SB1821sam002 97TH GENERAL ASSEMBLY

Sen. John M. Sullivan

Filed: 3/14/2011

09700SB1821sam002 LRB097 08782 ASK 52890 a

AMENDMENT TO SENATE BILL 1821

AMENDMENT NO. ______. Amend Senate Bill 1821 by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Carbon Dioxide Transportation and Sequestration Act.

Section 5. Legislative purpose. Pipeline transportation of carbon dioxide for sequestration, enhanced oil recovery, and other purposes is declared to be a public use and service, in the public interest, and a benefit to the welfare of Illinois and the people of Illinois because pipeline transportation is necessary for sequestration, enhanced oil recovery, or other carbon management purposes and thus is an essential component to compliance with required or voluntary plans to reduce carbon dioxide emissions from "clean coal" facilities and other Illinois sources. Carbon dioxide pipelines are critical to the promotion and use of Illinois coal and also advance economic development, environmental protection, and energy security in the State.

Section 10. Definitions. As used in this Act:

"Carbon dioxide pipeline" or "pipeline" means the in-state portion of a pipeline, including appurtenant facilities, property rights, and easements, that are used exclusively for the purpose of transporting carbon dioxide to a point of sale, storage, enhanced oil recovery, or other carbon management application.

"Clean coal facility" has the meaning ascribed to that term in Section 1-10 of the Illinois Power Agency Act.

"Clean coal SNG facility" has the meaning ascribed to that term in Section 1-10 of the Illinois Power Agency Act.

"Clean coal SNG brownfield facility" has the meaning ascribed to that term in Section 1-10 of the Illinois Power Agency Act

"Commission" means the Illinois Commerce Commission.

"Sequester" has the meaning ascribed to that term in Section 1-10 of the Illinois Power Agency Act.

"Transportation" means the physical movement of carbon dioxide by pipeline conducted for a person's own use or account or the use or account of another person or persons.

Section 15. Scope. This Act applies only to an owner or operator of a pipeline designed, constructed, and operated to transport and to sequester carbon dioxide produced by a clean coal facility, by a clean coal SNG facility, by a clean coal SNG brownfield facility, or by any other source that will result in the reduction of carbon dioxide emissions from that source. Further, this Act applies only to a person or entity authorized to do business in Illinois who is authorized to transport carbon dioxide by pipeline and has obtained a certificate of authority from the Commission pursuant to this Act.

Section 20. Application.

(a) No person or entity may construct, operate, or repair a carbon dioxide pipeline unless the person or entity possesses a certificate in good standing. No person shall begin or continue construction of a carbon dioxide pipeline unless the person possesses a certificate in good standing.

(b) The Commission, after a hearing, shall grant an application for a certificate authorizing the construction and operation of a carbon dioxide pipeline to the extent that it finds that the application was properly filed; the applicant is fit, willing, and able to construct and operate the pipeline in compliance with this Act and with Commission regulations and orders; and the proposed pipeline is consistent with the public interest, public benefit, and legislative purpose as set forth in this Act. Evidence encompassing any of the factors described in items (1) through (9) of this subsection (b) that is submitted by the applicant, any other party, or the Commission's staff shall also be considered by the Commission.

In its review of an application for a certificate of authority to construct and operate a proposed carbon dioxide pipeline and any alternate locations for that proposed pipeline or facility, the Commission shall consider, but not be limited to, the following:

(1) that the applicant has filed or will timely file with the Pipeline and Hazardous Materials Safety Administration of the U.S. Department of Transportation all forms required by that agency in advance of constructing a carbon dioxide pipeline;

(2) that the applicant has filed or will timely file with the U.S. Army Corps of Engineers all applications for permits required by that agency in advance of constructing a carbon dioxide pipeline;

(3) that the applicant has entered into an agreement with the Illinois Department of Agriculture that governs the mitigation of agricultural impacts associated with the construction of the proposed pipeline;

(4) any evidence regarding the applicant's financial, managerial, legal, and technical qualifications necessary to construct and operate the proposed carbon dioxide pipeline;

(5) any evidence of the effect of the pipeline upon the economy, infrastructure, and public safety presented by local governmental units that will be affected by the proposed pipeline route;

