OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

1

U.S. ENVIRONMENTAL PROTECTION AGENCY

Public Hearing

Greenhouse Gas Mandatory Reporting Rule, 

Subpart W (Petroleum and Natural Gas Systems),

and Subpart RR (Carbon Dioxide

Injection and Geologic Sequestration)

9:14 a.m. to 5:00 p.m.

Monday, April 19, 2010

Lobby Level One Potomac Yard

(South Building) 

2777 South Crystal Drive

Arlington, VA 22202
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

2

C O N T E N T S

 

 PAGE

Welcoming Remarks

 Dina Kruger, Presiding Officer................3

Introductory Remarks

 Dina Kruger...................................4

Morning Public Comments

Pamela Lacey, American Gas Association..........9

Bruce Hill, Clean Air Task Force...............16

Karin Obershain, Edison Electric Institute.....22

Daniel Klein, 21s t Strategies...................27

Anne Harvey, Sierra Club.......................33

Karin Ritter, American Petroleum Institute.....44

Peter Zalzal, Environmental Defense Fund.......50

Carliane (Kipp) Coddington, 

 North American Carbon Capture
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

3

and Storage Association.......................57

Phillip Marston, Marston Law...................61

- - -
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

4

1 P R O C E E D I N G S

2 Welcoming Remarks

3 MS. KRUGER: Good morning again, 

4 everybody. I think we’ve worked out our technical 

5 difficulties and we are ready to get started. 

6 On behalf of the Environmental Protection 

7 Agency, I’d like to welcome you all to today’s 

8 public hearing. My name is Dina Kruger. I am 

9 the Director of the Climate Change Division in 

10 the Air Office at EPA. It is my group working 

11 with colleagues across the Agency that have 

12 developed the proposals that you are here to 

13 comment on today. 

14 Introductory Remarks

15 I’m joined by Paul Gunning who runs the 

16 Non-CO2 Programs Branch and Rona Birnbaum who runs

17 the Climate Science and Impacts Branch. They are 

18 both managing parts of the proposals that we’ll 

19 be discussing today, Paul focusing primarily on 

20 the oil and natural gas sector and Rona on 

21 geologic sequestration. 

22 I’d also like to emphasize that we have 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

5

1 worked very closely across the agency on these 

2 proposals and in particular have collaborated 

3 very closely with our Office of Water on a 

4 proposal that relates to the injection of CO2

5 underground. As many of you are I’m sure very 

6 well aware, they are concurrently finalizing 

7 their proposed regulations for the use of the 

8 Underground Injection Control Program for 

9 Geologic Sequestration and we are working very 

10 closely with them as they finalize that and we 

11 develop this proposal. 

12 The purpose of today’s hearing is to

13 receive comments on two of the subparts that we 

14 put out last month and that were published in the 

15 Federal Register, I guess, just a week ago. 

16 These are the subparts related to the petroleum 

17 and natural gas sectors, Subpart W, and the 

18 subpart related to CO2 Injection and Geologic 

19 Sequestration, Subpart RR. So we will be looking 

20 for comments on those two subparts today and then 

21 we’ll be having a second hearing tomorrow at our 

22 offices on L Street related to the subpart 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

6

1 related to the fluorinated gases.

2 This hearing will be conducted in 

3 accordance with the Clean Air Act under which EPA 

4 provides interested parties the opportunity for 

5 an oral presentation of views and arguments as 

6 well as the opportunity to submit written 

7 comments. So this is the forum for your oral 

8 presentations. We are having this hearing 

9 recorded and hopefully that is now working well 

10 and there will be a transcript that will be 

11 developed and made available for public 

12 inspection at our docket.

13 And so if you’re interested, I can 

14 quickly say what the docket numbers are if you 

15 subsequently want to go and look for them. The 

16 docket number for CO2 Injection and Geologic 

17 Sequestration Reporting Proposal is EPA-HQ-OAR18 2009-0926, and the docket number of the Petroleum 

19 and Natural Gas Subpart is exactly the same up 

20 until those last four numbers, so EPA-HQ-OAR21 2009, and the last four numbers are 0923.

22 The transcript will also be available on 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

7

1 Regulations.gov so you can also see it 

2 electronically. 

3 The hearing is conducted informally. 

4 Formal rules of evidence do not apply. However, 

5 as the Presiding Officer, I am authorized to 

6 strike from the record statements which are 

7 deemed irrelevant or needlessly repetitive and to 

8 enforce reasonable time limits on your remarks. 

9 Given the number of people that have signed up so 

10 far, I think what we’re going to do is start with 

11 five minutes. If you go substantially longer 

12 than five minutes, I will cut you off. We’d like 

13 to keep it to certainly no more than ten. But 

14 you will also in addition to your oral 

15 statements, be able to make written statements or 

16 expand your remarks in writing for the record. 

17 When you come up to speak, please first 

18 state your name and affiliation. That helps us 

19 with the transcription. When you’re finished 

20 with your comments, this panel may ask clarifying 

21 questions, but this is not the place where we’re 

22 going to get into a discussion or a back and 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

8

1 forth about your comments. It’s our goal here to 

2 hear from you your comments on the proposed rule.

3 Also because we are combining covering 

4 two subparts in today’s hearing, please be clear 

5 when you’re talking about Subpart W or when 

6 you’re talking about Subpart RR. I’m guessing 

7 that many of you may be here because you’re 

8 particularly interested in commenting on one of 

9 those subparts, but I recognize that there may be 

10 others who are planning on covering both and 

11 that’s absolutely fine.

12 If your oral comments are different from 

13 your written comments, you should submit your 

14 written comments to the docket. 

15 The last little piece of business is to 

16 ask everyone to turn off their cell phones so 

17 that we won’t be interrupted by that. What I’m 

18 going to do now is start taking – we’ll start 

19 hearing from all of you in the order in which you 

20 signed in. I’m going to basically call out three 

21 names so you’ll know who’s up sort of first, 

22 second, third and then when we finish we’ll do it 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

9

1 again. And we’ll be taking reasonable breaks 

2 throughout the morning. 

3 I’ll also say that I’m probably not going 

4 to be your presiding officer all day. At some 

5 point this morning, I’m going to have to head 

6 back to my office and I will leave you with Rona 

7 and Paul.

8 So with that, our first three commenters 

9 in order are Pamela Lacey, Bruce Hill and Karen 

10 Obenshain. So, Pam.

11 MS. LACEY: Good morning. My name is 

12 Pamela Lacey. I’m the Senior Managing Counsel, 

13 Environmental, for the American Gas Association.

14 My testimony today will relate to Subpart 

15 W alone.

16 AGA represents 195 local energy companies 

17 that deliver clean natural gas throughout the 

18 United States. There are more than 70 million 

19 residential, commercial and industrial natural 

20 gas customers in the U.S. of which 91 percent –

21 more than 64 million customers – receive their 

22 gas from AGA members.
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

10

1 AGA appreciates EPA’s effort to reduce 

2 direct measurement in this re-proposal of Subpart 

3 W. As a general rule, engineering estimates and 

4 emission factors provide a more workable approach 

5 for natural gas facilities. However, as always, 

6 the devil is in the details – we have concerns 

7 about the specifics for underground storage and 

8 LNG facilities, and we will address those 

9 concerns in our written comments and perhaps in 

10 meetings with you given the shortness of the time 

11 today. I won’t get into that now.

12 More importantly, we have serious 

13 concerns about your proposal for natural gas 

14 distribution systems – which were not covered by 

15 your earlier proposal and have been added in this 

16 one. As I will briefly describe, the results 

17 would not justify the level of effort and cost 

18 required by this proposal.

