EPA Issues Supplemental Proposed Rule to Maintain Transparency for Secure Geologic Storage Operations Under the Greenhouse Gas Reporting Program
June 22, 2023 | News
In late May, the Environmental Protection Agency (EPA) released a re-proposed supplemental rule – Revisions and Confidentiality Determinations for Data Elements Under the Greenhouse Gas Reporting Rule – that makes changes to the Greenhouse Gas Reporting Program (GHGRP) to include adding direct air capture to Subpart PP and the creation of Subpart VV under the program. The Carbon Capture Coalition provided comments to EPA on the original proposed rule in October 2022 and supported these proposed mechanisms to promote transparency in existing reporting mechanisms for secure geologic storage of carbon dioxide (CO2).
Robust monitoring, reporting and verification (MRV) is a central policy of the 45Q tax credit and thus a foundational aspect of the Coalition’s work. Strong public transparency, reporting and oversight provisions are vital to maintaining public and policymaker support of the 45Q tax program. Integral to the MRV process are the reporting requirements required to elect the tax 45Q credit for secure geologic storage, established through the EPA’s GHGRP. The reproposed supplemental rule adopts the Coalition’s recommendation to require the use of Subpart VV for those CO₂-EOR operators who opt-in to reporting through ISO 27916, a recommendation the Coalition has been supporting since before the Treasury and IRS issued guidance for the Section 45Q tax credits in 2021.
As part of the Coalition’s 2022 comments to EPA, the Coalition also provided feedback on whether EPA should add CO2 utilization (beyond the purposes for use in EOR operations) as a source category in part 98 of GHGRP, as currently, there is not a source category strictly related to CO2 utilization. Already, carbon reuse companies wishing to elect the 45Q tax credit must provide a cradle to grave lifecycle assessment to Treasury and IRS, which is subsequently reviewed and approved by the Department of Energy before receiving credit. In initial comments, the Coalition urged EPA to take the time necessary and give due consideration to the creation of any reporting program for the nascent CO2 utilization industry to avoid inadvertently creating further barriers to the deployment of these climate essential technologies.
The re-proposed rule does not address the addition of a source category relating to CO2 utilization. As part of the development of additional comments on the re-proposed rule, the Coalition will also be inquiring with EPA to gain further insight into agency learning and considerations relating to the potential for this new source category. EPA is accepting comments on this re-proposed rule until July 21, 2023.
As part of the publication in the Federal Register, EPA is proposing that the rule revisions, if finalized, would become effective on January 1, 2025, and that reporters would implement the changes beginning with annual GHG reports prepared for the 2025 reporting year and submitted on or before March 31, 2026. An exception is proposed for current GHGRP reporters: if the rule revisions are finalized, reporting amendments would apply to annual GHG reports prepared for calendar year 2024 and submitted on or before March 31, 2025.
- View the proposed rule in the Federal Register (published May 22, 2023).
- View EPA’s fact sheet on the supplemental proposed rule.
- View the rulemaking docket on the Revisions and Confidentiality Determination for Data Elements Under the Greenhouse Gas Reporting Rule.
Convened by the Great Plains Institute, the Carbon Capture Coalition is a nonpartisan collaboration of more than 100 companies, unions, conservation and environmental policy organizations, building federal policy support to enable economywide, commercial scale deployment of carbon management technologies. This includes carbon capture, removal, transport, utilization, and storage from industrial facilities, power plants, and ambient air.