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.December 24, 2008

Environmental Protection Agency

Water Docket, Mail code: 2822T 1200 Pennsylvania Avenue, NW Washington, DC 20460

Attention Docket ID No. EPA-HQ-OW-2008-0390 Submitted on-line at: www.regulations.gov

Subject: 40 CFR Parts 144 and 146 – Federal Requirements Under the Underground Injection Control (UIC) Program for Carbon Dioxide (CO 2 ) Geologic Sequestration (G S) Wells; Proposed Rule

To Whom Concerns:

On July 25, 2008, the Environmental Prot ection Agency (EPA) published in the Federal Register, a proposed rule set ting forth new requirements under the Safe Drinking Water Act (SDWA) for the underg round injection of carbon dioxide (CO2) for the purpose of long-term storage, or ge ologic sequestration (GS). The regulation is proposed under the author ity of the SDWA to ensure protection of underground sources of drinking water from injection related activities. EPA views the capture and injection of CO2 produced by human activ ities for long-term storage as one of a portfolio of options that can reduce CO2 emissions into the atmosphere and help mitigate climate change.

WEST Associates (Western Energy S upply and Transmission Associates, or “WEST”) respectfully submits its co mments and recommendations, herein.

WEST Associates is comprised of 16 inve stor and publicly owne d electric utilities serving the rapidly growing 11 western stat es and North Dakota. In recent years,

WEST Associates has worked with other stakeholders to advocate development of environmental laws and regulations that are based on sound science and achieve state and national environmental goals in a rati onal and cost effective manner. WEST Associates’ members own and operate coal a nd gas-fired electric generating facilities

and are also involved in th e planning and development of additional new electric generating facilities.Attention Docket ID No. EPA-HQ-OW-2008-0390

December 24, 2008 Page 2

WEST Associates Policy Comments:

WEST’s comments on this rulemaking address EPA’s proposed Alternative 3 which would create a new class of injection wells (Class VI) and proposes minimum technical criteria for geologic site characterization, fl uid movement, area of review (AoR) and corrective action, well construction, operation, mechanical integrity testing, monitoring, well plugging, post injection site-care, and site closure for the purposes of protecting underground sources of drinking water (USDWs). The proposal is based on the ex isting Underground Inje ction Control (UIC) regulatory framework, with modifica tions to address the unique natu re of CO2 injection for GS.

WEST's comments set forth seve ral policy level concerns an d recommendations, followed by

some comments and recommenda tions concerning the specific aspects of the proposed rulemaking.

Among WEST Associates' membersh ip, coal-fired generation cons titutes a significant proportion of electrical generation resources for the western states, and the na tion as a whole relies on more than 50% of its generation from coal-fired power plants. Demographic growth in the western states has been, and likely will continue to be, grea ter than the rest of the U.S.; as a result, coal generation and the potential need to abate it’s growing CO2 emissions will require effective options such as GS. Clearly, as the nati on embarks on programs to reduce greenhouse gas (GHG) emissions to achieve it's climate change goals, the option of car bon sequestration through under-ground injection wells must be a significant part of the CO2 emissions abatement program for fossil fuel generation. In its preamble to this rulemaking, EPA notes that the UIC Program and GS are "one of a portfolio of options" for successful abatement of CO2 emissions to the atmosphere.

WEST generally supports a well-designed a nd cost-effective nati onal program for CO2

abatement, and believes that some of the featur es of the Lieberman-Warner Bill (S.2191) present a fair start for negotiating a workable program in Congress. Indeed, EPA estimated in its review of S.2191 that Carbon Capture and Sequestration (CCS) technology could account for about 30% of CO2 emissions reductions sought by year 2050 under that bill. Notably, the 11 western states where WEST members reside and produce electr icity, the regional geology, geography and its demographics in the vast spaces of the West may provide unique seque stration opportunities in general proximity to abundant coal supplies and coal powered generating plants. National legislation and regulatory developments such as this one on UIC of CO2 for GS, should remove legal and institutional barriers that prevent the development and use of carbon capture and storage/sequestration technologies . That is, the design of a UI C/GS regulatory program should promote efficient and simple regulation wit hout redundancies with ot her regulations, yet maximize protection of underground sources of dri nking water ("USDW"), a nd the public health and safety above ground.

WEST Associates Comments on the Proposed Rule

The following are WEST's comments on the Preamble and proposed rule, which we believe will clarify and streng then the proposal:Attention Docket ID No. EPA-HQ-OW-2008-0390

December 24, 2008 Page 3

♦ Under the proposed UIC regulation, siting UIC wells for GS in the west will likely involve a challenging set of national agencies, states, a nd tribal sets of re gional and sub-regional regulation that will requ ire streamlining in order to site UI C wells and pipelines to transfer super critical CO2 to GS sites located at some distances away from coal fired power plants. Such projects will cross over many jurisdicti ons and involve a patchwork of regulatory requirements. This will require coordination among federal and tr ibal jurisdictions since it is highly likely that most western projects will impact federal lands, including tribal lands. EPA should immediately start working toward s building support and consensus among the federal land managers and BIA fo r the UIC regulatory program.

♦ EPA needs to design the UIC program to facilit ate GS sites that can be utilized by many individual power plants that may not have r eady access to geologically suitable GS sites in proximity to such plants. What will be needed is state, tribal a nd federal cooperation to develop regional storage sites that could accomm odate CO2 from sources in several states. Development of such regional storage sites would allow critically needed sharing pore space in states that have the most favorable geology.

