Permitting CO2 Pipelines: Overcoming State and Federal Barriers to CO2 Pipeline Networks

The Infrastructure Investment and Jobs Act of 2021 directed the U.S. Department of Energy (DOE) to support the development of four regional “direct air capture hubs” (DAC Hubs)—networks that connect direct air capture projects with sequestration facilities and commercial users of captured carbon dioxide (CO2). To support these DAC Hubs, the United States will need a nationwide network of CO2 pipelines that transport captured CO2 to long-term storage sites. The Sabin Center for Climate Change Law’s latest paper, Permitting CO2 Pipelines: Assessing the Landscape of Federal and State Regulations, assesses the legal framework for developing CO2 pipelines to support DAC Hub projects. This paper assesses state and federal permitting requirements that may impact CO2 pipelines, identifies barriers to the rapid construction of CO2 pipeline networks, and proposes recommendations for state and federal regulators and lawmakers seeking to overcome those barriers.

Permitting CO2 Pipelines focuses on pipeline regulation at the federal level, as well as in ten states that have been identified as potential candidates for DAC Hubs: Alabama, Arizona, California, Illinois, Louisiana, New York, Oklahoma, Pennsylvania, Texas, and Wyoming. This review assesses five categories of regulation: (1) operational regulation, (2) eminent domain and land assembly, (3) environmental regulation, (4) cultural, heritage, and environmental justice regimes, and (5) safety regimes. While the main body of Permitting CO2 Pipelines addresses themes, trends, and highlights from this review, the paper is accompanied by ten annexes that offer a detailed overview of the regulatory regime in each surveyed state.

This paper builds on prior Sabin Center studies that explore the legal frameworks for carbon capture, removal, and storage, and is published alongside two valuable resources about DAC Hub siting, Expert Insights on Best Practices for Community Benefits Agreements, and the Community Benefit Agreements Database. Permitting CO2 Pipelines was written by Martin Lockman, Climate Law Fellow at the Sabin Center, with support from the ClimateWorks Foundation.

Why Do We Need CO2 Pipelines?

The Intergovernmental Panel on Climate Change has found that “[t]he deployment of carbon dioxide removal” technologies is “unavoidable” if the world is to achieve net zero emissions of greenhouse gases, and that the successful deployment of this technology “depends on developing effective approaches to address feasibility and sustainability constraints[,] especially at large scales.” In response to this challenge, public and private sector actors around the world are researching and deploying a variety of technologies designed to remove greenhouse gasses like carbon dioxide (CO2) from the atmosphere. Some of these technologies, like “direct air capture” facilities that use chemical and electrochemical processes to capture atmospheric CO2 at relatively low concentrations, generate a stream of captured CO2. This stream must either be used or stored in a way that keeps it out of the atmosphere—ideally, for centuries or millennia.

A promising technique to keep CO2 out of the atmosphere involves injecting it into underground rock formations like depleted oil and gas reservoirs, unmineable coal seams, or other sedimentary structures—together, referred to as “geologic storage.” If carefully selected, geologic storage sites are considered “very likely” to retain more than 99% of injected CO2 for at least 100 years, and “likely” to retain more than 99% of injected CO2 over the first thousand years of storage. Considering both onshore and offshore storage sites, known mineral formations in North America may have the geologic storage capacity “to store hundreds or thousands of years of captured CO2 emissions.”

Linking direct air capture facilities to geologic storage sites will likely require a nationwide network of CO2 pipelines. Around 5,000 miles of CO2 pipelines already exist in the United States. These pipelines were primarily built to assist in “enhanced oil recovery,” a process that involves injecting CO2 into geologic reservoirs to displace oil that is then extracted and refined. As a result, existing CO2 pipelines largely connect point-sources of CO2 to active oil fields, and DOE’s most recent estimates suggest that between 30,000 and 96,000 miles of CO2 pipelines will be necessary to reach the United States’ 2050 net-zero emissions goal.

What are the Legal Barriers to Building CO2 Pipelines, and How Can They Be Resolved?

Despite the increasing need for carbon removal and storage to avoid worsening climate change, the vast potential for geologic storage in the United States, the existing network of CO2 pipelines across some regions of America, and the strong support for direct air capture in both the Infrastructure Investment and Jobs Act of 2021 and the Inflation Reduction Act of 2022, U.S. law surrounding CO2 pipelines is characterized by glaring governance gaps. In response to these challenges, Permitting CO2 Pipelines identifies legal barriers to the rapid deployment of an interstate network of CO2 pipelines supporting DAC Hubs, and provides recommendations to help federal and state lawmakers overcome these barriers.

The recommendations contained in Permitting CO2 Pipelines address four key barriers to CO2 pipeline development: (1) ambiguous or patchwork governance regimes at both the state and federal level; (2) economic regulations of interstate pipeline networks that vary from state to state and imperil pipeline land assembly; (3) regulatory approvals, permitting processes, land assembly, and cultural and environmental responsibilities that are scattered among different agencies, subject to different standards, and undertaken with different levels of rigor from state to state and project to project; and (4) gaps in the federal Pipeline and Hazardous Material Safety Administration’s regulations addressing CO2 pipeline safety. In response, this paper recommends that state and federal lawmakers should enact reforms to: (1) clarify regulatory jurisdiction over CO2 pipelines, irrespective of the source, use, or physical state of the transported CO2; (2) decouple land assembly for CO2 pipelines from their economic regulation; (3) formalize and centralize land assembly, eminent domain processes, and environmental permitting processes through either federalization of siting authority or dedicated state-level siting processes; and (4) ensure that all CO2 pipelines are covered by comprehensive pipeline safety regulations.

These barriers, recommendations, and the legal frameworks underlying them, are elaborated upon further in the full paper, Permitting CO2 Pipelines: Assessing the Landscape of Federal and State Regulations. Read the full paper here.