19 First, we believe you cast your net too 

20 broadly when defining the concept of “facility” 

21 for natural gas distribution. As a result, the 

22 proposed rule would likely apply to many more gas 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

11

1 utilities and require a much greater burden than 

2 you estimate. It is not clear to us whether you 

3 intend to define the facility as each 

4 distribution system or as all of the distribution 

5 systems owned by a single “Distribution Company.” 

6 The two are not aligned all the time. If you 

7 plan to combine all of the separate distribution 

8 systems of a single company in one facility that 

9 spans hundreds of communities if not thousands 

10 across a state – some of our companies span 

11 several states as well – you would have many more 

12 utility companies that would be likely to exceed 

13 your 25,000 ton per year threshold for reporting. 

14 Once in, those utilities would then have to 

15 estimate and report emissions for many small 

16 meter and regulator stations and city gate 

17 stations that are scattered across the state as 

18 well as the combustion emissions from sources 

19 that would otherwise not exceed the facility 

20 reporting threshold.

21 Second, the proposal for leak detection 

22 and reporting would impose significant additional 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

12

1 costs and overstate the actual level of 

2 emissions. The proposed rule would require 

3 utilities to conduct annual leak detection at 

4 above grade M&R stations – that’s metering and 

5 regulating – and to apply emission factors to 

6 those leaking sources. While current practices 

7 require regular leak detection, the current level 

8 of detection does not nearly approach what would 

9 be required by this proposal which calls for 

10 optical imaging. We question whether there would 

11 be enough equipment or trained operators to 

12 conduct such annual surveys at all the M&R 

13 stations across the country that would be 

14 affected. Also, when utilities conduct leak 

15 detection, they promptly repair leaks that can be 

16 readily repaired. So reporting the repaired 

17 components as if they were leaking for the entire 

18 year would end up overstating actual emissions. 

19 We’re concerned about that as well. 

20 Third, we are concerned that your plan to 

21 use emission factors that were developed over a 

22 decade ago for another purpose by the Gas 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

13

1 Research Institute, GRI, that were based on 

2 limited field work conducted nearly 20 years ago 

3 beginning in 1992 – we’re concerned about that 

4 because many things have changed since then. 

5 Much of the old cast iron and steel pipe has been 

6 replaced or lined with new plastic pipe. 

7 And modern plastic pipe has significantly lower 

8 fugitive emissions. Materials and construction 

9 methods and practices for operations have changed 

10 as well and improved. As you know, over the past 

11 decade, our members have been working with your 

12 EPA Natural Gas STAR program with Roger Fernandez 

13 who’s here some place in the audience. And we’re 

14 working through that program to develop and 

15 implement practices that make our systems 

16 tighter. Well, that work has been going on, but 

17 those emission factors have not changed in the 

18 meantime. Those old emissions factors represent 

19 an old snapshot in time and they do not reflect 

20 reality now. And they tend to vastly overstate 

21 emissions from modern, tighter natural gas 

22 distribution. 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

14

1 Fourth, we are worried that you are 

2 trying to go too far down into the weeds at 

3 distribution facilities asking for estimated 

4 emissions from too long a list of individual 

5 components. Our members do not typically keep a 

6 comprehensive inventory of the number of 

7 components that they have at any given metering 

8 and regulator station. For example, one of our 

9 companies – I’ll get to that in a moment. The 

10 proposed rule apparently would require knowing 

11 the number of each type of component in order to 

12 apply a component-specific emission factor 

13 multiplied by the number of components. And if 

14 we don’t already have that list then we’re going 

15 to have to go out to each of those stations out 

16 at remote locations and make an inventory.

17 Now, I know that this sounded logical in 

18 theory, but in practice, it would be onerous. It 

19 would require our gas utility personnel to visit 

20 thousands of remote facilities surveying 

21 equipment for each station in minute detail just 

22 to develop these lists of components. One 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

15

1 company for example operates at least 10,000 M&R 

2 stations. This will require many hours of work 

3 at great expense to go out and do these surveys. 

4 And then for what result? Because in the 

5 end all we can do with the old emission factors 

6 is to calculate a fictional number that we all 

7 know is seriously inaccurate and is likely to 

8 vastly overstate and misrepresent the level of 

9 actual emissions at distributional facilities. 

10 And this all for a sector that contributes a tiny 

11 portion of the total CO2e emissions in the 

12 country – less than one percent of the total.

13 Therefore, we urge you to postpone 

14 requiring fugitive emission reporting for natural 

15 gas distribution under Subpart W. Instead, AGA 

16 would like to finish the joint project we have 

17 undertaken with EPA and others to conduct field 

18 testing and to develop updated, modern, accurate 

19 emission factors for natural gas distribution. 

20 AGA and its members have already conducted work 

21 in this area and developed some emissions factors 

22 that are not reflected in this proposal. And we 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

16

1 are committed to further improvements in emission 

2 factors. 

3 Thank you for the opportunity to testify.

4 MS. KRUGER: Thank you, Pam. Any 

5 questions? Roger?

6 MR. GUNNING: Thanks for your comments. 

7 MS. KRUGER: Thank you very much.

8 MR. HILL: Test, test.

9 MS. KRUGER: Thank you for bearing with 

10 us.

11 MR. HILL: Good morning. For the record, 

12 my name is Bruce Hill. I’m a senior scientist 

13 with Clean Air Task Force. Clean Air Task Force 

14 is a Boston-based organization dedicated to 

15 restoring clean air and healthy environments 

16 through scientific research, public education and 

17 legal advocacy.

18 We appreciate the opportunity to comment 

19 on Subparts RR and W of the proposed Greenhouse 

20 Gas Reporting Rule. First, I’ll comment on 

21 Subpart RR, then on Subpart W. 

22 Clean Air Task Force is generally pleased 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

17

1 with EPA’s Subpart RR proposal. We believe its 

2 expeditious promulgation will provide a key 

3 building block for the United States greenhouse 

4 gas mitigation strategies especially in view of 

5 the mounting evidence of irreversible changes in 

6 the earth’s climate. We believe the rule also 

7 represents an important step forward in ensuring 

8 the secure geological sequestration of carbon 

9 dioxide captured for fossil fuel combustion.

10 This technology must move forward as a 

11 bridge to the clean energy technologies of the 

12 future and as an essential step towards reducing 

13 CO2 emissions needed for climate stabilization.

14 CATF supports EPA’s general approach in 

15 Subpart RR and believes that the air side 

16 requirements embodied in the proposal can help 

17 expedite the development of commercial scale 

18 carbon capture and geologic sequestration in the 

19 United States. 

20 Carbon dioxide injection is a technology 

21 that has a three-decade long track record. In 

22 fact, hundreds of millions of tons of CO2 have 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

18

1 been injected and effectively sequestered for 

2 enhanced oil and gas recovery, ER, since the 

3 1970s. 

4 We believe EPA’s opt in provision 

5 recognized the important role of ER in improving 

6 sequestration technologies and that it will 

7 provide new data leading to a more robust 

8 understanding of geological CO2 retention 

9 processes. 

10 CATF supports the all in approach but 

11 believes it should go further to include 

12 federally funded research and development 

13 facilities. These R&D projects which the 

14 proposal specifically excludes represent early 

15 opportunities to test and verify EPA’s approaches 

16 to monitoring verification reporting, MVR. 