♦ EPA needs to build a practical realism into the site characterization UIC regulatory requirements under the SWDA. The current rule proposal is so "demanding" it may preclude many otherwise eligible geological storage site s. The site characterization and related requirements for permitting a UIC well present a very large list of extremely detailed potential impact issues that by themselves may be frightening to members of the public. This evaluative process needs to be pared down to t hose most critical few factors that assure the greatest degree of safety for each unique UIC for CO2 GS site. WEST members do not want to see development of a regulatory program that gets so bogged down that it goes no further than the nuclear waste storage siting fiasco in the US (e.g., the Nevada nuclear storage site is still not approved by the state and is caught up in unrealistic public fear and political concerns). If this happens to UIC for CO2 GS siting, it could stop the coal fired power plant industry if CCS becomes one of a very few limited options for CO2 emissions abatement required under a GHG legisla tive or regulatory program.

♦ WEST urges EPA to avoid utilizing risk ma nagement approaches that discourage CCS development. WEST strongly believes that regu latory certainty is crucial, if meaningful investment is going to flow to CCS technologi es and deployment. Certainty needs to be brought to long-term obligations, lia bilities and risks associated w ith GS projects. To assist in this regard, EPA should set a limit of 50 years in the future for liabilities to GS project owners and operators. Extending this limit beyond 50 years may severely limit financial investments in CCS projects. Post injection monitoring and fi nancial assurance requirements are important, but need to be tailored to com port with the potential risks, which decrease significantly after injection is complete.

♦ Nevertheless, WEST believes an efficient and effective liabilit y insurance program should be developed for UIC GS site developers and owne rs to avoid what otherwise will be a veryAttention Docket ID No. EPA-HQ-OW-2008-0390

December 24, 2008 Page 4

large disincentive for project developers to co nstruct the significant amount of GS capacity

that will be needed to meet the goals of a national GHG emissions abatement program such as what S.2191 portends. The utility electric power industry is familiar with the model offered by the nuclear power industry as regulat ed by the NRC. WEST believes that because of the very low probability of catastrophic re lease of stored CO2, but because of the extremely high potential risk of harm to the pub lic in the unlikely event of a catastrophic release, a Liability Model patterned after th e principles laid out in the "Price-Anderson Nuclear Industries Indemnity Act of 1957" may be workable in this instance. This Liability Model is comprised of three elements:

1. Site-specific private insurance,

2. Industry-wide pooled insurance, and

3. Federal indemnity as the insurance of last resort.

♦ WEST urges EPA to take appropriate care in characterizing the risks of CO2 geologic storage under the UIC program. As we commented above, a successful national CO2 emissions abatement program will necessarily n eed to rely heavily upon development of and public support for CCS. By overly burdening the detail of site charact erization and UIC of CO2 risks related to given sites under consideration, EPA could inadvertently and inappropriately stigmatize CCS, particularly if it heads off into an unw arranted categorization of CO2 as a pollutant or a hazardous waste. Such excessive focus on risk or inappropriate characterization would imply liability risk that would chill further development of critically needed CCS under a climate change program. WEST Associates believes EPA can develop site characterization regulations that minimi ze potential burdensome regulations based on known potential site characteristics as discusse d in these comments immediately below.

♦ EPA should apply a tiered set of site charac terization requirements based on demonstrable and known site characteristics. For example, potential sites that are deep saline formations

located more than one kilometer below the surface are generally recognized as among the

most favorable and secure site options for assuring public safety. 1 If such sites do not have a USDW aquifer located between it and the ground surface above, a more streamlined regulatory site characterization a nd risk review may be appropriate. On the other hand, an example of a potential site that may require a more rigorous site ch aracterization and risk assessment are "sole source aquifers" which are a quifers that are a sole supply of water for a region and are critically important to protect. Some stakeholde rs may assert that there should be no CO2 storage above or below a sole source, aquifer. However, such a restriction would essentially prohibit storage in many western areas. Rather, a better approach would allow EPA to permit UIC Class VI wells in areas wh ere it can be shown that there are sufficient caps and protections to prevent the migration of CO2 in overlying aquifers, even in proximity of aquifers designated as sole source. An early detecti on-monitoring program could be established to provide sufficient opportunity to mitigate any unlikely release of CO2 from the

1 See EPA's VEF-Technical_Document_072408 , pg. 6.Attention Docket ID No. EPA-HQ-OW-2008-0390

December 24, 2008 Page 5

geologic storage unit. Approaches like th is illustrate how EPA can streamline UIC regulations for site characterization and permit UIC Class VI wells that first and foremost protect public safety, yet reflect a workable balance in adapting site characterization and risk assessments based on criteria adapta ble to unique candidate sites.

♦ WEST is concerned about arguments made by some stakeholders th at a whole suite of environmental laws should be applied to CCS projects, including the Comprehensive Environmental Response, Compensation, and Li ability Act ("CERCLA") and the Resource Conservation and Recovery Act ("RCRA"). These laws applied to CCS would impose significant obligations and potential liabilities not only on GS operators, but also potentially

on other entities in the CO2 abat ement chain, such as the power plant operators producing the CO2. This would likely chill technology a dvancement and commercialization of CCS. WEST urges EPA to design the UIC for CO2 GS program to limit CCS projects' liability

under CERCLA and RCRA.

♦ EPA's proposed regulation needs to focus on acc urate site specific characterization of the potential risks posed by geologi c sequestration of CO2 and the UIC program needs to be specifically tailored accordingly to address those identified risks. This will help EPA avoid over generalizing in its regulator y requirements. Too many gene ral default provisions that presume universal application can be problematic. The geol ogic variability involved in different conceivable GS projects needs to be specifically addressed, site-by-site, on issues ranging from site characterizati on to area of review (AoR) to containment requirements. The regulations should encourage si te-specific, performance-ba sed determinations at the permitting stage to handle these specific issues. This approach will work toward practical problem resolution without unduly alarming the pub lic with generalizati ons about potential, but unrealistic risks and problems.

