental medi a in which it is stored (e.g., soil or ground water). CERCLA exempts from liability, under CERCLA section 107, 42 U.S.C. 9607, certain “federally permitted releases” as defined in CERCLA, 42 U.S.C. 9601(10). Class VI permits will need to be carefully structured to ensure that they prevent potential releases from the well which are outside the scope of the Class VI permit. Comments recommending that EPA support legislation for purposes of creating a broader liability framework for GS are outsi de the scope of this rulemaking.

Letter ID: 0169 Comment ID: 23422 Letter Lines: 1086 to 1089
Comment Code: 4490 2.4.5 Use of tracers and potential im pact on human health or ecosystems (seeking comment)
Comment: Tracers - If the state Director believes th at tracers are needed, we encourage the least cost tracer be selected from th e most effective options. EPA correctly notes that some drawbacks can accompany the use of tracers, including the possibility of false positives. Id. at 43512-13. Individual Response: EPA agrees that the use of tracers shoul d not be required at all GS sites, but should be available as an option. For this reason, EPA does not require the use of tracers at

49all GS sites; however, the Director has discretion to require their us e if he/she determines that the use of tracers could improve monitoring of the site and enhance USDW protection from endangerment. The rule will also allow their use if proposed by the owner or operator and approved by the Director. EPA adds that, if tracers are wa rranted at a site, the specific tracers to be used would be described in the testing and mon itoring plan, which the Director w ould evaluate in the context of other information about the GS s ite. The Director would assess the use of tracers in the context of site-specific information, including risks to USDWs.

Letter ID: 0169 Comment ID: 23423 Letter Lines: 1091 to 1097
Comment Code: 4650 2.6.5 CO2 plume and pressure fr ont tracking (seeking comment)
Comment: Plume and pressure front monitoring- Because of APPA’s inextri cable link to the municipal water utilities, we fully appreciate the importance of accurate monitoring of the plume and pressure front . Id. at 43514. APPA defers to AWWA to comment on monitoring and frequency of m onitoring requirements. APPA believes that most early projects will likely monitor far more often than will be unnecessary as more information is gained regarding the accuracy of initial modeling. Individual Response: EPA agrees with commenters on the im portance of monitoring at GS sites and emphasizes that monitoring of injection activ ities will be an important component of every GS project. Monitoring associated with injecti on wells and the movement of the CO2 plume is necessary to verify that the injectate is confin ed in the target formations and does not endanger USDWs. EPA believes that monitoring data should be used to review model assumptions, verify computational model projections, and, when nece ssary, provide input for model refinements. As data are collected at an injection site, model pa rameters can be adjusted to match observations (i.e., for model calibration or), which in turn impr oves the predictive capabil ity of the model. As a GS project proceeds, both monitoring and modeling will evolve, with monitoring results supporting effective AoR reevalua tions and leading to improved model predictions and changes to an owner and operators te sting and monitoring plan.

Letter ID: 0169 Comment ID: 23424 Letter Lines: 1099 to 1108
Comment Code: 5400 2.9 Proposed Financial Respons ibility and Long-Term Care Requirements
Comment: Financial Responsibility APPA supports EPA’s suggesti on to issue guidance in the future for clarification of the financial responsibili ty mechanisms available for Owners or Operators of

50CO2 GS wells. Id. at 43520-22. Provided th at such guidance is issued in accordance with OMB’s Good Guidance Manual, APPA believes that such guidance could be particularly helpful as the Program advances and industry and regulators gain experience and knowledge related to CO2 GS projects. APPA believes it is far too soon to offer si gnificant comment on this aspect of the proposed rule. Individual Response: EPA is developing guidance on financ ial responsibility for GS wells. EPA plans to take OMB's Good Guidance Manual in to advisement as financial responsibility guidance is developed. OMB's Good Guidance Manua l establishes policies and procedures for the development, issuance, and use of signi ficant guidance documents by Executive Branch departments and agencies. See the final rule a nd preamble for further discussion of EPA's final approach to financial responsibility.