17 CATF also supports the case by case 

18 approach to MVR embodied in this proposal, 

19 however, it’s our position that EPA should 

20 reserve the right to prescribe certain universal 

21 MVR methods, for example, above injection zone 

22 monitoring.
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

19

1 A robust underground injection control 

2 rule, UIC rule, governing permitting of GS 

3 facilities finalized in parallel with the 

4 Greenhouse Gas Reporting Rule is critical to 

5 ensuring integrated water and airside 

6 environmental health protections. 

7 Air side MVR requirements must be 

8 carefully cross-linked with the final UIC rule as 

9 under the UIC proposal, states are the permitting 

10 authorities.

11 While EPA’s Airside Monitoring and 

12 Reporting Rule does allow the GS facility to rely 

13 on its UIC permit monitoring reporting 

14 requirements, we think the rule could go further 

15 to engage the state agencies and MVR development 

16 for GS facilities. That’s because the states 

17 that have regional and local expertise and 

18 geology underground injection control history and 

19 atmospheric monitoring that must serve as a 

20 foundation for robust case by case MVR plans.

21 Because permitting will largely be 

22 overseen by the states and because airside 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

20

1 monitoring tools are largely the same as those 

2 for ground water protection under the UIC 

3 program, EPA’s rules should harmonize the 

4 development and approval of airside and UIC MVR 

5 strategies.

6 State participation would not only 

7 provide more efficiency in MVR development, but 

8 will be key to safeguarding the local 

9 environment.

10 We understand that the rule cannot offer 

11 remedies to airside impacts of CO2 injection, but 

12 through the rule EPA should direct that all 

13 information collected by the MVR program be 

14 reported to the UIC permitting authorities in a 

15 timely manner. Immediate reporting will be 

16 particularly important where there is evidence of 

17 leakage or pressure front migration such that the 

18 shutdown triggers and airside mitigation measures 

19 in the permits can be put in place by the state 

20 agencies in addition to the revision of the MVR 

21 plan that’s required under the proposal.

22 In addition CATF encourages EPA to 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

21

1 consider public participation by incorporating 

2 notice and comment in the MVR development 

3 process.

4 We are also pleased that EPA has issued 

5 the supplemental proposal to EPA’s Subpart W Rule 

6 governing monitoring and reporting of fugitive, 

7 vented and flared greenhouse gas emissions from 

8 the oil and gas industry. 

9 We believe the inclusion of oil and gas 

10 facilities is well within the authority provided 

11 by Section 114 of the Clean Air Act. Accurate 

12 accounting for these emissions is important in 

13 establishing comprehensive greenhouse gas 

14 inventories and for developing reduction 

15 strategies. 

16 In particular, we believe quantifying 

17 sources of methane emissions is critical in 

18 pinpointing areas where reductions and climate 

19 forcing can be expeditiously achieved. Because 

20 methane is a short-lived pollutant with a global 

21 warming potential many times greater than carbon 

22 dioxide, a methanes emissions reduction strategy 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

22

1 informed by this data could have significant near 

2 term benefits.

3 Finally, we applaud EPA’s proposed 

4 reporting for onshore petroleum and natural gas 

5 production and distribution facilities. Taken 

6 together, the fugitive, vented and flared methane 

7 and CO2 emissions represent one of the largest 

8 sources of greenhouse gas emissions from the 

9 industry.

10 Thank you for the opportunity to comment 

11 and we’ll be providing detailed written comments 

12 by the deadline.

13 MS. KRUGER: Thank you very much. Our 

14 next speaker is Karen Obenshain.

15 MS. OBENSHAIN: Good morning. My name is 

16 Karen Obenshain. I am with the Edison Electric 

17 Institute. I am the Director of Fuels Technology 

18 and Commercial Policy and I also facilitate EEI 

19 CCS workgroup. We really appreciate being able 

20 to give oral comments here today. 

21 EEI, Edison Electric Institute, is an 

22 association of the shareholder-owned electric 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

23

1 utilities in the United States. Our members 

2 represent 70 percent of the industry. And the 

3 lights going out were not our problem. 

4 [laughter]

5 Again, EEI appreciates being able to come 

6 here this morning and we will be filing written 

7 comments.

8 EEI believes that it is appropriate for 

9 EPA to have proposed a separate rule for 

10 reporting possible emissions from CCS rather than 

11 include it with another source category. EEI 

12 notes, however, EPA treats CCS very differently 

13 from other source categories. Instead of 

14 providing methods to collect and report 

15 emissions, EPA is proposing rules that tend to 

16 prevent emissions. In other words, EPA is using 

17 this rule to demonstrate the efficacy of long18 term storage. 

19 While EEI supports efforts to demonstrate 

20 that storage works – which we believe it does –

21 EEI’s initial review of the proposed reporting 

22 and monitoring requirements indicates that the 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

24

1 burdens might not be commensurate with the risk 

2 of emissions to the air of stored CO2. As EPA has

3 noted, properly sited and managed geologic 

4 storage formations have very little chance of 

5 emissions. Accordingly, EPA regulations should 

6 approach the reporting rule for CCS from the 

7 assumption that leakage is unlikely. 

8 The UIC program ensures storage sites 

9 will be properly sited and monitored. EPA should 

10 recognize this in the context of possible air 

11 emissions. 

12 Moreover, EPA should recognize that the 

13 minimus fugitive emissions do not undercut the 

14 value or efficiency of storage as a climate 

15 mitigation tool, especially when one considers 

16 the millions of tons that could be stored over 

17 the life of our project. 

18 EEI urges EPA to keep in mind that the 

19 actual risk of large leaks from storage sites is 

20 extremely small as it moves forward with its 

21 rulemaking. 

22 That being said EPA [sic] supports EPA’s 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

25

1 proposal that MRV plants be site-specific. 

2 Different sites have different risks, and lower 

3 risk sites should be rewarded with appropriately4 tailored regulatory requirements. 

5 EEI is still reviewing all elements of 

6 the CCS proposal, but offers the following 

7 comments now. EEI appreciates EPA’s efforts to 

8 eliminate overlap between the UIC requirements 

9 and the proposed mandatory reporting rule 

10 requirements and supports EPA’s decision to allow 

11 storage sites to use their UIC permit to 

12 demonstrate compliance with portions of the 

13 reporting rule.

14 Consistent with the approach taken in the 

15 UIC program, storage operators should be allowed 

16 to take a phased approach to characterizing 

17 potential leakage pathways. 

18 EEI notes that EPA proposes to require 

19 characterization of all surface leakage pathways 

20 for the life of the project at the time the MRV 

21 is drafted and submitted. Instead, EPA should 

22 allow storage operators to update their MRV plans 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

26

1 and perform additional characterization of 

2 leakage pathways if needed on the same schedule 

3 as reevaluation of the area of review. 

4 EEI is concerned about the accuracy of 

5 environmental baselines. Given the atmospheric 

6 CO2 background concentrations very widely which 

7 EPA does acknowledge, it is not clear that it is 

8 feasible or useful to collect and report 

9 information about pre-injection environmental 

10 baselines. 

11 EEI is concerned that EPA has included no 

12 standards by which the agency or other regulators 

13 are to assess proposed MRV plans. EPA’s goal 

14 should be to ensure a streamlined approach to 

15 approval so that the projects can move forward 

16 without delay. 

17 EEI notes that EPA’s definition of 

18 research and demonstration facilities would 

19 encompass all CCS demonstration projects 

20 currently operating today or planned in the near 

21 future because all receive some level of federal 

22 funding. R&D projects should be allowed to opt 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

27

1 in to reporting requirements regardless of 

2 whether they receive federal funding. 