♦ EPA's proposed UIC for CO2 GS rule needs to fu lly respect states' expertise in administering the current SDWA programs. The UIC for CO 2 GS program needs to provide a reasonable process whereby individual states can obtain permitting and compliance primacy over regulation of EPA's proposed Cl ass VI (CCS) wells. Many stat es already administer SDWA programs and a number of states are moving ahead with developing thei r own initiatives and regulations to solve other issues associated w ith CCS. However, EPA will need to consider how to handle projects that span multiple states , tribal lands, and other agency jurisdictions as commented earlier. EPA could establish a primary state in such multiple jurisdiction affected projects, along with a permitting a nd coordination process for permitting purposes would engage other affected st ates in providing for notice and comment by all stakeholders. This same principle may be applied to multiple agency jurisdictions, such as the BLM, the NPS, and other agencies.

♦ Finally, EPA needs to build into this regula tion a "learning and adjustment" process that gains feedback from implementation of the UI C for CO2 GS rule, and establish a periodic review process to make adjustments and correc tions to the rule base d on experienced gained in permitting, operation, and closure of UI C/GS wells. A CCS program of the sizeAttention Docket ID No. EPA-HQ-OW-2008-0390

December 24, 2008 Page 6

anticipated to meet national climate change CO 2 abatement goals is going to create a very large endeavor that is bound to experience diffi culties in its deployment and implementation. EPA needs a ready means to provide regulator y adjustments to reinforce the safety and success of this UIC / GS program as it proceeds in the future.

________________________________

WEST Associates sincerely appreciates this opportunity to comment and provide recommendations on EPA’s proposed rule regard ing UIC for CO2 Geolog ical Sequestration.

Should you have any questions or need further information, please do not hesitate to contact David Steele at (520) 321-1111.

Sincerely,

Kevin Wanttaja, President

Board of Directors

/dssLetter ID: 0248 Commenter: Kevin Wanttaja Organization: Western Energy Suppl y and Transmission Associates

Letter ID: 0248 Comment ID: 22237 Letter Lines: 30 to 66

Comment Code: 1000 1. General and Administrative Comments

Comment: To Whom Concerns:

On July 25, 2008, the Environmental Protection Agency (EPA) published in the Federal Register, a proposed rule setti ng forth new requirements under the Safe Drinking Water Act (SDWA) for the undergr ound injection of carbon dioxide (CO2) for the purpose of long-term storage, or geologic sequestration (GS). The regulation is proposed under the authority of the SDWA to ensure protection of underground sources of drinking water fr om injection related activities. EPA views the capture and injection of CO2 produced by human activities for longterm storage as one of a portfolio of op tions that can reduce CO2 emissions into the atmosphere and help mitigate climate change.

WEST Associates (Western Energy Supply a nd Transmission Associates, or "WEST") respectfully submits its comments and recommendations, herein.

WEST Associates is comprised of 16 investor and publicly owned electric utilities serving the rapidl y growing 11 western states and North Dakota. In recent years, WEST Associates has worked with other stakeholders to advocate development of environmental laws a nd regulations that are based on sound

science and achieve state and national environmental goals in a rational and

cost effective manner. WEST Associates’ members own and operate coal and gasfired electric generating facilities and are also involved in the planning and development of additional new electric generating facilities.

WEST Associates Policy Comments:

WEST’s comments on this rulemaking addre ss EPA’s proposed Alternative 3 which

would create a new class of injection wells (Class VI) and proposes minimum technical criteria for geologic site ch aracterization, fluid movement, area of review (AoR) and correctiv e action, well constructi on, operation, mechanical integrity testing, monitoring, well plugging, post injection site- care, and site closure for the purposes of protecting underground sources of drinking water (USDWs). The proposal is based on the ex isting Underground In jection Control (UIC) regulatory framework, with modificatio ns to address the unique nature of CO2 injection for GS. WEST's comments set forth severa l policy level concerns and recommendations, followed by some comm ents and recommendations concerning the specific aspects of the proposed rulemaking.

1Individual Response: EPA acknowledges the comment. Pleas e see the remainder of EPA's responses to this comment letter for further de tails. For additional information on EPA's final regulatory approach, please see the final ru le and preamble, including sections on site characterization, AoR, construction, operation, tes ting and monitoring, and site closure, as well as the rulemaking docket.

Letter ID: 0248 Comment ID: 22238 Letter Lines: 68 to 80

Comment Code: 1330 1.1.3.1 Support use of GS in general

Comment: Among WEST Associates' membership, co al-fired generatio n constitutes a significant proportion of electrical ge neration resources for the western states, and the nation as a w hole relies on more than 50% of its generation from coal-fired power plants. Demographic growth in the western stat es has been, and likely will continue to be, greater than th e rest of the U.S.; as a result, coal generation and the potential need to ab ate it’s growing CO2 emissions will require effective options such as GS. Cl early, as the nation embarks on programs to reduce greenhouse gas (GHG) emissions to achieve it's climate change goals, the option of carbon sequestr ation through under-ground inje ction wells must be a significant part of the CO2 emissions abatement program for fossil fuel generation. In its preamble to this rule making, EPA notes that the UIC Program and GS are "one of a portfolio of opti ons" for successful abatement of CO2 emissions to the atmosphere.

Individual Response: EPA agrees that GS is one technology in a portfolio of options, including energy conservation, efficiency improvements, a nd the use of alternative fuels and renewable energy sources, that could be deployed to redu ce CO2 emissions. Please see the remainder of EPA’s responses to this comment for further details. For additional information on EPA’s final regulatory approach, please see the final rule and preamble as well as the rulemaking docket.

Letter ID: 0248 Comment ID: 22239 Letter Lines: 82 to 98

Comment Code: 1330 1.1.3.1 Support use of GS in general

Comment: WEST generally supports a well-designed a nd cost-effective nati onal program for CO2 abatement, and believes that some of the features of the Lieberman-Warner Bill (S.2191) present a fair start for negotiating a workable program in Congress. Indeed, EPA estimated in its re view of S.2191 that Carbon Capture and Sequestration (CCS) technology could account for about 30% of CO2 emissions reductions sought by year 2050 under that bill. Notably, the 11 western states where WEST members reside and produ ce electricity, the regional geology, geography and its demographics in the vast spaces of the West may provide unique sequestration opportunities in general pr oximity to abundant coal supplies and coal powered generating plants. Nati onal legislation and regulatory

2developments such as this one on UIC of CO2 for GS, should remove legal and institutional barriers that prevent the development and use of carbon capture and storage/sequestration technologies. That is, the design of a UIC/GS regulatory program should promote effici ent and simple regulation without

redundancies with other re gulations, yet maximize protection of underground sources of drinking water ("USDW"), and the public health and safety above ground.