Letter ID: 0169 Comment ID: 23425 Letter Lines: 1110 to 1119
Comment Code: 5434 2.9.1.2 Need for additional instruments (seeking comment)
Comment: APPA would like to see that the final rule accommodate a range of options including self-insuran ce instruments remain available to Owners or Operators as a method of financial assurance for Cla ss VI CO2 GS projects. Id. at 43521. Self-insurance instruments, including th e corporate financial test and the corporate guarantee, have been ut ilized successfully under RCRA over two decades. However, APPA must acknowledge that the volume of CO2 and the length of operations would suggest that the UIC Cla ss VI wells will be different. As EPA mentions in the Preamble, the assessment by the Environmental Finance Advisory Board ("EFAB") of various financial res ponsibility issues re vealed no specific failures of the corporate financial test. Id. Individual Response: EPA will retain self insurance as an option for financial responsibility for Class VI wells. EPA believes that if properly used, the financial te st can be an appropriate option for some owners or operators. EPA recognizes that it is important for sel f-insurers to be creditworthy, otherwise USDWs may not be adequately protected. Owner or operators who choose to self-insure and use the financial test must be ab le to demonstrate profit ability, with a margin sufficient to cover contingencie s and unknown obligations, and stab ility. If the owner or operator meets corporate financial test criteria, this is an indication that the owner or operator can guarantee its ability to satisfy fi nancial obligations based solely on the strength of the company’s financial condition. If an operator or operator is not able to meet the corporate financial test criteria may arrange a corporate guarantee by dem onstrating that its corporate parent meets the financial requirements on its behalf. EPA is developing guidance that describes the types of financia l instruments, including self insurance, which owners or operators can use to meet financial responsibility requirements for GS wells. This guidance will be available on EPA's website at http://water.epa.gov/type/groundwat er/uic/wells_sequest ration.cfm. The financial responsibility

51guidance will include consideratio ns for Directors regarding how to evaluate the appropriateness of a specific financial responsibility in strument for a specific project.

Letter ID: 0169 Comment ID: 23426 Letter Lines: 1121 to 1132
Comment Code: 5436 2.9.1.3 Allowing separate financial demonstrations for plugging and abandonment and post-injection si te care (seeking comment)
Comment: APPA is comfortable with the Proposal’s suggestion to allow se parate financial responsibility demonstrations for diffe rent phases of CO 2 GS projects, specifically for well plugging and then pos t-injection site car e. Id. at 43522. As EPA recognizes, "post-injection site care has the potentia l to extend many years into the future," and "[t]rying to determine the cost for post-injection site care...could be difficult, as c ould the approval of a financial demonstration." Id. Requiring all financia l demonstrations to be completed at one time, prior to well plugging, could unnecessarily delay the site closure process. Allowing a subsequent demonstr ation for financial responsibility for the post-injection site care period will allow regulators and Owners or Operators to better understand the site-closu re needs for a given CO2 GS project prior to demonstration and approva l of financial responsibility. Individual Response: EPA will allow owners or operators to use separate financial responsibility instruments for well plugging and site closure. Howeve r, owners or operators must demonstrate adequate financial responsibility fo r injection well plugging and post-injection site care and site closure with their permit applic ations per §146.85(a). This will ensure that resources are available to prevent the endangerm ent of USDWs in the event that the owner or operator experiences financial difficulties at a ny time during the life of the GS project. In addition, financial responsibility will need to be reevaluated and updated as needed prior to well plugging or site closure, or at any other time deemed appropr iate by the Director (e.g., if the Director determines that based on information a bout the site, additional financial resources are needed to protect USDWs). EPA is developing guidance on financial responsibility for Class VI wells. The guidance will include a discussion on how best to estimate costs to assist Class VI well ow ners or operators in developing estimates of the costs associated with various GS activities. The guidance will include considerations, such as risk, that suppor t accurate cost estimates. In addition, the final regulation at §146.85(e) requires th e owner or operator to prov ide annual updates to the cost estimates to account for any amendments to th e AoR and corrective acti on plan, the injection well plugging plan, the PISC and site closure plan, and the emergency and remedial response plan. This guidance will be available on EPA's website at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

Letter ID: 0169 Comment ID: 23427 Letter Lines: 1134 to 1139
Comment Code: 5460 2.9.2 Comments on transfer of lia bility for long-term care

