Groningen Centre of Energy Law (GCEL) presents its first research results on Carbon Capture and Storage at Energy Delta Convention

Since GCEL was launched in 2006, research has focused on the issue of Carbon Capture and Storage (“CCS”). The first results of this research were presented at the fourth edition of the Energy Delta Convention, which was held at the Martiniplaza in Groningen from 17 to19 November 2008. CCS is considered as one of the innovative methods to reduce CO2 emissions and as an important instrument to meet the Kyoto targets. The EU Commission presented a draft directive on CCS at the beginning of 2008. This draft has been the basis for research by GCEL and involves the participation of some 20 members of the Faculty of Law at the Groningen University.

The research of GCEL is unique as it concentrates on the legal issues concerning CCS. Due to the wide range of legal topics involved, GCEL organised two separate sessions on CCS. During the first session on 18 November, the issue of CCS was presented by representatives from government (EU Commission), academia (GCEL) and industry (Shell). This session was chaired by Prof. dr. Martha Roggenkamp and Dr. Edwin Woerdman (iniators and directors of GCEL). Mr. Mihai Tomescu from the EU Commission started with a presentation of the draft directive on ‘enabling a legal framework for carbon dioxide capture and geological storage’. He addressed in his paper the relationship with the EU Emissions Trading Scheme, the financing of CCS demonstration projects, the discussion regarding the need to make CCS mandatory, liability following CO2 leakage and the transfer of liability to the state. Other issues raised were the composition of the CO2 stream and the need for reviewing draft storage permits by the Commission.
See presentation.

Market
Thereafter Dr. Hans Vedder (GCEL) discussed the establishment of a CCS market. After analysing the main characteristics of a CCS market and the instruments to create and to develop a CCS market, he discussed how to maintain a CCS market and how to deal with competition issues.
See presentation.

Industry
Finally, Hans van der Meer (Shell), replacing his colleague Chris Mansfield, discussed the regulatory principles for CCS from an industry point of view. He analysed the key principles, the key uncertainties and the key challenges for establishing a proper framework for CCS. He concluded that the EU is on the right track but also that much more needs to be done within a short period of time before a proper legal framework is in place.
See presentation.

Environment
On 19 November the session on CCS was chaired by Dr. Hans Vedder. During this session several members of GCEL presented their research, which covers in-depth analyses of parts of the CCS-chain. Dr. Kars de Graaf started with a paper on ‘regulating point emitters’ and focussed on the impact of environmental law on CCS. He discussed in particular the possible need to make CCS mandatory, the change in the regulation on Environmental Impact Assessment and whether it is a wise not to treat CO2 as waste.
See presentation.

Subsoil storage
Subsequently Prof. Martha Roggenkamp discussed the subsoil storage of CO2 as included in the draft CCS Directive. In particular she compared the permitting regime for CO2 storage and the regime of the Hydrocarbons Licensing Regime. She raised whether a more integrated approach towards storage of gas and CO2 would be preferable and a possible new role for State (oil) companies in order to make CCS profitable.
See presentation.

Liability
Prof. Mark Wissink then discussed the issue of post-injection liability. He concluded that the EU Proposal should make clear whether and to what extent it covers post-injection liability for CO2 storage sites. He also concluded that post-injection liability in Dutch law should be channelled to one single entity.
See presentation.

Emissions trade
Finally ‘CCS in the EU ETS and Clean Development Mechanism (CDM)’ was discussed by Dr. Edwin Woerdman and Mr. Anatole Boute. Prof. Woerdman argued that emissions trading is the cornerstone of EU climate policy and that CCS is an additional option to reach the CO2emission reduction targets. The price of emission allowances should determine the profitability of CCS. As climate change is a global issue and directly related to energy production,Mr. Boute discussed the relevance of including CCS in CDM projects.
See presentation.

Emissions Trading
Finally ‘CCS in the EU ETS and Clean Development Mechanism (CDM)’ was discussed by Dr. Edwin Woerdman and Mr. Anatole Boute. Dr. Woerdman argued that emissions trading is the cornerstone of EU climate policy and that CCS is an additional option to reach the CO2 emission reduction targets. The price of emission allowances should determine the profitability of CCS. As climate change is a global issue and directly related to energy production, Mr. Boute discussed the relevance of including CCS in CDM projects. [presentatie]

Discussion

The session was concluded with a panel discussion involving representatives from GCEL (Prof. Marcel Brus and Prof. Irene Burgers), industry (mr. Klaas Lemstra) and government (ms. Hedwig Verhagen). They inter alia discussed the need for a coordinated fiscal approach to CCS on EU level, the desirability of introducing the concept of Best Available Regulations for legally enabling CCS and the importance of proper site selection.
See presentation by Brus.
See presentation by Burgers.
See presentation by Lemstra.

The Energy Delta Convention 2008 was a succesful conference and GCEL is pleased with the interest in its research on legal issues of CCS. The research will be completed in the spring of 2009, thereby taking into account the final developments, i.e. the entry into force of the CCS-Directive. A monograph entitled “Designing a legal Framework for Carbon Capture and Storage” will be published in the summer of 2009 by publishing house Intersentia.
See flyer.