Louisiana has gained primary control over where companies can store carbon dioxide underground in the state, after a decision from federal environmental regulators on Thursday.
The state Department of Natural Resources will now be in charge of permitting Class VI injection wells — the kind used for carbon — instead of the Environmental Protection Agency.
It took four years for the EPA to approve the state’s bid for primacy in a controversial decision aimed at mitigating Louisiana’s contribution to climate change.
Louisiana’s new regulatory power comes at a time when the state’s heavy industry looks to clean up its operations by capturing its own planet-warming emissions before they leave the facility and store them a mile beneath the Earth’s surface.
The process, known as carbon capture and sequestration, is viewed as one way to lower the industrial sector’s outsized contribution to climate change, on top of running more efficiently, electrifying more processes and turning to alternative fuels like hydrogen. In Louisiana, two-thirds of the state’s greenhouse gas emissions come from heavy industry.
But environmental groups say a carbon capture boom is not without risk for people living nearby, especially since low-income and Black communities are already disproportionately affected by the state’s heavy industry in areas like the Mississippi River chemical corridor.
Gov. John Bel Edwards applauded the EPA’s decision. His administration worked to position the state to become a major hub for carbon capture projects to allow Louisiana’s existing industry to remain while reducing its environmental footprint.
As interest in storing carbon has skyrocketed, the EPA racked up a backlog of more than 20 proposals Class VI wells in Louisiana alone. The Inflation Reduction Act made the prospect of carbon capture profitable; companies can receive a tax credit for up to $85 per tonne of carbon permanently stored underground.
Louisiana oil, gas and chemical advocates have long supported the state’s application for primacy, stating it will help the burgeoning carbon capture industry progress.
After Thursday’s approval, Louisiana Oil and Gas Association (LOGA) President Mike Moncla said the state “now stands at the forefront” of the carbon capture industry.
“This is a huge victory for Louisiana,” he said in a statement. “LOGA and its members look forward to taking advantage of the tremendous opportunities this presents the state and its workforce.
The primacy application process took more than two years as the EPA and the state worked to add safeguards for public safety and health, ensure meaningful community engagement and avoid environmental discrimination in permitting for carbon capture projects.
“It can be done in a way that builds in environmental justice principles that allow for the community to participate in the process and ensures that these communities are safe,” EPA administrator Michael Regan told the Associated Press Thursday.
But longtime environmental advocates in Louisiana remain skeptical, after opposing the state’s application from the start. They argue the state is underresourced and has failed to properly regulate other wells leading to the proliferation of thousands of abandoned, leaky oil and gas wells dotting the state.
Deep South Center for Environmental Justice Executive Director Beverly Wright said the Louisiana Department of Natural Resources has “a track record of ignoring environmental justice concerns.”
“Today’s decision is simply wrong and leaves Louisiana’s most vulnerable exposed to an untested pollution control technology,” Wright, who also advises the White House, said. “This unproven and dangerous option is one of the biggest threats to communities of color being harmed by the polluting industries that exacerbate our climate crisis and by the regulatory agencies that are supposed to be protecting them.”
The EPA has begun discussing the handover of the Class VI well applications already submitted, and more proposals are expected to pour in with Thursday’s decision.
“We have seen unprecedented interest in carbon sequestration projects over the past couple of years, with companies reaching out to our office to express interest in what the regulatory landscape will be,” Edwards said. “The applications already in with the EPA are just the start.”