52Comment: APPA urges EPA to actively pursue a legisl ative solution to the liability issue. APPA does not yet have the legislative solution in mind to address long-term liability under RCRA, CERCLA, Natural Re source Damage Assessment (NRDA) and other state laws but we know that consider able effort will have to be made to enable power plants to comfortably en ter into these comm ercial activities without unlimited environmen tal or tort liability. Individual Response: Under the final GS rule, once an owne r or operator has met all regulatory requirements under Part 146 for Class VI wells and the Director has approved site closure pursuant to requirements at §146.93, the owner or opera tor will generally no longer be subject to enforcement for regulatory noncompliance. Furtherm ore, their financial instrument as required under §146.85 will be released if it was not used. However, even if a site closure is approved under §146.93, an owner or operator may be held liable for regulatory noncompliance (including violation of 40 CFR 144.12) in ce rtain circumstances. For example, an owner or operator may be held liable for regulatory noncompliance even afte r site closure was approved if the Director relied on erroneous information (e.g., erroneous modeling data) provid ed by the owner or operator when approving site closure. Separate from EPA’s authority to enforce regul atory compliance, an owner or operator may be subject to a §1431 response orde r even after proper site cl osure is approved under §146.93. Under §1431 the Administrator may require an ow ner or operator to take necessary response measures if he or she receives information that a contaminant is present or is likely to enter a public water system or an USDW, which may pres ent an imminent and s ubstantial endangerment to the health of persons, and the appropriate Stat e and local authorities ha ve not acted to protect the health of such persons. Th e action may include issuing admi nistrative orders or commencing a civil action for appropriate relief against the ow ner or operator of a Class VI well. If the owner or operator fails to comply with the order, they may be subject to a civil penalty for each day in which such violation occurs or failure to comply continues. Furthermore, after site closure an owner or ope rator may remain liable under tort and other remedies, or under other federal statutes includi ng, but not limited to, Clean Air Act, 42 U.S.C. §§ 7401-7671; CERCLA, 42 U.S.C. § 9601-9675; and RCRA, 42 U.S.C. § 6901-6992. EPA does not have authority to transfer SDWA or other legal liability for Class VI wells to the State or federal government or a third-party fund. See the final rule preamble for further discussion of EPA's final approach. Comments requesting EPA to pursue amendments to legislation related to liability are outside the scope of this rulemaking. This is also tr ue to comments related to tort liability.

Letter ID: 0169 Comment ID: 23428 Letter Lines: 1141 to 1153
Comment Code: 5500 2.1 Comments on Involving the Public in Permitting Decisions
Comment: Public Participation

53APPA agrees that public participation is crucial to the success of any individual CO2 GS project and of the UI C Program as a whole. Id. at 43523. We urge EPA to structure the Final Rule’s public participation requirements to maximize impact without unnecessarily slow ing down the application process. To this end APPA believes that public partic ipation would prove mo st useful after an application has been deemed complete bu t before it has been approved. APPA is inclined to believe that the states will set up public participation requirements consistent with their exis ting proposed new plant operations. APPA does not want the EPA UIC Class VI rulemaki ng to add new steps for permit review or hearings but offers no Federal pr e-emption of existing state public participation requirements. Individual Response: The Agency believes that public particip ation is an important part of the UIC permitting process and wants to ensure wi de access to decision-making processes and information on projects. GS permitting authorities must follow the existing public participation requirements for UIC permits as specified in 40 CFR Part 124. These regulations lay out the procedures for decision making and include requirements such as re quiring the Director to notify the public regarding the availabil ity of the draft permit and allow him or her to request a public hearing on the draft permit. EPA encourages operators and permitting agencies to begin involving the public by providing info rmation as early in the pro cess as possible. Encouraging public participation allows the permitting authority to underst and public viewpoints, preferences, and concerns about the project, which might he lp avoid public misperceptions about the nature and safety of GS projects and forestall resistance later in the permitting effort. EPA disagrees with commenters who claim th at early public involvement may slow the application process. Encouraging public part icipation allows the permitting authority to understand public viewpoints, preferences, and con cerns about the project, which might help avoid public misperceptions about th e nature and safety of GS projects and forestall resistance later in the permitting effort.

