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.Steven L

. Beshear p

. 1

David L

. Armstrong

Governor Chairman

Leonard K

. Peters Commonwealth of Kentucky James W

. Gardner Secretary Public Service Commission Vice Chairman
Energy and Environment Cabinet 211 Sower Blvd

. P .O

. Box 615 John W

. Clay Frankfort, Kentucky 40602-0615 Commissioner Telephone : (502) 564-3940

Fax : (502) 564-3460

psc .ky .gov

November 10, 2008

Water Docket

Environmental Protection Agency

Mailcode : 2822T

1200 Pennsylvania Ave

., NW

. Washington, DC 20460

Re : Docket #EPA-HQ-OW-2008-0390

To Whom

It May Concern : 

## ~OV ~ ~ Lu)

.

On behalf of the Kentucky Public Service Commission, ("KPSC"), I would like to offer

the following comments on the U .S

. Environmental Protection Agency's ("EPA's") proposed Federal Requirements Under the Underground Injection Control ("UIC") Program for Carbon Dioxide ("C02") Geologic Sequestration ("GS") Wells, published in
the Federal Register on July 25, 2008

.

Broadly speaking the proposed rule appears to be intended to help protect underground

sources of drinking water from the possible contaminating effects of injecting massive

amounts of compressed C02 into underground geological formations for long-term geological sequestration

. As over 107 million people within the United States obtain

their drinking water from underground sources-over 400,000 of whom are in the

Commonwealth of Kentucky-it is vital that the nation's drinking water supply be protected from such contamination .'

KPSC also commends EPA for its efforts in formulating the proposed rule, because it

will further the prospect of deploying effective technological solutions to the problem of capturing and sequestering carbon emissions from coal combustion and gasification, as it appears likely that federal legislation to limit carbon emissions will become law in the

future

. 

## NOV 10 zoos

1 See, "FACTOIDS : Drinking Water and Ground Water Statistics for 2007," pp

. 4-5, found at http ://www

.epa .gov/safewater/data/pdfs/data factoids 2007 .pdf

.

KentuckyUnbridledSpirit .com /[~ An Equal Opportunity Employer M/FID

~ ~ Lo"NOLm

wWwrp

. 2

Docket #EPA-HQ-OW-2008-0390 Kentucky Public Service Commission

October 10, 2008 Page Two

Without clear rules to govern the underground injection and long-term sequestration of
C02, the full-scale deployment of C02 capture and sequestration technology on a
nationwide basis could be subject to inconsistent and uncertain treatment under diverse

state regulatory procedures

. That, in turn, could unnecessarily complicate and forestall

the process of effectively dealing with climate change, which would be especially vexing

for states like Kentucky, Indiana, Illinois, Pennsylvania, Virginia, West Virginia, and Wyoming whose coal reserves will continue to be used to ensure the nation's energy independence into the future

.

Furthermore, KPSC supports the goal of EPA's proposed rule to, "enable the continued

use of coal in a manner that greatly reduces the associated C02 emissions while other

safe and affordable alternative energy sources are developed in the coming decades

. ,2

KPSC also supports EPA's "strategy to address climate change through : (1) Slowing the growth of emissions ; (2) strengthenin~g science, technology and institutions ; and (3) enhancing international cooperation ." P

urges EPA to act cooperatively with those regulated entities that will be directly

affected by the implementation of the underground injection rule such that the total

costs of the program can be kept to a minimum

. KPSC encourages EPA to recognize

that this is only one of many new regulations and rules related to carbon capture and sequestration that will have a substantial impact on utilities' costs of service

. Under

traditional rate-making principles and pursuant to specific statutory requirements, the

utilities' ratepayers will ultimately bear the burden of those additional costs

. At a time
when the costs for all utilities are increasing

- such as rising fuel, material, capital and
labor costs - the additional impact of new environmental requirements may prove to be unbearably burdensome to many utility customers

.

Thank you for the opportunity to comment and for your consideration of these

comments in the development of the final rule

. Should you have any questions on the
comments, please contact staff attorney, Rick Bertelson, at (502) 564-3940

.

2 73 Fed

. Reg

. 43,496 (July 25, 2008)

. Sincerely,

3 Id

.