3 Thank you for the opportunity to comment 

4 on the proposal today. EEI looks forward to 

5 working with EPA as it continues to develop legal 

6 and regulatory structure for permitting CCS 

7 projects. Thank you.

8 MS. KRUGER: Thank you very much for your 

9 remarks. 

10 Okay, our next three speakers in order 

11 are Dan Klein, Anne Harvey and Karin Ritter.

12 MR. KLEIN: Thank you and good morning. 

13 My name is Dan Klein. I’m an energy and 

environmental consultant and my company is 21s t 14

15 Strategies. 

16 I have just a couple of comments I’d like 

17 to offer this morning on Subpart RR, specifically 

18 going to the cost of the proposal and then within 

19 that specifically to the cost of the commercial 

20 saline projects. These would be the projects 

21 which would have a second [inaudible]. 

22 [Pause.] 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

28

1 The commercial saline projects would be 

2 those who would have the additional second tier 

3 of data required to be reported. I’ve looked at 

4 this a little bit from the aspect of the 

5 potential total cost and the cost per ton 

6 reported and how that might compare to the rest 

7 of the categories under the Mandatory Greenhouse 

8 Gas Reporting Rule. 

9 I’m not going to comment on the 

10 environmental soundness of the proposal or 

11 inadequacies of the UIC proposed rule. Those are 

12 not areas in which I claim expertise.

13 EPA did an economic analysis to support 

14 Subpart RR and presented its national cost 

15 estimates. But generally, the scenarios that 

16 were presented do not include commercial saline 

17 projects in the economic analysis. That is the 

18 scenarios picked a sample of 89 projects and the 

19 high and low scenarios varied the amount of 

20 projects which would shift from the ER projects 

21 to those who would opt into the additional tier 

22 of reporting. Those scenarios did not have 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

29

1 commercial saline projects in them possibly 

2 because there was no way of estimating how many 

3 there might be. 

4 There was in EPA’s analysis, an estimate 

5 that commercial saline projects would have 

6 additional costs approaching $300,000 per project 

7 per year. And EPA provided the math that would 

8 show if you have either three, six or nine 

9 projects, what that would amount to. But if we 

10 want to think about what the total national cost 

11 is, it’s reasonable to think about how big a 

12 commercial program could be. 

13 Under some of the proposals for national 

14 legislation, we’re looking at total national 

15 reductions of emissions in the order of billions 

16 of tons per year. It’s not unreasonable to at 

17 least hypothesize a commercial sequestrations 

18 program approaching one billion tons a year. And 

19 if your average site is two or three million tons 

20 per year, we’re looking at several hundred sites 

21 nationally, at least potentially. 

22 If you have a cost per project of 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

30

1 $300,000 per project per year, then we are 

2 potentially looking at over $100 million for this 

3 aspect of the program, $100 million per year. 

4 That actually is more than the rest of the 

5 reporting rules categories combined which as I 

6 recall were about $98 million for the first year 

7 reporting and $72 million for the rest.

8 So potentially, these incremental 

9 requirements for commercial storage could more 

10 than double the cost of EPA’s program. 

11 So if we turn to the cost per ton, what 

12 do you get for this? Well, you take the total 

13 cost and you divide by how many additional tons 

14 you expect to be kept as part of this. As was 

15 pointed out before, we’re expecting effective 

16 storage and so your best estimate for a single 

17 site might actually be zero tons in which case 

18 dividing something by zero gives you an unreal 

19 number. 

20 But if we take a reasonable worst case, 

21 if we take the program goal which EPA, DOE and 

22 others have stated of 99 percent sequestration 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

31

1 over 100 years, and apply that to a commercial 

2 storage facility of a couple million tons per 

3 year, you’re probably looking at a reasonable 

4 worst case of 10,000, maybe a couple 10s of 

5 thousands of tons per year. If you can detect 

6 that and if you divide that into $300,000 per 

7 year per facility, we’re looking at a program 

8 cost of over $10 a ton simply for the measurement 

9 and reporting of the presumed leakage. This 

10 compares poorly to the rest of EPA’s [inaudible].

11 EPA looked, I think, very carefully and 

12 very effectively at what the cost would be for 

13 reporting at different thresholds per year. And 

14 settling on the 25,000 ton per year threshold, 

15 EPA took note of the extra cost it would be if 

16 they lowered the threshold to 10,000 tons 

17 instead. Going from 25,000 tons down to 10,000 

18 tons for the reporting rule, would have cost an 

19 extra $30 million per year for an estimated gain 

20 of 37 million tons of emissions identified and 

21 reported. That is something under one dollar per 

22 ton to report was rejected, I think, at least in 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

32

1 part because of the cost per ton effectiveness.

2 We’re looking here at geologic storage 

3 facilities that would be at least ten times that 

4 much. 

5 So, just to conclude, in a widespread 

6 commercial program if we’re looking at one 

7 billion tons a year perhaps as a possibility, 

8 we’re looking at a reporting requirement which 

9 would more than double the cost of the entire 

10 Greenhouse Gas Reporting Program and at a cost 

11 per ton which is at least ten times that of a 

12 threshold which has already been rejected. 

13 Thank you.

14 MS. KRUGER: What we’re going to do is 

15 we’re going to take just a five minute break so 

16 that – I’m sorry – yeah, we’ll take a five minute 

17 break just to see if we can get this audio stuff 

18 worked out and then we’ll turn to you. Thanks.

19 [Break.] 

20 MS. KRUGER: So what I think we’re going 

21 to do going forward, we have Anne Harvey up next 

22 followed by Karin Ritter, followed by Peter 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

33

1 Zalzal and Kippp Coddington. Those are the 

2 speakers that signed up to make remarks this 

3 morning. We will at the conclusion of Kipp’s 

4 remarks, I will invite anyone who has come today 

5 and did not identify themselves as wanting to 

6 speak but is so moved to come up and give us 

7 comments if you want. We will then have a break 

8 after that and we’ll keep the room open for the 

9 period of time that we said. But if others 

10 haven’t signed up, then we’ll just be waiting to 

11 see if any other speakers come and make 

12 themselves known to us.

13 So with that, I’m going to ask Anne 

14 Harvey to come up and give it another try.

15 MS. HARVEY: Okay. How’s that? It’s not

16 on? Hello? Okay. I’m Anne Harvey from the 

17 Sierra Club and I’ll be offering comments on both 

18 subparts today. 

19 Thank you for the opportunity to speak 

20 with you. The Sierra Club is pleased that EPA is 

21 extending the Mandatory Greenhouse Gas Reporting 

22 Rule to embrace oil and gas systems and carbon 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

34

1 capture and sequestration. Although both 

2 categories should have been included when the 

3 rule was first released, if EPA sticks to its 

4 plans to require this additional data collection 

5 beginning in 2011, they will only lose a year. 

6 It’s important that EPA stay the course as sound 

7 source-specific data on these industries bears 

8 centrally on our energy future and belongs in the 

9 comprehensive reporting system that Congress 

10 requested EPA to develop. 

11 These remarks focus on the broad 

12 structure of the overall proposal. We’re 

13 developing detailed technical comments on both of 

14 the proposed rules, but for now offer the 

15 following observations.