Letter ID: 0169 Comment ID: 23429 Letter Lines: 1160 to 1168
Comment Code: 3300 2.2.1 Delineating the AoR/M odeling CO2 movement
Comment: to use geologic sequestration in a very responsible manner. First, many states have not conducted modeling on groundwater use and availabity in decades, and the earlier modeling may have used outdat ed models and information. In non-oil and gas states (or perhaps some mining st ates) there is little known about the subsurface geology. While APPA greatly appreciates the maps and placement analysis modeling conducted by U.S. Geol ogical Service or "USGS", Batelle, NETL/DOE and others. We do not belie ve that we have preliminary characterizations or pre-co mmercial data as to under ground formations suitable for injection and long-term storage of CO2. Nor do we know what the storage Individual Response: EPA acknowledges that some states do not have much geological and hydrogeologic data. For this reason, it is importantthat owners or operators gather new site54specific data and conduct new modeling for each GS project. The Agency believes that AoR delineation using computational modeling that accounts for the multiphase flow of CO2 and native fluids (i.e., naturally occurring salty water), including dens ity-driven flow (i.e., buoyancy), is necessary to ensure protection of USDWs from endangerment. The computational models used for this purpose are required to pr edict the fate of injected CO2 and changes in formation pressure. EPA believes that the re quirements at 146.84(c)(1) to delineate the AoR using computational modeling are appropriate and encompass the significant processes that could affect the location of th e CO2 plume and associated pre ssure front. Models can predict CO2 fate and transport, as well as changes in formation pressure, in three dimensions, as a function of time in order to delineate the subs urface storage site and the AoR. Models can account for site-specific and pred icted operating conditions as we ll as geologic heterogeneities and potential migration through faults, fr actures, and artificial penetrations. EPA has evaluated technical documents regardin g several computational models that may be used for GS sites. Based on this review (as docum ented in the AoR section of the preamble to the proposed GS regulation and the backgr ound document "Computational Modeling of Underground Injection of Carbon Dioxide for De termination of Area-of-Review and Potential Risk to Underground Sources of Drinking Water"), EPA believes that several models meet the minimum requirements for models in the GS regulation.

Letter ID: 0169 Comment ID: 23430 Letter Lines: 1168 to 1203
Comment Code: 1800 1.4 Scientific Background/Informing the Proposal
Comment: for injection and long-term storage of CO2. Nor do we know what the storage capacity is for those geologic formations given the volume of CO2 from power plants. We believe that DOE’s regional sequestration pilots, USGS, and other agencies can help the EPA and state agen cy directors in better characterizing these formations and ruling out transmi ssible faults, historically abandoned wells or mines, or poorly closed oil/gas operations from the 1930s where the well was closed with very poor closure mechanisms that would not prevent seepage. These formations that need to be considered by these agencies include deep saline formations, since we believe that most oil and gas formations will be saturated with CO2 in the first few y ears of broad commercial deployment. Oil and gas states have had motivation to keep up with subsurface mapping and preliminary characterization of the geol ogy and hydrology because of the revenue streams from oil/gas sales and taxes back to the states. Stat es will need to provide much clearer preliminary characteri zations of the subsurface before this technology is commercially deployable becau se even the most modest subsurface characterization in a deep saline aquifer can take millions of dollars. Many power plant owner operators will hesitate to undertake such studies in non oil and gas states. APPA encourages the state agencies to use the available training and resources from USGS. EPA and state agen cies should also become familiar with and be trained to use the SEQURE program , licensed by the Department of Energy’s NETL program. SEQURE is an aerial methane detection program which can be used in each state to identify abandoned or or phaned oil and gas wells, mines, and

