The U.S. Environmental Protection Agency (EPA) on Oct. 13 granted Colorado permitting authority over Class VI injection wells, which store carbon dioxide underground.
The transfer will also put Colorado’s regulatory priorities to the test: whether the state can efficiently permit carbon storage projects while imposing increasingly demanding requirements on conventional oil and gas development.
State permitting authority
Starting November 12, the Colorado Energy and Carbon Management Commission (ECMC) will be the primary permitting authority for these wells except on tribal lands, where EPA will remain in charge. Colorado joins six other states that permit their own injection wells for carbon sequestration: North Dakota, Wyoming, Louisiana, West Virginia, Arizona, and Texas.
Injection wells put fluids into geologic formations for disposal, storage, or oil, gas, and mineral recovery. Colorado has been in charge of permitting Class II oil and gas injection wells since 1984, but Class VI wells are intended to sequester carbon dioxide deep underground for long-term storage. EPA designated the new category in 2010 in part because carbon dioxide can become corrosive in water. Operators are required to monitor sites “for at least 50 years” after injection stops unless otherwise allowed, and property deeds must reflect sequestration “in perpetuity.”
Moving permitting decisions from federal oversight to state regulators is nothing new. North Dakota got primacy over Class VI permits in 2018 and has since issued eight such injection well permits and nine carbon storage facility permits. EPA only has eight projects totaling 13 wells with active permits and a long backlog that spurred more states to seek primacy in the first place.
Colorado stricter than EPA
To gain permitting authority, Colorado had to demonstrate that it would hold to standards at least as stringent as EPA’s. Colorado currently does not have any operating Class VI injection projects. Only one permit, to an ethanol plant near Windsor, and a second, early-stage application, will be transferred to Colorado after November 12.
While EPA only requires states to match its standards, ECMC will be stricter than EPA — but that should come as no surprise. Like oil and gas wells in Colorado, ECMC will require Class VI wells to be at least 2,000 feet away from residences, schools, and commercial buildings. The applications will also require a “Commission-approved development plan, surface-location review under SB19-181,” and more. Senate Bill 19-181 is the same law that redefined the mission of the state oil and gas commission from fostering oil and gas development to regulating it.
ECMC writes that “Colorado prioritizes Environmental Justice,” which will mean that proposed wells will be denied “if there are net negative impacts on disproportionately impacted communities.”
Colorado’s rules will reflect the state’s priorities, and carbon storage in pursuit of net-zero emissions is one of them. Colorado’s Class VI injection well program will be a test: if Colorado can’t approve Class VI permits in a timely manner, then its permitting system slows even the projects its own climate goals rely on. But if carbon storage projects move through permitting quickly, while oil and gas permits keep stalling, it’s evidence that ECMC takes its mission to “regulate” oil and gas to the extreme.
Sarah Montalbano is a policy analyst with Independence Institute’s Energy and Environmental Policy Center and a contributor at Always On Energy Research.