16 With regard to carbon dioxide injection 

17 and geological sequestration, using long-term 

18 geological sequestration to rapidly control 

19 carbon dioxide emissions is a risky strategy. It 

20 is far from clear that an appreciable portion of 

21 the power plant fleet could be cost effectively 

22 retrofitted with carbon-capturing sequestration 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

35

1 technology or that long-term storage will 

2 succeed. Moreover, to the extent that CCS 

3 extends the lives of existing coal power plants, 

4 it maintains American dependence on a fuel with 

5 enormous public health and environmental costs. 

6 For these reasons, the Sierra Club generally 

7 favors energy strategies that instead primarily 

8 emphasize efficiency, renewable power and shifts 

9 to lower carbon fossil fuel sources. If CCS is 

10 to be implemented at all, the Club believes it 

11 will be most useful for lower carbon gas power 

12 plants rather than for coal facilities. 

13 Nonetheless, if CCS is to play a role, it 

14 must be conducted and monitored with the utmost 

15 care. The regulatory framework to ensure CCS is 

16 properly controlled is incomplete, but should 

17 ultimately cover at the least proper subsurface 

18 injection practices under the Safe Drinking Water 

19 Act, airside monitoring under the Clean Air Act 

20 and a detailed liability and enforcement 

21 structure. 

22 The airside protocols in this role which 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

36

1 focus on detecting and reporting atmospheric 

2 leaks from CCS facilities, are a necessary 

3 supplement to EPA’s proposed Safe Drinking Water 

4 Act underground injection control rules which 

5 focus on protecting underground sources of 

6 drinking water. 

7 We encourage EPA to consider how both of 

8 these rules would interact with and support a 

9 liability and enforcement system. 

10 We support EPA’s decision to require 

11 basic monitoring for all enhanced oil recovery 

12 and injection operations and to enhance 

13 monitoring for CCS projects. 

14 To ensure this airside protocol works, we 

15 ask that EPA carefully think through several 

16 issues in their proposed rule – first, national 

17 standards and local geology. EPA based its 

18 system upon monitoring, reporting and 

19 verification plans which set out a facility 

20 strategy for detecting leaks and verifying their 

21 reported injection quantities are accurate. 

22 Because variation in regional geology makes 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

37

1 designing a uniform national plan difficult, EPA 

2 proposes to review MRV plans on a case by case 

3 basis. 

4 While we agree that these plans should be 

5 tailored to regional conditions, we’re concerned 

6 that the rule may not provide sufficient guidance 

7 to guarantee a consistent level of quality across 

8 plans or to ensure the reports from different 

9 facilities are readily comparable. We would urge 

10 EPA to provide further structure to the case by 

11 case plan requirement by, for instance, 

12 identifying baseline accuracy and provision 

13 standards that all plans must meet, ranking 

14 preferred monitoring technologies which may be 

15 used in many instances, and providing regulatory 

16 standards charting out in some detail, elements 

17 all plans must contain and questions all plans 

18 must consider. EPA should, in other words, 

19 ensure that regional variations do not 

20 inadvertently diminish the rigor of overall 

21 reporting structure. 

22 Regarding public involvement and EPA 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

38

1 review, both Congress’s original Request for 

2 Reporting Rule and Section 114 of the Clean Air 

3 Act on which the Reporting Rule is based, 

4 recognize the public’s vital interest in 

5 emissions data. 

6 Because CCS projects bear directly on 

7 efforts to control global climate change, a 

8 matter of enduring public concern, the CCS 

9 reporting systems must be particularly 

10 transparent. Unfortunately, the proposed rule 

11 lacks some of this transparency. The crucial MRV 

12 plans in particular appear to be developed 

13 entirely without public involvement or review. 

14 Similarly, the proposed rules preamble posits 

15 that CCS operators might be able to challenge 

16 inappropriate plans before the Environmental 

17 Appeals Board, but does not discuss public 

18 challenges. 

19 This is a major oversight. EPA has a 

20 strong interest in ensuring that MRV plans are 

21 strong and effective. Public review supports 

22 this interest. Allowing only operator challenges 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

39

1 to MRV plans would bias the review process away 

2 from rigor. 

3 The final rule should ensure that MRV 

4 plans are offered for public comment and that the 

5 public and CCS operators have parallel rights to 

6 challenge EPA’s approval of an MRV plan. 

7 Regarding timing and comprehensiveness, 

8 CCS operations should only go forward if 

9 monitoring and reporting procedures are in place 

10 before injection, and monitoring should continue 

11 well after injection has finished. The proposed 

12 rule raises some concerns but also has some 

13 success in this regard. 

14 First, the proposed rule gets one big 

15 picture point exactly right and includes every 

16 CCS facility. That choice makes sense. EPA 

17 needs a comprehensive picture of the industry.

18 Second, on an unfortunate note, the 

19 proposed rule allows facilities to put off 

20 finalizing their MRV permits for as much as a 

21 year after they receive an injection permit. 

22 That’s unacceptable particularly because MRV 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

40

1 plans are supposed to include baseline monitoring 

2 of pre-injection condition. Monitoring needs to 

3 be in place before the final UIC permit issues, 

4 making sure that that happens is a good 

5 opportunity to coordinate air and drinking water 

6 programs. 

7 Third, we are concerned that the rule 

8 misses data by exempting research and development 

9 projects. R&D is an unusually important category 

10 for CCS plans as so much of this technology is 

11 experimental or being developed through specific 

12 test facilities. These projects are likely 

13 collectively a large section of the sector and 

14 should not be exempted from the rule.

15 Finally, the proposed rule arguably does 

16 not require reporting for a sufficiently long 

17 period. CCS is useful only if it permanently 

18 sequesters greenhouse gases. EPA needs to know 

19 if long after injection ceases, leaks continue or 

20 commence. Yet the rule currently allows 

21 operators to cease reporting once a facility is 

22 closed and the CO2 plume and pressure front have 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

41

1 stabilized. EPA assumes, apparently, that leaks 

2 will not appear after that point. To be sure of 

3 this assertion, though, EPA needs data that a 

4 longer term monitoring plan would provide. We 

5 must be aware of the containment failures even 

6 long after closure to assess whether CCS 

7 practices are effective. EPA should therefore 

8 consider a long term, relatively low cost leakage 

9 monitoring requirement which would be permanently 

10 applicable to all facilities. 

11 Regarding oil and gas systems, EPA’s 

12 expanded oil and gas monitoring programs is a 

13 major – systems category is a major step forward. 

14 Tracking emissions from well to pump for this 

15 industry is critical. We are particularly 

16 pleased that EPA is moving toward comprehensive 

17 reporting for the entire life cycle of onshore 

18 oil and gas. This is particularly important 

19 because onshore gas development and shale gas is 

20 being touted as a way to replace coal fired power 

21 plants, with natural gas. Accurately measuring 

22 the emissions from these fields including 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

42

1 fugitive emissions of high global warming 

2 potential methane, provides a way to critically 

3 assess these claims and to constrain the 

4 greenhouse gas impacts of this potential 

5 transitional fuel. 

6 We are carefully reviewing the technical 

7 details of EPA’s proposal. On first review, 

8 though, three issues seemed particularly worth 

9 flagging.

10 In our comments on the full reporting 

11 role, we discussed how engineering estimates and 

12 emissions factor-based approaches had often 

13 underestimated emissions, and in particular, 

14 fugitive emissions from oil and gas facilities. 

15 We’re concerned that EPA has moved too far away 

16 from direct measurement in this proposed role in 

17 favor of a range of estimation approaches. We 

18 encourage EPA to carefully consider whether this 

19 decision causes any loss in accuracy and 

20 precision and whether such losses can be 

21 justified given the reporting rules focus on 

22 comprehensive and detailed information.
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

43

1 We also urge EPA to carefully ground 

2 truth estimation methods with regular direct 

3 measurement tests at selected facilities. 