55perhaps other subsurface faults that coul d inadvertently lead to leakage and ultimate risks to USDWs. Other programs may be appropriate in addition to SEQURE. APPA does not intend to close the do or to other modern ways to better characterize drinking water resources and the surrounding geology but we encourage the use of SEQURE. We defer to our colleagues at the American Water Works Association, the AWWA Research Found ation (AwwaRF), and th e Association of Metropolitan Water Agencies who might offe r other insights as to what else is needed. Further, APPA encourages state di rectors to communicate in substantives ways with the state hydrologist or geol ogist. Many states have not had any motivation to review subsurface geology in many decades. Updating maps and ruling out areas with faults or other un intended methods of conveyance for CO2 migration will be essential to make this program work. APPA encourages the U.S. EPA and states to meet with USGS to disc uss other tools available to the EPA and to states agencies. Individual Response: As discussed previously, EPA conti nues to fund and track research on geology as it relates to CCS. Info rmation about this research is available on EPA's safewater website and ORD's web site. In response to the comment regarding the amount of data available on the subsurface geology of states that do not produce oil or gas, EPA cl arifies that the permitti ng requirements at §146.82 require an extensive evaluation of the geologic c onditions at a proposed GS site to demonstrate the suitability of a potential project site for GS. If adequate maps and cross sections do not exist to support a thorough evaluation of the site, the owner or operator must produce the information (e.g., through additional, new studies), and the Di rector has the authority to request additional information under §146.82(a)(21). EPA also agrees with the commenter that communication among knowledgeable staff, such st ate hydrologists or geologists, is important to ensure that USDWs are protected. EPA encourages such comm unication wherever appr opriate or necessary so that the Director will have all of the information needed to support permitting decisions. Regarding the use of SEQURE to identify abandone d wells, EPA notes that owners or operators may propose to use whatever methods they c hoose to support the Ao R and corrective action process required at §146.84, as long as they are ap proved by the Director as part of the AoR and corrective action plan. Please see EPA's AoR and corrective action guidance, available on EPA’s website at http://water.epa.gov/type/groundwater /uic/wells_sequestrati on.cfm, for additional information.

Letter ID: 0169 Comment ID: 23431 Letter Lines: 1205 to 1208
Comment Code: 5800 2.13 Comments on emergency and re medial response (40 CFR 146.94)
Comment: Leaks and response plans APPA believes that the owner/operator must take remedial action as described in the permit’s response plan.

56Individual Response: EPA agrees that an emergency and reme dial response plan is an important part of assuring protection of USDWs from endangerment at GS sites. The requirements for an emergency and remedial response plan at §146.94(a ) are designed to ensure that owners or operators, as part of their permit applications , comprehensively plan what actions would be necessary in the unlikely event of an emergency. Th e plan will ensure that operators know what entities and individuals must be notified and what actions must be taken to expeditiously mitigate any emergency situations.

Letter ID: 0169 Comment ID: 23432 Letter Lines: 1210 to 1217
Comment Code: 4600 2.6 Proposed Plume and Pressure Front Monitoring Requirements (40 CFR 146.90)
Comment: Monitoring APPA does not have great expertise in m onitoring in GS commercial settings. However, it makes common sense to place mon itors close enough to detect the leak before it can negatively affect the USDW . APPA realizes that some local jurisdictions may require surface monitori ng or that OSHA may require surface monitoring for safety purposes. However, we doubt that surface monitoring would do much to protect USDWs. Individual Response: Baseline characterization of the site , including the geochemical data and initial modeling, will be highly valuable in select ion of monitoring well locations and in refining plans for monitoring frequency. The GS rule stipul ates that the monitoring frequency and spatial distribution of monitoring wells must be based on baseline geochemical data that were collected during the initial site characterization and the area of re view evaluation at §146.90(d)(2). The details of the geochemical monitoring will be based on site-specific information and described in the Director-approved testing and monitoring plan. The Agency believes that surface air and soil ga s monitoring, when coupled with subsurface monitoring, may be appropriate at some GS projects to ensu re USDW protection. EPA also acknowledges that surface air a nd soil gas measurements are subj ect to variabili ty and may not be suitable in all settings as a method to ensure USDW protection. However, EPA does not believe that this should entirely preclude thei r use. The decision to use surface monitoring and the selection of monito ring methods will be site-specific (e.g., may be influenced by geology, injection depth, and operational conditions) and must be based on poten tial risks to USDWs within the AoR.

