Texas should lead in promoting carbon capture regulation
Few places can match Texas’ experience with oil and gas exploration. From Spindletop and the dawn of the oil era to George Mitchell and the rise of hydraulic fracturing, Texas has led the way in energy exploration innovation. Today, that spirit of innovation continues with new technologies that capture carbon dioxide to be stored or reused later.
To ensure that these technologies are used to their fullest, the state will also need to recapture some of the regulatory authority it has ceded to Washington, D.C.
Let’s start with the basics. Oil and gas production generates several by-products, including carbon dioxide emissions. Many are concerned about the long-term effect that these emissions are having on the climate. Whatever you think about that issue, it is undeniable that carbon dioxide can itself be a valuable commodity. In addition to being used for things like the carbonation in Coca-Cola or beer, carbon dioxide can be used in enhanced oil recovery to help wells increase their productive life. This means that if CO2 could be captured and repurposed affordably, it could provide an additional profit source for power plants.
Texas has been at the center of these developments. In fact, the lion’s share of carbon capture and storage projects in operation or under construction are located in Texas. In 2017, the Petra Nova coal plant in Thompson, Texas, was the first large-scale U.S. power plant to adopt carbon capture and storage. Today, Net Power — a natural gas plant in La Porte — uses a special process that it claims allows it to capture its carbon emissions without increasing costs beyond those of a typical natural gas plant.
Given Texas’ long experience with all aspects of oil and gas development, it would make sense for the state to have the primary authority of making sure that production and storage occur in a safe and environmentally responsible way. After all, the Texas Commission on Environmental Quality — the state agency responsible for air quality — is the second-largest environmental regulator in the United States, and in many areas, it has more expertise than even the federal Environmental Protection Agency. Meanwhile, the Texas Railroad Commission has been dealing with well safety issues for over a century.
Over the years, large amounts of authority over these areas have been transferred to federal bureaucrats in D.C. Yet when it comes to carbon capture and storage, there is a way for Texas to reclaim some of this authority. Federal law allows states to apply for “primacy” in enforcement of regulations governing different classes of wells, including the “Class VI” injection wells that would be used for storing CO2. While Texas, along with most other states, has been granted primacy over various well types, Class VI wells have remained under federal oversight.
But with the Trump administration showing a willingness to devolve power back to the states, that is starting to change. In 2018, North Dakota became the first state to successfully regain primacy over Class VI wells, and several other states have applied for primacy in its wake. These developments have created an opportunity for states like Texas to regain some control over an important industry.
If Texas wants to continue to lead in energy, it should apply for primacy and show how states can do a better job promoting innovation and protecting the environment than the federal government.
Image credit: S.Borisov