4 With regard to fugitive emissions, we’re 

5 concerned that EPA’s proposal allows companies to 

6 fix fugitive emission sources before quantifying 

7 emissions for the reporting rule. While we 

8 understand that this approach may provide an 

9 incentive for quick repairs, it may also lead to 

10 significant underreporting. We encourage EPA to 

11 consider ways to document such repairs and to 

12 account for emissions that escape before faulty 

13 equipment is fixed. 

14 With regard to life cycle accounting, 

15 EPA’s decision to require production and 

16 processing reporting is particularly important 

17 because oil and gas companies are increasingly 

18 promoting high carbon products like tar sands 

19 oil, liquefied natural gas and oil shale.

20 We encourage EPA to ensure that the 

21 reporting system accurately captures the large 

22 emissions footprint that producing and 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

44

1 distributing these fuels requires. 

2 Thank you again for considering these 

3 remarks. We look forward to working with EPA to 

4 strengthen and extend their reporting 

5 [inaudible].

6 MS. KRUGER: Thank you very much, Anne.

7 MR. GUNNING: Thank you.

8 MS. KRUGER: Okay. Now, Karin Ritter, 

9 American Petroleum Institute.

10 MS. RITTER: Good morning. I’m Karin 

11 Ritter. I’m Regulatory and Scientific Affairs 

12 Department at API. Can everyone hear me? Need 

13 to speak louder? 

14 API is the premier trade association in 

15 the oil and natural gas industry with about 400 

16 member companies engaged in all aspects of the 

17 industry. API and its members have been at the 

18 forefront of developing methodologies and 

19 standards for greenhouse gas emissions estimation 

20 and reporting for the industry and beyond for 

21 over a decade, and have provided detailed 

22 comments to EPA during all stages of the 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

45

1 development of applicable mandatory reporting 

2 approaches for all industry sectors.

3 API is pleased to provide initial 

4 comments regarding the proposed subparts W and 

5 RR. API looks forward to providing additional 

6 details throughout the comment period to help 

7 develop a reporting program that is both 

8 practical to implement and that recognizes the 

9 limitations of resources and methods for 

10 quantifying emissions from the vast number of 

11 exceedingly small sources which even when taken 

12 in total will not significantly impact the 

13 national GHG Emissions Inventory. 

14 In reference to the newly proposed 

15 Subpart W, the monitoring and quantification 

16 methods are an improvement from those proposed in 

17 April 2009. Still, API would like to make five 

18 points on the proposal today. 

19 First, the proposed requirements will be 

20 more costly to implement than EPA has estimated. 

21 Because they apply to vastly more industry 

22 activities and sources, EPA’s cost estimates for 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

46

1 impact on the industry are too low by an order of 

2 magnitude.

3 Second, API concurs with EPA’s statement 

4 that, quote, “the facility definitions proposed 

5 in this rule do not impact requirements under 

6 other EPA regulations, for example, new source 

7 review,” end of quote. While here in Subpart W, 

8 there may be a need to cluster equipment in 

9 activities for reporting, the terms used in 

10 conjunction with the facility definitions under 

11 Subpart W should not impact any current or future 

12 aggregation determinations. 

13 EPA should define a simple and innovative 

14 system that balances the data collection and 

15 reporting burden against the amount of emissions 

16 quantified. To achieve this simplification and 

17 balance, API suggests that EPA allow operators to 

18 identify rational reporting units within a basin 

19 that have similar operations, equipment, fluid 

20 properties and physical parameters and enable a 

21 broader use of population average emission 

22 factors and approaches for emissions 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

47

1 quantification. API recognizes that the 

2 reporting threshold determination may still rest 

3 with the basin level facility and the construct 

4 of the reporting units below the basin level will 

5 be implemented in such a manner that they will 

6 cover all relevant operations of a given owner or 

7 operator within the defined basin.

8 Third, API is concerned that the rule 

9 includes inconsistencies and overlap in the 

10 demarcation of the different industry segments 

11 subject to Subpart W. It would be better if the 

12 industry segments were to be defined along 

13 typical ownership and operating arrangements such 

14 as producing well sites and associated equipment, 

15 gathering lines in lateral compression, and 

16 natural gas processing. This would avoid 

17 duplicative reporting. API suggests that EPA 

18 look to the definition of, quote, 

19 “transportation” in NESHAP’s Subpart HHH to 

20 define where natural gas production and 

21 processing ends and where natural gas 

22 transmission begins.
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

48

1 Fourth, another key issue for the 

2 industry is its ability to track and estimate 

3 emissions from field portable combustion devices 

4 that are stationed at a wellhead for more than 30 

5 days in a reporting year. EPA should require a 

6 less resource intensive and complicated approach 

7 that recognizes that this equipment is moved from 

8 well to well or between operators several times 

9 during the year. Similarly, API does not agree 

10 with EPA’s extension of the reporting 

11 requirements to include rental and other 

12 equipment that is neither owned nor operated by 

13 the reporter.

14 And fifth on Subpart W, API requests that 

15 EPA conform the definitions and terminology used 

16 throughout the proposed rule to make them more 

17 consistent to those used by industry. This is 

18 particularly applicable to the rules confusing 

19 mix of expressions used for gas volumes and mass. 

20 For example, the proposed rule uses in its 

21 different sections, industry conditions, ambient 

22 conditions, actual conditions and STP. API 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

49

1 continues to recommend that the rule should stick 

2 with, quote, “industry standard conditions” (60 ̊F 

3 and 14.7psia) since these are the units used in 

4 all the referenced industry standards and are the 

5 common units used for calibrating industry 

6 devices for custody transfer.

7 As far as the proposed Subpart RR, API 

8 has two points. First, API agrees with 

9 statements in the preamble to the proposed rule 

10 that CO2 EOR operations are a, quote, “closed 

11 system” and non-emissive. Therefore, EPA’s focus 

12 on the amounts of CO2 injected would provide a 

13 distorted view of the CO2 material balance and 

14 hence emissions. CO2 EOR is an enhanced oil and 

15 gas production technique in the same vein as 

16 water injection or thermal enhancement. 

17 Therefore, there is no need to define separate 

18 reporting requirements for CO2 EOR under this 

19 subpart, unless the CO2 EOR operator elects to 

20 declare their operations as providing for 

21 geological storage.

22 Second, due to the special nature of 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

50

1 geological storage facilities, API recommends 

2 that a separate facility definition be applied 

3 for operations that are solely dedicated to the 

4 geological storage of CO2. Such a facility 

5 definition should be consistent with requirements 

6 under other regulatory programs for similar 

7 operations. Also, API recommends that EPA extend 

8 the GS facility R&D exemption beyond federally 

9 funded R&D programs.

10 In conclusion, API looks forward to 

11 working with the agency to develop efficient, 

12 practical and cost-effective reporting 

13 requirements. Our written comments will include 

14 further details on these and other points I’ve 

15 made today. Thank you.

16 MS. KRUGER: Thank you, Karin. Peter 

17 Zalzal.

18 MR. ZALZAL: Good morning. My name is 

19 Peter Zalzal and I’m an attorney with the 

20 Environmental Defense Fund. I’m going to provide 

21 brief comments on both Subpart W and Subpart RR.

22 On behalf of the Environmental Defense 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

51

1 Fund and our more than 700,000 members 

2 nationwide, I sincerely thank you for the 

3 opportunity to testify today.