Individual Response: EPA acknowledges that the issue of GS falls within the broader context of CCS and acknowledges that regulator y clarity is essential for enab ling GS to move forward in a manner that protects human health and the enviro nment. The Agency is working to identify areas

related to GS that could be addressed under other statutes to ensure that GS is conducted in a manner that is protective of human health and th e environment. Additionally, the Agency is and will continue to coordinate internally and with other Federal agencies involved in GS and CCS, including the Bureau of Ocean Energy Manageme nt, Regulation and Enforcement, Bureau of Land Management, and the United States Geological Survey, to promote consistency in existing

and future GS initiatives.

Please see the remainder of EPA’s responses to th is comment for further details. For additional information on EPA’s final regulatory approach, pl ease see the final rule and preamble as well as the rulemaking docket.

Letter ID: 0248 Comment ID: 22240 Letter Lines: 100 to 115

Comment Code: 1200 1.1 General comments about the rulemaking

Comment Code: 1310 1.1.2.4 Comments on other "out of scope" issues, e.g., pore space ownership

Comment: WEST Associates Comments on the Proposed Rule

The following are WEST's comments on the Preamble and proposed rule, which we believe will clarify and st rengthen the proposal:

– Under the proposed UIC regulation, siti ng UIC wells for GS in the west will likely involve a challenging set of nationa l agencies, states, and tribal sets of regional and sub-regional regulation that will require stre amlining in order to site UIC wells and pipelines to tran sfer super critical CO2 to GS sites located at some distances away from coal fired power plants. Such projects will cross over many jurisdictions and in volve a patchwork of regulatory requirements. This will require coor dination among fede ral and tribal jurisdictions since it is highly likely that most western projects will impact federal lands, including tribal lands. EPA should immediately start working towards building support and consensus among the federal land managers and BIA for the UIC regulatory program.

Individual Response: EPA understands that the CO2 plumes for large GS projects may cross

3State, Tribal, Territorial, EP A Regional, or national boundari es. The final GS rule, at §146.82(a)(2), requires the owner or operator to identify all State, Tribal, and Territorial

boundaries within the AoR. Based on this info rmation, the Director must provide written notification to all States, Trib es, and Territories to inform them of the permit application §146.82(b) and ensure that they are involved in any necessary processe s (e.g., development of the emergency and remedial response plan (§146.94 )). The Agency encourages transparency in the permitting process and anticipates that St ate-State/State-Tribal communication on GS permitting will facilitate information sharing an d encourage safe, protective projects.

EPA acknowledges that GS falls within the broade r context of CCS and the need for regulatory clarity to ensure that USDWs are protected from endangerment. In develo ping the final GS rule,

the Office of Water coordinated with other Agency program offices and across federal agencies (e.g., with the Department of Energy; United Stat es Geological Survey; Bureau of Ocean Energy Management, Regulation, and Enforcement, formerly the Minerals Management Service; Bureau of Land Management). The Agency continues to eval uate areas of potential applicability of other Federal environmental statutes including, but not limited to: the Clean Air Act; the Resource Conservation and Recovery Act; the Comprehe nsive Environmental Response, Compensation, and Liability Act; and the Marine Protection, Resear ch and Sanctuaries Act to various aspects of GS and CCS. The Agency will continue to coordinate on GS and CCS related issues to minimize redundancy and maximize efficiencies for owners or operators. For additional information, please see the discussion entitle d "How Does This Rulemaking Relate to Other Federal

Authorities and GS and CCS Activities?" in the preamble to the final GS rule.

Letter ID: 0248 Comment ID: 22241 Letter Lines: 117 to 123

Comment Code: 1200 1.1 General comments about the rulemaking

Comment Code: 1530 1.2.3.1 State regulatory effort s on GS (seeking comment)

Comment: – EPA needs to design the UIC program to facilitate GS sites that can be utilized by many individual power plants that may not have ready access to geologically suitable GS sites in proximity to such plants. What will be needed is state, tribal and fede ral cooperation to develop re gional storage sites that

could accommodate CO2 from sources in se veral states. Development of such regional storage sites would allow critic ally needed shari ng pore space in states that have the most favorable geology.

Individual Response: EPA encourages owners and operators and permitting authorities to coordinate where multiple injection operations ar e planned, but notes that the rule does not require such coordination. EPA not es that the impacts of multiple operators injecting into hydraulically connected formati ons must be accounted for in the AoR modeling required at §146.84, which must be based on detailed site-specifi c geologic data collected during the site characterization process including consideration of ex isting conditions (e. g., current injection activities). Please see the discus sion of AoR and Corrective Action in the preamble to the final

rule for additional information.

EPA adds that regulation of pore space ownershi p is outside the scope of this rulemaking.

4Letter ID: 0248 Comment ID: 22242 Letter Lines: 125 to 139

Comment Code: 3140 2.1.4 Comments that the proposed ge ologic data requirements are too stringent

Comment: – EPA needs to build a practical realis m into the site characterization UIC regulatory requirements under the SWDA. The current rule proposal is so "demanding" it may preclude many otherwise eligible geological storage sites.