Letter ID: 0169 Comment ID: 23433 Letter Lines: 1219 to 1228
Comment Code: 1300 1.1.2.3 Comments on other aspects of CCS (capture, transport)
Comment: Electricity Reliability

57While the EPA UIC Class VI program pe rmitting proposed rule did not call for comments on electricity re liability, we offer our comments to NERC on Reliability Impacts of Climate Change In itiatives, dated July 16, 2008, which we believe should be considered. These are included in the Appendix. [See EPA-HQOW-2008-0390-0169.pdf for these comments.] NERC’ s "Reliability Impact of Climate Change Initiatives" (Nov. 2008) link is: http://www.nerc.com/files/2008-Climate-In itiatives-Report.pdf to the final report (23pp). Individual Response: As described above, the capture and tr ansport of CO2 are not within the UIC program’s authority. The UIC program’s au thority under the SDWA focuses on ensuring that Class VI GS projects are permitted, sited, co nstructed, operated, monitored, and closed in a manner that protects USDWs from endangerment.

Letter ID: 0169 Comment ID: 23434 Letter Lines: 1230 to 1234
Comment Code: 7300 4.3 Regulatory Flexibility Act
Comment: EPA to Consider SBREFA Impacts
APPA asks that the U.S. EPA consider APPA’s comments under Small Business Regulatory Enforcement and Fairness Act (S BREFA) since > 90% of APPA’s member utilities meet the thresh old for small entities. Individual Response: Based on a review of all of the Ex ecutive and Statutory Orders, EPA has determined that the GS rule is not subject to the requirements of Regulat ory Flexibility Act and SBREFA. This conclusion is based on the scope of the GS Rule, wh ich affects only those entities that choose to engage in GS. EPA clarifies that the GS rule does not require a ny facilities to sequester CO2; nor does it create an economic incentive to do so. The purpose of the GS regulation is to ensure that, where deployed, GS is conducted in a manner that does not endanger USDWs.

Letter ID: 0169 Comment ID: 23435 Letter Lines: 1236 to 1240
Comment Code: 7100 4.1 Executive Order 12866: Regulatory Planning and Review
Comment: Executive Order 12866
APPA asks that the U.S. EPA consider APPA’s comments and NERC’s study under Executive Order 12866 and any future Execu tive Orders on energy expressed by President-Elect Obama which covers energy issues. Individual Response: EPA determined that the final GS rule is a "significant regulatory action,” under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993), because GS will raise novel

58legal or policy issues. Accordingly, EPA submitted this action to the Office of Management and Budget (OMB) for review under EO 12866. Any changes made in response to OMB recommendations are documented and are provided in the rulemaking docket.

Letter ID: 0169 Comment ID: 23436 Letter Lines: 1244 to 1256
Comment Code: 1000 1. General and Administrative Comments
Comment: APPA appreciates the opportunity to comment on this important rulemaking initiative and looks forward to working w ith EPA on this effort. APPA has also filed comments on the EPA ANPR in respons e to many questions that the EPA has asked on geologic sequestration. It is critical that th e EPA’s air, water and policy offices understand that while A PPA will offer reasons why geologic sequestration should not be presumed to be Clean Air Act te chnological choices under MACT, BACT, LAER, or for NSPS complia nce etc., we do strongly want the U.S. EPA to have a Class VI regulator y system that would allow for these demonstration (and later commercial scale pl ants) plants. APPA would be pleased to meet with the EPA regarding these issu es. We would additionally be pleased to include in any EPA meeting our partners, the American Water Works Association (AWWA) which represents the public and priv ate water utilities who have "front line" drinking water protection obligations. Individual Response: EPA acknowledges the comment. Pleas e see the remainder of EPA's responses to this comment for further deta ils. For additional information on EPA's final regulatory approach, please see the final rule and preamble as well as the rulemaking docket. EPA clarifies that technologies considered under Clean Air Act re gulations are outside the scope of the GS rulemaking. Rather, th e purpose of the GS regulation is to ensu re consistency in permitting underground injection of CO2 at GS operations across the United States and provide requirements to prevent endangerment of USDWs in anticipation of the eventual use of GS to reduce CO2 emissions. Please see the discussion, “How Does This Rulemaking Relate to the Greenhouse Gas (GHG) Reporting Pr ogram?” in the preamble.

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