4 Emissions data is the cornerstone of 

5 effective air quality management. Moreover, an 

6 effective emissions reporting program promotes 

7 transparency, raising awareness of emissions 

8 among reporters and other stakeholders and 

9 contributing to efforts to identify and to carry 

10 out reductions. EPA’s petroleum and natural gas 

11 and injection and geological sequestration 

12 reporting rules allow EPA to collect essential 

13 information providing data for policymakers and 

14 transparency for reporters and the public at 

15 large.

16 As to Subpart W, the U.S. petroleum and 

17 natural gas industry is sizeable encompassing 

18 hundreds of thousands of wells, hundreds of 

19 processing facilities and over a million miles of 

20 transmission and distribution pipelines. 

21 Collectively, these facilities produce 

22 significant greenhouse gas emissions which EPA 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

52

1 estimated 351 million metric tons of CO2

2 equivalent or roughly 11 percent of all emissions 

3 covered by EPA’s final mandatory greenhouse gas 

4 reporting rule. Given the considerable scope of 

5 these emissions, collecting facility level 

6 greenhouse gas emissions data from this sector is 

7 essential. Moreover, to maximize the benefits of 

8 the reporting rule, the rule must reinforce the 

9 two pillars of any well-designed reporting 

10 scheme. The rule must capture the proper scope 

11 of emissions and it must produce accurate data. 

12 EPA’s proposal requires reporting from 

13 industry segments that are critical for a 

14 rigorous, comprehensive reporting scheme. For 

15 example, EDF strongly supports EPA’s inclusion of 

16 the onshore oil and natural gas production 

17 segment of the industry in the reporting rule 

18 which EPA estimates accounts for 66 percent of 

19 fugitive emissions. 

20 Inclusion of this data is critical to 

21 ensure that overall data from the oil and gas 

22 sector accurately represents emissions and to 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

53

1 provide robust information for policy makers 

2 deciding among different GHG mitigation 

3 strategies.

4 EDF likewise supports EPA’s definition of 

5 an onshore production facility. By requiring 

6 facilities to report at the basin level, EPA has 

7 captured roughly 81 percent of emissions from the 

8 onshore production segment. While the 

9 alternatives EPA considered would provide 

10 substantially less emissions coverage without 

11 significant methodological differences.

12 We are concerned, however, that the 

13 agency excluded waste pit facilities from the 

14 proposal, and we are eager to look more closely 

15 at this issue and provide EPA with additional 

16 detail in our written comments. 

17 In all, EPA’s proposed oil and gas 

18 reporting rule is an important step in providing 

19 policymakers and the public with data from the 

20 oil and gas sector facilitating sound greenhouse 

21 gas policy decisions. 

22 Accuracy is also an essential element of 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

54

1 a robust reporting scheme. And EDF hopes that in 

2 its final rule, EPA will select monetary methods 

3 that strengthen the accuracy of emissions data 

4 providing policymakers with the best possible 

5 information. 

6 As a general rule, emissions data derived 

7 from direct measurement is more accurate than 

8 data derived from engineering estimates and 

9 emissions factors. In the oil and gas sector, 

10 this rings especially true because emissions 

11 factors tend to be based on older sources of data 

12 and considerable variability can exist between 

13 sites due to differences in operations and 

14 maintenance conditions. For example, although 

15 two oil and gas sites may have the same number of 

16 components and types of equipment, if the 

17 operator of one site invests considerably more 

18 resources into maintenance and leak detection of 

19 his equipment, the overall leak rate on a per20 component basis for that site will be much less 

21 than alternative sites. Components with higher 

22 occurrence of leaking such as compressors and 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

55

1 equipment with less rigorous or dated emissions 

2 factors, should therefore be required to utilize 

3 direct measurement over engineering estimates.

4 As to Subpart RR, EDF likewise greatly 

5 appreciates the Agency’s leadership in requiring 

6 reporting from facilities engaged in injection 

7 and geologic sequestration of CO2. EPA’s proposed

8 rule provides important data in addition to the 

9 information provided in Subpart PP of the final 

10 reporting rule.

11 Enhanced oil recovery provides key data 

12 on the efficacy of sequestration. Moreover, a 

13 key issue with geologic sequestration and carbon 

14 capture and storage is the durability and 

15 permanence of the storage. Durability is 

16 especially important given that 67 percent of 

17 total CO2 emissions come from fossil fuel 

18 combustion and 95 percent of the 500 largest 

19 stationary sources are within 50 miles of a 

20 candidate GS reservoir. 

21 Data from EPA’s proposed reporting rule 

22 will likewise provide much needed transparency on 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

56

1 the amount of CO2 injected and geologically 

2 sequestered in the U.S. and will allow EPA to 

3 track the flow of CO2 across the CCS system. 

4 This information will allow EPA to 

5 monitor the efficacy of GS and CCS over time 

6 aiding policymakers and evaluating mitigation 

7 options. EDF likewise notes that monitoring 

8 verification and reporting is an important 

9 element of the CCS reporting rule. And we 

10 encourage the agency to bring the same 

11 transparency to the MVR process as the agency has 

12 brought to the rest of the final reporting rule. 

13 This will allow for public participation in the 

14 MVR process and will ensure public awareness of 

15 monitoring and verification at specific sites.

16 EDF greatly appreciates the Agency’s 

17 efforts to cover this important source of GHG 

18 emissions. We greatly appreciate the Agency’s 

19 leadership in developing greenhouse gas reporting 

20 rules reflected in the oil and gas and geologic 

21 sequestration and CCS proposals. These rules 

22 will provide additional foundational data to the 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

57

1 agency policymakers and the public allowing 

2 informed policy decisions and addressing 

3 American’s right to know regarding the largest 

4 greenhouse gas emitters. 

5 Thank you again for the opportunity to 

6 provide testimony today and we look forward to 

7 offering more detailed comments on the agency’s 

8 proposed rulemakings in our written submissions.

9 MS. KRUGER: Thank you very much, Peter. 

10 Kipp Coddington. While Kipp is coming up here, 

11 I’ll say it again. If anyone is interested after 

12 he finishes, I’ll open the floor and we can have 

13 any additional remarks that people might want to 

14 make. 

15 MR. CODDINGTON: And I’ll be exceedingly 

16 brief. I’m Kipp Coddington. I’m outside counsel 

17 to the North American Carbon Capture and Storage 

18 Association. And NACCSA is pleased to offer this 

19 brief statement on the proposed Subpart RR rule 

20 only. 

21 Just a brief note about NACCSA. NACCSA 

22 is a nonprofit organization of companies in North 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

58

1 America that support the development of a 

2 sustainable CCS industry in the United States and 

3 Canada. The members of NACCSA include companies 

4 involved in developing commercial processes to 

5 mitigate greenhouse gas emissions through CCS and 

6 specialists engaged in the technical, commercial, 

7 financial and development aspects of carbon 

8 capture and storage activities in both the U.S. 

9 and Canada. 

10 We would first like to thank EPA for its 

11 work that it’s done on carbon capture and storage 

12 to date. And we recognize your recognition of 

13 the important role that carbon capture and 

14 storage can play in carbon management schemes 

15 going forward. The reporting proposal marks the 

16 latest effort by EPA to shed critical regulatory 

17 clarity on the topic. 