The site characterization and related requirements for permitting a UIC well present a very large list of extremely de tailed potential impact issues that by themselves may be frightening to member s of the public. This evaluative process needs to be pared down to those most critical few factors that assure the greatest degree of safety for each unique UIC for CO2 GS site. WEST members do not want to see development of a regul atory program that gets so bogged down that it goes no further than the nuclear waste storage si ting fiasco in the US (e.g., the Nevada nuclear stor age site is still not appr oved by the state and is caught up in unrealistic public fear and political concerns ). If this happens to UIC for CO2 GS siting, it could stop the co al fired power plan t industry if CCS becomes one of a very few limited options for CO2 emissions abatement required under a GHG legislative or regulatory program.

Individual Response: EPA believes that a detailed geologic al site characterization (required under §146.82) is essential to ev aluating the presence and adequ acy of the various geologic features necessary to receive and confine inje cted CO2 for GS. The requirements for geologic

site characterization are base d on a long standing UIC regulatory framework developed to address specific risks to USDWs posed by injection. The Clas s VI GS requirements are tailored so that they are appropriate for the unique nature of injecting large volume s of CO2 into a variety of geological formations for long-term storage.

EPA adds that the GS rule does not address th e use of coal-fired pow er plants; instead the mission of the UIC program and the goal of th e GS regulation is to protect USDWs from endangerment, and every aspect of the GS rule is designed toward th at end. Therefore, EPA disagrees that any of these pr otective requirements are unnecessa ry, and clarifies that waiving any of the requirements would not be acceptable. The GS regulation allows flexibility where appropriate. Certain requirements (e.g., the need to characterize additiona l confining layers) are at the Director's discretion (§146.83(b)), based on his or her understanding of a particular site.

To the comment comparing the GS siting requ irements to nuclear waste storage siting requirements, EPA clarifies that the two activities are very different, and while it is out of the scope of the GS rulemaking to comment on the st ringency of nuclear waste siting requirements,

EPA stresses that the site charac terization requirements for GS wells are tailored so that they are appropriate for the unique nature of injecting la rge volumes of CO2 into a variety of geological formations for long-term storage.

5Letter ID: 0248 Comment ID: 22243 Letter Lines: 141 to 150

Comment Code: 5240 2.8.2.2 Post injection timeframe (seeking comment)

Comment Code: 5430 2.9.1 Comments on proposed financia l responsibility requirements (40 CFR 146.85)

Comment: – WEST urges EPA to avoid utilizing risk management approaches that discourage CCS development. WEST strongly believes th at regulatory certai nty is crucial, if meaningful investment is going to fl ow to CCS technologies and deployment. Certainty needs to be brought to long-t erm obligations, liabi lities and risks associated with GS projects. To assist in this regard, EPA should set a limit of 50 years in the future for liabilities to GS project owne rs and operators. Extending this limit beyond 50 years may seve rely limit financial investments in CCS projects. Post injection monitoring and financial assurance requirements are important, but need to be tailored to comport with the potential risks, which decrease significantly after injection is complete.

Individual Response: EPA disagrees that a post-injection si te care timeframe of 50 years is excessive for most Class VI wells. However, EP A acknowledges that there will be circumstances

where it can be demonstrated in less than 50 years that the plum e and pressure front no longer pose a risk of endangerment to USDWs. For this reason, the GS rule offers owners or operators flexibility regarding the duration of the PISC timeframe by: (1) allowing the Director discretion to shorten or lengthen the PISC timeframe during the post-injecti on period 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 demons trate, during the permitting process based on substantial data, that an alternative PISC tim eframe may be appropria te if it ensures nonendangerment of USDWs pursuant to requirements at §146.93(c).

EPA believes that a default post-injection site car e timeframe of 50 years, with flexibility to adjust the timeframe for a limited number of GS projects during the permitting process where

substantial data exists to demonstrate that an alternative timeframe would be protective of USDWs, or based on data collected during the PISC period, is appropriate to address the range of sites where GS is anticipated to occur, to ac commodate site-specific circumstances and various geologic conditions, and addre sses commenters’ concerns, wh ile ensuring USDW protection. Both approaches will utilize si te-specific data, and be based on pressure monitoring and USDW impacts. EPA recognizes that there are chal lenges associated with ensuring funding for activities that will occur far in the future. However, the Agency be lieves that operators must demonstrate that financial resources are available to plug the inje ction well and provide po st-injection care at the point in time that the first CO2 is injected. EP A also recognizes the conc erns associated with ensuring financial responsibility for the long tim e frames over which post-injection site care will be conducted. EPA is developing guidance on financ ial responsibility to assist owners or operators in evaluating the requi rements of §146.85 and to assist Directors in evaluating financial responsibility demonstrations. The guidance descri bes the types of financial mechanisms that operators may choose to use when evaluating th e financial responsibility requirements for GS

wells and it will also include a section on how to estimate costs to support accurate financial

6responsibility demonstrations. The guidance will be available at http://water.epa.gov/type/groundwater /uic/wells_sequestration.cfm.

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 USDWs from endangerment.

EPA disagrees that the requirements for financial responsibility are overly stringent. The goal of financial responsibility for purposes of this rule is to ensure that financial resources are available to prevent the endangerment of USDWs from improper plugging, remediation, and management

of wells in the event that the owner or operator experiences fina ncial difficulties throughout the life of the project.

EPA expects the cost of meeting the financial re sponsibility requirements to be proportionate to the expected costs of each GS activity. The minimum financial responsibility requirements provided are necessary to prevent endangerment of USDWs by holding well owners or operators accountable for the safe operation and closure of the well while a voiding expense and risk to the public. See the final rule and preamble for further discussion of EPA's final approach to financial responsibility. EPA adds that th e purpose of the GS rule is no t to encourage the use of GS; rather, the purpose of the GS rule is to ensure that, where GS is depl oyed, it is conducted in a manner that protects USDWs from endangerment.

