California's pioneering carbon storage project, Elk Hills, has sparked debate over regulatory oversight and environmental responsibility. The project, a joint venture between California Resources Corp. (CRC) and New York investor Brookfield Asset Management, aims to permanently bury carbon dioxide underground. However, the absence of state-specific rules has raised concerns about the project's safety and the responsibility of oil companies if something goes wrong.
The project's financial stakes are high, with potential billions in public money at risk. The project could earn billions in public money, funded partly by federal tax credits and partly by California drivers, if it scales up as planned. The company sees its storage business as aligned with the state's goals and an opportunity to transition into the future. However, the lack of state-specific rules means California cannot hold companies like CRC to a tougher standard than the federal government, or ensure that the carbon stays in the ground.
Environmentalists and oil companies argue about the extent of the rules, with the latter pushing for a swift completion of the regulatory process. The project's emergency plan and permit rely on the Safe Drinking Water Act, but experts highlight a gap in the rules: federal regulations require regular integrity tests only on the injection wells themselves, not the hundreds of older wells around them. This leaves much of the burden on the company to police itself.
The project's environmental review has been challenged in court, with concerns about the project's full range of risks not being fully addressed. The lawsuit argues that the project's environmental review never grappled with where all the carbon will come from, the capturing and piping of carbon from industrial sources into a region already among the most polluted in the country.
The absence of state-specific rules has raised concerns about the project's safety and the responsibility of oil companies if something goes wrong. The project's success hinges on the resolution of these regulatory and environmental challenges, as California's ambitious climate goals depend on the widespread adoption of carbon capture technology.