18 As NACCSA commented in its submittal on 

19 the agency’s proposed rulemaking for the 

20 commercial scale injection and storage of CO2

21 under the underground injection control program 

22 of the Safe Drinking Water Act, establishment of 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

59

1 a stable, predictable and workable regulatory 

2 framework for CCS that appropriately encourages 

3 the development of a CCS industry to manage 

4 missions and maximize energy recovery is of 

5 paramount importance. Including reporting on CCS 

6 within the scope of the existing GHG reporting 

7 rule is a prudent next step in reassuring 

8 regulators and the public alike that geologic 

9 storage is in well-sited and well-managed 

10 formations results in sequestration.

11 Now just some brief general observations 

12 about the proposal. NACCSA is still evaluating 

13 the details of the proposal and we will be 

14 submitting more detailed written comments during 

15 the rulemaking period. Also, our comments are 

16 restricted here to the so-called Tier 2 reporting 

17 that only applies to sequestration sites. 

18 First, overall, we commend EPA for 

19 creating an opt in mechanism for geologic storage 

20 sites as opposed to dictating an overly 

21 prescriptive one-size fits all approach that 

22 might endeavor to apply to any entity that was 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

60

1 injecting CO2 regardless of whether sequestration 

2 was claimed to be occurring.

3 Secondly, we also support EPA’s efforts 

4 to tie Tier 2 reporting to the extent possible 

5 into the pending UIC CCS proposed rule. It is 

6 important that geologic storage site owners and 

7 operators not be subjected to duplicative or 

8 potentially conflicting reporting requirements 

9 under various regulatory programs. And at first 

10 blush, it appears that EPA has endeavored to 

11 mitigate those concerns here.

12 Lastly, we expect to have further 

13 comments on the monitoring, reporting and 

14 verification aspects of Tier 2 reporting which of 

15 course we will provide in written comments during 

16 the comment period on the proposal. 

17 Our initial reaction to the MRV 

18 reporting, however, is that it could be somewhat 

19 prescriptive and may not leave room for other 

20 approaches, for example, such as standards and 

21 protocols developed through consensus-based 

22 procedures that industry may have already done or 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

61

1 may be conducting in the future.

2 So with these comments, NACCSA 

3 appreciates the opportunity to be here today and 

4 again, we commend the Agency for the excellent 

5 work it’s done to date on advancing carbon 

6 capture and storage. Thank you for your time.

7 MS. KRUGER: Thank you very much for 

8 those remarks. Thank you.

9 So now there’s an opportunity if there’s 

10 anyone else who wants to speak. I did hear from 

11 someone during the earlier break. Phillip 

12 Marston, if you would like to say a few words.

13 MR. MARSTON: Good morning. Thank you. 

14 My name is Phillip Marston on behalf of Marston 

15 Law. And I’m presenting just a few very brief 

16 comments on behalf of Denbury Resources. As you 

17 know, Denbury Resources is one of the larger 

18 players in CO2-based EOR injections, and we’ll be 

19 following the rulemaking very closely.

20 We appreciate the fact that there’s an 

21 effective recognition of CO2-based EOR as one of 

22 if not the most likely paths forward towards the 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

62

1 actual application of CCS technologies and 

2 practices. And I think that that’s a very 

3 important aspect of your proposed rule. We 

4 anticipate providing more detailed and technical 

5 comments in June, but I think that the broad 

6 structure that you’ve put forward is a reasonable 

7 and sensible one and we look forward to providing 

8 you details to try to help you get where you’re 

9 trying to go on this.

10 That’s all. Thank you very much. 

11 MS. KRUGER: Thank you for those 

12 comments. Thank you. 

13 Is there anyone else who did not make 

14 themselves known to the person at the 

15 registration desk that wants to make remarks at 

16 this time? Going once, going twice. Okay. If 

17 not, then what we’re going to do is take a break 

18 until 11:15 at which time we’ll go into a holding 

19 mode to see if anyone else shows up that would 

20 like to speak. But as of now, we’ve heard from 

21 everyone who had signed up on the web and made 

22 themselves available to give comments to us. And 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

63

1 I would like to thank all of the commenters this 

2 morning. There was a great deal of insight and 

3 technical richness in the comments. And we very 

4 much appreciate the chance to hear them from you. 

5 I know you’ll be following up in writing and 

6 lastly I’ll say that we have throughout this 

7 entire rulemaking exercise, had an open door 

8 policy to people who want to come in and offer us 

9 more information about your experiences and what 

10 you’re doing. We continue to have that policy, 

11 and so we hope that if you’ve got something you’d 

12 like to tell us, you will avail yourself of that 

13 opportunity. It is through this kind of input 

14 that we can do a better job and have rules that 

15 meet our objectives for reporting that are also 

16 not burdensome and make good technical sense. 

17 So thank you everybody and if you want to 

18 see what happens in the afternoon, you can come 

19 back at 11:15. 

20 [Break.]

21 MR. GUNNING: So, good morning. It’s 

22 approximately 11:15. We are now reopening the 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

64

1 floor. Is there anybody who wants to offer 

2 additional comments on either Subpart W or 

3 Subpart RR? 

4 Noting that there are no additional 

5 comments at this particular point in time, I will 

6 be transitioning the chairmanship of the hearing 

7 over to my colleague, Akachi. We will keep the 

8 floor open for an additional 45 minutes or so and 

9 will be breaking for lunch at noon for 

10 approximately one hour, and reopen the floor 

11 again at 1:00. 

12 Thank you.

13 [Break.]

14 MS. IMEGWU: All right. Right now it’s 

15 12:00 noon. There is no one here in the room for 

16 the public hearing for Subparts W and RR, so 

17 we’re going to take a one hour break for lunch. 

18 We will resume opening the floor at 1:00 p.m. at 

19 which point I’ll turn it over to Katie Sibold who 

20 will chair the rest of the hearing. Thank you.

21 [Break.]

22 MR. FERNANDEZ: It’s now one o’clock on 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

65

April 19t h 1 . We are opening the public comment for 

2 Subpart W and RR for the Mandatory Greenhouse Gas 

3 Reporting Rule. Currently there are no 

4 participants in the audience and therefore no one 

5 who is going to give public comments immediately, 

6 but we will be here until approximately five 

7 o’clock such that we meet all obligations as per 

8 the regulations and rules regarding the open 

9 public comment period.

10 [Break.]

11 MR. FERNANDEZ: It is currently 4:52 on 

April 19t h 12 , 2010. My name is Roger Fernandez. We 

13 have had the public comment period open since 

14 9:00 a.m. today in regard to Subpart W and 

15 Subpart RR for the Mandatory Greenhouse Gas 

16 Reporting Rule draft rules which are currently 

17 out for public comment. There have been no 

18 individuals who have come to the public hearing 

19 since 11:00 a.m. today. We had an open forum 

20 from 9:00 a.m. until 11:00, took all comments and 

21 have remained here in place per the public notice 

22 stating that we would have an open meeting for 
OLENDER REPORTING, INC.

1100 Connecticut Ave., N.W., Suite 810, Washington, D.C. 20036

Washington: (202) 898-1108 / Baltimore: (410) 752-3376

Toll Free: (888) 445-3376

66

public comment until 5:00 p.m. on April 19t h 1 ,

2 today.

3 As I stated, it currently now 4:55 and no 

4 individuals have come since 11:00 a.m. and 

5 therefore we are going to close this meeting for 

6 public comment for Subparts W and RR for the open 

7 comment period. 

8 The written comments still are open per 

9 the instructions that were issued in the Federal 

10 Register and this concludes the open comment 

11 period session for these subparts for oral 

12 comments.

13 Thank you very much.

14 [Whereupon, at 5:00 p.m., the Public 

15 Hearing concluded.]