Letter ID: 0248 Comment ID: 22244 Letter Lines: 152 to 167

Comment Code: 5460 2.9.2 Comments on transfer of lia bility for long-term care

Comment: – Nevertheless, WEST believes an effici ent and effective liability insurance program should be developed for UIC GS site developers and owne rs to avoid what otherwise will be a very large disincentive for project developers to construct the significant amount of GS capacity that will be needed to m eet the goals of a national GHG emissions abatement program such as what S.2191 portends. The utility electric power industry is fa miliar with the model offered by the nuclear power industry as regulated by th e NRC. WEST believes that because of the very low probability of catastrophic re lease of stored CO2, but because of the extremely high potential risk of harm to the public in the unlikely event of a catastrophic release, a Liability Model patterned after the principles laid out in the "Price-Anderson Nuclear Industries Indemnity Act of 1957" may be workable in this instance. This Liability Model is comprised of three elements:

1. Site-specific private insurance, 2. Industry-wide pooled insurance, and 3. Federal indemnity as the insurance of last resort.

Individual Response: Owners or operators may choose from a variety of financial instruments to meet their financial responsibility obligati ons under the rule, includ ing private insurance, provided the Director determines that the operato r's proposed instrument is adequate to protect

7USDWs from endangerment. The ab ility of the owner or operator to pay for each activity must be demonstrated, including correc tive action on wells in the AoR, injection well plugging, PISC and site closure, and emergency and remedial response throughout the lif e of the project. The final GS rule specifies at §146.85(a)(1) the pe rmitted types of financial responsibility instruments. See the final rule and preamble for fu rther discussion of EPA's approach to financial responsibility.

Under SDWA, EPA has the general authority to set financial responsibility requirements for injection well owners or operators to ensure th at adequate resources are available to protect USDWs throughout the life of the GS project. However, this au thority does not extend to allowing the Agency to create a financial instru ment with EPA as the trustee, due to the

restrictions of the Miscellane ous Receipts Act (MRA). The MRA requires that EPA deposit the

funds it receives for the use of the Government into the Treasury, therefore funds would not necessarily be available for GS financial responsibility.

Additionally, EPA does not have authority under SDWA to establis h a trust fund for purposes of financial responsibility for Class VI projects. The Agency clarifie s that the trust funds that are addressed as financial responsibility instruments on the GS rule are set up by individual owners or operators and are different from a national-le vel trust described by th e commenters that would cover large numbers of GS projects.

EPA acknowledges the commenter’s concern regardi ng the applicability of multiple statutes to GS projects and the need for a single clear liabi lity regime for owners or operators. EPA is working to create a nationally consistent financia l responsibility regime wi thin its authority to

ensure that financial resources are available to protect USDWs throughout the life of the GS project. However, the authority under the SDWA does not extend to release owners or operators from long-term responsibility for the potential economic costs of impact s unrelated to USDWs. EPA does not have authority to transfer liability from one entity to another and SDWA does not provide for the creation of a third party financial instrument where EPA is the trustee. In the UIC program, liability under SDWA §1423 remains with the owner or operator for all well classes until all regulatory requirements have been me t. EPA understands that Congress is considering legislation that may address the liability issue. EPA clarifies that the GS regulation does not promote or encourage the use of GS; rather it is designed 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. See the final rule preamble for further discussion of EPA's final approach.

Letter ID: 0248 Comment ID: 22245 Letter Lines: 169 to 181

Comment Code: 3100 2.1 Proposed Geologic Siting Requirements (40 CFR 146.83)

Comment: – WEST urges EPA to take appropriate ca re in characterizing the risks of CO2 geologic storage under the UIC program. As we commented above, a successful national CO2 emissions abatement program w ill necessarily need to rely heavily upon development of and public support fo r CCS. By overly burdening the detail

8of site characterization and UIC of CO 2 risks related to given sites under consideration, EPA could inadvertently and inappropriately stigmatize CCS, particularly if it heads off into an un warranted categoriza tion of CO2 as a pollutant or a hazardous waste. Such exce ssive focus on risk or inappropriate characterization would imply liability risk that would chill further development of critically needed CCS under a climat e change program. WEST Associates believes EPA can develop site characte rization regulations that minimize potential burdensome regulations based on known potential site characteristics as discussed in these comments immediately below.

Individual Response: EPA believes that a demons tration to the public that extensive data have been collected and evaluated would likely impr ove confidence in the project and help address public questions and concerns.

EPA recognizes that many CO2 streams may be rela tively pure, and research indicates that the estimated amounts of impurities in a CO2 stream are likely to be low. However, EPA believes that owners or operators of GS wells must characterize their CO2 stream as part of their permit application, as required at §146.82(a)(7). This info rmation can help the Director determine the potential for geochemical reactions between the injectate (CO2) and the host geologic formations, which could result in the plugging of pore spaces orthe dissolution of formation

minerals.

Since the GS rule, at §146.81(d), excludes CO2 str eams that meet the definition of a hazardous waste under 40 CFR part 261, if the injectate is de termined to meet the definition of a hazardous waste under RCRA, injection may only occur in a Class I hazardous waste injection well.

Letter ID: 0248 Comment ID: 22246 Letter Lines: 183 to 205

Comment Code: 1250 1.1.1.4 Flexibility is needed (p erformance-based standards)

Comment Code: 3100 2.1 Proposed Geologic Siting Requirements (40 CFR 146.83)

Comment: – EPA should apply a tiered set of site characterization requirements based on

demonstrable and known site characteristic s. For example, potential sites that are deep saline formations located more than one kilometer below the surface are generally recognized as among the most fa vorable and secure site options for assuring public safety.[FN1] If such sites do not have a USDW aquifer located between it and the ground surface above, a more streamlined regulatory site characterization and risk review may be appropriate. On the other hand, an example of a potential site that may require a more rigorous site

characterization and risk assessment ar e "sole source aquifers" which are aquifers that are a sole supply of wa ter for a region and are critically important to protect. Some stakeholders may assert that ther e should be no CO2 storage above or below a sole source, a quifer. However, such a restriction would essentially prohibit storage in many western areas. Rather, a better approach would allow EPA to permit UIC Cl ass VI wells in areas where it can be shown that there are sufficient caps and pr otections to prevent the migration of

9CO2 in overlying aquifers, even in proxim ity of aquifers designated as sole source. An early detection-monitoring pr ogram could be established to provide sufficient opportunity to mitigate any unlik ely release of CO2 from the geologic storage unit. Approaches like this illu strate how EPA can streamline UIC regulations for site characterization and permit UIC Class VI wells that first and foremost protect public safety, yet re flect a workable balance in adapting

site characterization and risk assessments based on criteria adaptable to unique

candidate sites.