KentuckyUnbridledSpirit .com An Equal Opportunity Employer MIFID

WaRIQLLD 3PIIP?Letter ID: 0231 Commenter: David L. Armstrong Organization: Kentucky P ublic Service Commission

Letter ID: 0231 Comment ID: 21891 Letter Lines: 33 to 66

Comment Code: 1420 1.2.1.1 Support the GS rulemaking

Comment: Broadly speaking the proposed rule appear s to be intended to help protect underground sources of drinking water from the possible contaminating effects of injecting massive amounts of compresse d C02 into underground geological formations for long-term geological se questration. As over 107 million people

within the United States obtain their drinking water from underground sourcesover 400,000 of whom are in the Commonwealth of Kentucky-it is vital that the nation's drinking water supply be protect ed from such contamination. [FN1]

[FN1: See, "FACTOIDS: Drinking Water and Ground Water Statistics for 2007," pp. 4-5, found at http://www.epa.gov/safewater/ data/pdfs/data fa ctoids 2007.pdf.]

KPSC also commends EPA for its efforts in formulating the proposed rule, because it will further the prospect of deploying effective technological solutions to the problem of capturing and sequestering carbon emissions from coal combustion and gasification, as it appears likely th at federal legislati on to limit carbon

emissions will become law in the future.

Without clear rules to govern the underground injection and long-term equestration of C02, the full-scale depl oyment of C02 capture and sequestration technology on a nationwide basis could be s ubject to inconsistent and uncertain treatment under diverse state regulatory procedures. That, in turn, could unnecessarily complicate and forestall the process of effectiv ely dealing with climate change, which would be especially vexing for states like Kentucky, Indiana, Illinois, Pennsylvania, Virginia, West Virginia, and Wyoming whose coal

reserves will continue to be used to ensure the nation's energy independence

into the future.

Furthermore, KPSC supports the goal of EPA's proposed rule to, "enable the

continued use of coal in a manner that greatly reduces the associated C02

emissions while other safe and affordab le alternative energy sources are developed in the coming decades. [FN2] KP SC also supports EPA's "strategy to address climate change through: (1) Sl owing the growth of emissions; (2) strengthening science, technology and institutions ; and (3) enhancing international cooperation ." [FN3]

Individual Response: EPA believes that the creation of a new injection well class (VI) under the existing UIC Program is necessary to enable the use of GS as a climate change mitigation

1technology in a manner that protects USDWs from endangerment. EPA agrees that the UIC Program, under the authority of the SDWA, provides a strong fram ework for regulating injection of CO2 for GS and adds that the GS regulati on tailors the UIC requirements to address the unique issues associated with large-scale GS including large injection volumes, the relative buoyancy of CO2, its corrosivity in the presence of water, the potenti al presence of impurities in captured CO2, and its mobility within subsurface geologic formations.

Letter ID: 0231 Comment ID: 21892 Letter Lines: 68 to 81

Comment Code: 6000 3. Cost of the Proposed Rule

Comment: [FN2: 73 Fed. Reg. 43,496 (July 25, 2008)] [FN3: Id.]

KPSC urges EPA to act cooperatively with those regulated entities that will be directly affected by the implementation of the underground injection rule such that the total costs of the program can be kept to a minimum. KPSC encourages EPA to recognize that this is only one of many new regul ations and ru les related to carbon capture and sequestration that will have a substantial impact on

utilities' costs of service. Under tr aditional rate-maki ng principles and pursuant to specific statutory requirements, the utilities' ratepayers will ultimately bear the burden of those additional costs. At a time when the costs

for all utilities are incr easing -such as rising fuel , material, capital and labor costs -the additional impact of ne w environmental requirements may prove to be unbearably burdensome to many utility customers.

Individual Response: EPA clarifies that the GS rule addresses costs associated with sequestration only, i.e., not capture or transportation. Any impacts on the cost of electricity are likely to be influenced by all aspects of CC S, including capture, tran sport, and sequestration. EPA adds that it does not establish or attempt to influence electric costs –they are set by factors the Agency does not control. Sequestration costs are expected to be a small component of total CCS project costs; EPA estimates that the GS rule requirements amount to approximately 2 percent of the total CCS project costs.

EPA acknowledges that the Class VI requirement s have associated costs beyond baseline (Class I industrial wells) costs. The Agen cy clarifies that the purpose of the GS regulation, promulgated under authority of the SDWA, is to ensure th at, where GS is deployed, it is conducted in a manner that protects USDWs from endangerment.

2