Individual Response: EPA believes that requiring appr opriate, site-specific, 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. EPA belie ves that it is important for the Director to have as much site-specific information as possi ble in order to make an informed decision to permit injection for GS at a specific site. This approach allows the permit writer to establish requirements considering varying site conditions eliminating the need for tiered requirements. GS in areas that may pose risks to USDWs, as assessed and identified by the owner or operator and the Director during the site selection proces s, would not be permitted. EPA disagrees that a tiering system for GS sites or formations is appropriate. Instead, the GS rule focuses on evaluating the suitability of each site based on site-specific geological and operational data.

EPA adds that the final GS rule contains a pr ovision (at §146.95) for ow ners or operators to apply for waivers from the requirement that injection be below the lowermost USDW. EPA believes this waiver provision will reduce potential limitations on the re-permitting of Class II wells as Class VI wells, provided they meet the requirements at §146.95 while still protecting USDWs from endangerment.

Letter ID: 0248 Comment ID: 22247 Letter Lines: 207 to 218

Comment Code: 1630 1.3.3 RCRA/hazardous waste i ssues (seeking comment)

Comment Code: 1640 1.3.4 CERCLA issues (seeking comment)

Comment: [FN1: See EPA's VEF-Techni cal_Document_072408, pg. 6.]

– WEST is concerned about arguments made by some stakeholders that a whole suite of environmental laws should be app lied to CCS projects, including the Comprehensive Environmental Response, Co mpensation, and Liability Act ("CERCLA") and the Resource Conservation and Recovery Act ("RCRA"). These laws applied to CCS would impose significant obligations and potential liabilities not only on GS operators, but also potentially on ot her entities in the CO2 abatement chain, such as the power plant operators producing the CO2. This would likely chill technology advancement and commercialization of CCS. WEST urges EPA to design the UIC for CO2 GS program to limit CCS projects' liability under CERCLA and

RCRA.

Individual Response: First, EPA notes that the GS rule is not promulgated under either the

10RCRA or CERCLA statutes, and the applicability of those stat utes will not be determined under the SDWA or the terms of the GS rule, but rather according to those statutes themselves and any implementing regulations that may apply. With re spect to RCRA, EPA has decided to initiate a separate proposed rulemaking spec ifically to examine the issue of RCRA applicability to CO2 streams being geologically sequestered, includin g the possible option of a conditional exemption from the RCRA requirements for CO2 GS in Cla ss VI wells. EPA will consider these comments as part of its development of that proposal. The Agency will consider issues particular to RCRA in the context of that separate rulemaking, a nd recommends that the commenter read that proposed 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 pe riod for that rule.

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.

EPA adds that promoting the use of GS is outsi de the scope of the GS rule. Rather, the purpose of the GS regulation is to ensu re that, where deployed, GS is c onducted in a manner that protects USDWs from endangerment.

Letter ID: 0248 Comment ID: 22248 Letter Lines: 220 to 232

Comment Code: 1250 1.1.1.4 Flexibility is needed (p erformance-based standards)

Comment: – EPA's proposed regulation needs to focus on accurate site specific characterization of the potential risks posed by geologic sequestration of CO2 and the UIC program needs to be specifica lly tailored accordingly to address those identified risks. This will help EPA avoid over generalizing in its regulatory requirements. Too many genera l default provisions that presume universal application can be problematic. The geologic variability involved in different conceivable GS projects needs to be specifically a ddressed, site-bysite, on issues ranging from site characteriz ation to area of review (AoR) to containment requirements. The regulations should encourage site-specific, performance-based determinations at the permitting stage to handle these specific issues. This approach will work toward practical problem resolution without unduly alarming the public with generalizations about potential, but unrealistic risks and problems.

Individual Response: EPA agrees that permitting decisions for GS wells should be based on site-specific factors. The GS ru le requires owners or operators to submit, and Directors to

11consider, extensive site-specific data, specified at §146.82, to demons trate that a site is suitable for GS. Additionally, many of the permit require ments for GS wells are established through individualized site-specific pl ans for AoR and corrective actio n, testing and monitoring, and injection well plugging and post-injection site care and site closure. EPA adds that the final GS rule includes a balance of speci fic criteria to be met by the owner or operator and areas of

Directorial discretion and consider ations for how that discretion would be exercised. The Agency believes this balance allows for GS projects to be designed and permitted to address the unique, site-specific aspects of each project, while prov iding consistency in permitting across the U.S.

Rather than setting performance or technology-ba sed standards for GS projects, EPA is adopting a flexible approach, where opera tors of GS projects would deve lop and implement site-specific plans for delineating the AoR, testing and mon itoring the site, performi ng corrective action, and post-injection site care. EPA believes that the plans—which would be re viewed and approved by the Director and periodically updated throughout the life of the project—promote an ongoing dialogue between the operator and the Director th at will encourage use of the most appropriate technologies for a part icular project.

Letter ID: 0248 Comment ID: 22249 Letter Lines: 234 to 246

Comment Code: 1530 1.2.3.1 State regulatory effort s on GS (seeking comment)

Comment Code: 5600 2.11 Comments related to UIC Program primacy for Class VI wells

Comment: – EPA's proposed UIC for CO2 GS rule needs to fully respect states' expertise in administering the current SDWA programs. The UIC for CO2 GS program needs to provide a reasonable process whereby indivi dual states can obtain permitting and compliance primacy over regulation of EPA' s proposed Class VI (CCS) wells. Many states already administer SDWA programs a nd a number of states are moving ahead with developing their own initiatives a nd regulations to solve other issues associated with CCS. However, EPA will need to consider how to handle projects that span multiple states, tribal lands , and other agency jurisdictions as commented earlier. EPA could establish a primary state in such multiple jurisdiction affected proj ects, along with a permitting and coordination process for permitting purposes would engage othe r affected states in providing for notice and comment by all stakeholders. This same principle may be applied to multiple agency jurisdictions, such as the BLM, the NPS, and other agencies.

Individual Response: EPA agrees with commenters on the importance of states having primacy for GS wells given the variety of geologic settin gs in which GS will be applied. EPA recognizes that State, Tribal, Territorial a nd DI UIC Program Direct ors are in the best position to evaluate the unique issues related to well depth, geol ogy, and hydrogeology that are posed by a Class VI well. Some degree of flexibility is needed for Cl ass VI wells because each decision made will be site-specific and conditions will di ffer from state to state. The GS rule balances the need for these site-specific decisions with the need for mi nimum standards to ensure national consistency.

Given the potential for CCS (encompassing captur e, transportation, and geologic sequestration) to be an important part of a national priority to address climate change, EPA believes that

12providing states the flexibility to obtain primacy for Class VI we lls independently of other well classes can help foster effec tive management of CCS. EPA belie ves that allowing independent Class VI primacy may encourage states to take responsibility for impl ementation of Class VI regulations and provide for a more comprehensive approach to managing CCS projects by promoting the integration of GS activities unde r SDWA into a broader framework for managing CCS. The Agency will allow independent primacy for Class VI we lls under §145.1(i) of the final GS rule. Furthermore, GS operations involve an cillary activities (e.g., pi peline operations, pore space ownership, land use rights, and surface access) for which states can call upon other authorities that exist at the state level ( but outside UIC authority) to provide a more comprehensive CCS management approach.

EPA clarifies that issuance a nd oversight of a GS permit, including any associated AoR boundary related coordination, is th e responsibility of the primacy (State, Tribal, or Territorial) or regional DI program in the state where the injection well is located. EPA understands that the CO2 plumes for large GS projects may cross State, Tribal, Territorial or EPA Regional boundaries. The final GS rule, at §146.82(a)(2), re quires the owner or oper ator to identify all State, Tribal, and Territorial bounda ries within the AoR. Based on this information, the Director must provide written notification to all States, Tribes, and Territories to inform them of the permit application, as specified in §146.82(b), and en sure that they are involved in any necessary processes (e.g., development of the emergency and remedial response plan, as specified in §146.94. The Agency encourages transparency in the permitting process and anticipates that State-State/State-Tribal communication on GS pe rmitting will facilitate information sharing and encourage safe, protective projects.

Because some GS projects will require coordi nation across State, Tribal, and Territorial jurisdictions and plans, the Agency will work with the appropriate entities to facilitate communication among States, Tribes, and Territories interested in obtaining Primacy during the implementation phase of the GS regulati on. Such communication may involve other organizations such as the Sierra Club, NDWAC, associations, and other experts. However, the responsibility for addressing such subjects ultimately rests with th e States, Tribes, and Territories with primacy. In addition, EPA is developing guidan ces for states that de scribe the process of applying for and receiving primary enforcement re sponsibility (primacy) for GS Class VI wells under Section 1422 of SDWA, as we ll as the technical and admini strative issues on developing GS regulations that are the e quivalent of minimum federal cr iteria and requirements. The guidance will be available at h ttp://water.epa.gov/type /groundwater/uic/wells_sequestration.cfm.

Letter ID: 0248 Comment ID: 22250 Letter Lines: 248 to 256

Comment Code: 1250 1.1.1.4 Flexibility is needed (p erformance-based standards)

Comment Code: 2400 1.8 Comments on EPA's adaptive rulemaking process

Comment: – Finally, EPA needs to build into this regulation a "learning and adjustment" process that gains feedback from implemen tation of the UIC for CO2 GS rule, and establish a periodic review process to make adjustment s and corrections to the rule based on experienced gained in pe rmitting, operation, and closure of UIC/GS wells. A CCS program of the size anticipa ted to meet national climate change

13CO2 abatement goals is going to create a very large endeavor that is bound to experience difficulties in its deployment and implementation. EPA needs a ready means to provide regulatory adjustments to reinforce the safety and success of this UIC / GS program as it proceeds in the future.

Individual Response: EPA agrees that an adaptive approach to the UIC GS rulemaking is appropriate. The Agency plans to use such an appr oach to ensure that USDWs are protected from endangerment and meet the potentially fast p ace of GS deployment. EPA believes that an adaptive approach will allow regulatory developmen t to proceed in time to meet the current and future demand for Class VI permits while recognizi ng the need to: continue to gather data from pilot projects and other research as it becomes available; and to enhanc e understanding of the technical and administrative asp ects of GS deployment, operati on, and technology developments.

EPA plans, every six years, to collect and review data on GS projects to determine whether the appropriate amount and types of information a nd appropriate documentation are being collected,

and to determine if modifications to the re quirements are appropr iate or necessary.

Letter ID: 0248 Comment ID: 22251 Letter Lines: 258 to 263

Comment Code: 1000 1. General and Administrative Comments

Comment: WEST Associates sincerely appreciates this opportunity to comment and provide recommendations on EPA’s proposed rule regarding UIC for CO2 Geological Sequestration.

Should you have any questions or need further information, please do not

hesitate to contact Davi d Steele at (520) 321-1111.

Individual Response: EPA acknowledges the comment. Pleas e see the remainder of EPA's responses to this comment letter for further de tails. For additional information on EPA's final regulatory approach, please see the final rule and preamble as well as the rulemaking docket.

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