(6) any evidence of the effect of the pipeline upon property values presented by property owners who will be affected by the proposed pipeline or facility, provided that the Commission need not hear evidence as to the actual valuation of property such as that as would be presented to and determined by the courts under the Eminent Domain Act;

(7) any evidence presented by the Department of Commerce and Economic Opportunity regarding the current and future local, State-wide, or regional economic effect, direct or indirect, of the proposed pipeline or facility including, but not limited to, ability of the State to attract economic growth, meet future energy requirements, and ensure compliance with environmental requirements and goals;

(8) any evidence addressing the factors described in items (1) through (9) of this subsection (b) or other relevant factors that is presented by any other State agency, the applicant, a party, or other entity that participates in the proceeding, including evidence presented by the Commission's staff; and

(9) any evidence presented by any State or federal governmental entity as to how the proposed pipeline will affect the security, stability, and reliability of energy.

In its written order, the Commission shall address all of the evidence presented, and if the order is contrary to any of the evidence, the Commission shall state the reasons for its determination with regard to that evidence.

(c) When an applicant files its application with the Commission, it shall provide notice to each local government where the proposed pipeline will be located and include a map of the proposed pipeline route. The applicant shall also publish notice in a newspaper of general circulation in each county where the proposed pipeline is located.

(d) An application filed pursuant to this Section may request either that the Commission review and approve a specific route for a carbon dioxide pipeline, or that the Commission review and approve a project route width that identifies the areas in which the pipeline would be located, with such width ranging from the minimum width required for a pipeline right-of-way up to 500 feet in width. The purpose for allowing the option of review and approval of a project route width is to provide increased flexibility during the construction process to accommodate specific landowner requests, avoid environmentally sensitive areas, or address special environmental permitting requirements.

(e) An applicant under this Act may request the issuance of a certificate of authority from the Commission for the construction and operation of a carbon dioxide pipeline at the same time, and as part of the same application, as its request for a certificate of good standing.

The Commission's rules shall ensure that notice of such a consolidated application is provided within 30 days after filing to the landowners along a proposed project route, or to the potentially affected landowners within a proposed project route width, using the notification procedures set forth in the Commission's rules. If a consolidated application is submitted, then the requests shall be heard on a consolidated basis and a decision on all issues shall be entered within the time frames stated in subsection (f) of this Section. In such a consolidated proceeding, the Commission may consider evidence relating to the same factors identified in items (1) through (9) of subsection (b) of this Section. If the Commission grants approval of a project route width as opposed to a specific project route, then the applicant must, as it finalizes the actual pipeline alignment within the project route width, file its final list of affected landowners with the Commission at least 14 days in advance of beginning construction on any tract within the project route width and also provide the Commission with at least 14 days' notice before filing a complaint for eminent domain in the circuit court with regard to any tract within the project route width.

(f) The Commission shall make its determination on any application filed pursuant to this Section and issue its final order within 6 months after the date that the application is filed unless an extension is granted as provided in this subsection (f). The Commission may extend the 6-month time period for issuing a final order on an application filed pursuant to this Section up to an additional 3 months if it finds, following the filing of initial testimony by the parties to the proceeding, that due to the number of affected landowners and other parties in the proceeding and the complexity of the contested issues before it, additional time is needed to ensure a complete review of the evidence. If an extension is granted, then the schedule for the proceeding shall not be further extended beyond this 3-month period, and the Commission shall issue its final order within the 3-month extension period. The Commission shall also have the power to establish an expedited schedule for making its determination on an application filed pursuant to this Section in less than 6 months if it finds that the public interest requires the setting of such an expedited schedule.

(g) Within 6 months after the Commission's entry of an order approving either a specific route or a project route width under this Section, the owner or operator of the carbon dioxide pipeline that receives that order may file supplemental applications for minor route deviations outside the approved project route width, allowing for additions or changes to the approved route to address environmental concerns encountered during construction or to accommodate landowner requests. Notice of a supplemental application shall be provided to any State agency that appeared in the original proceeding or immediately affected landowner at the time that supplemental application is filed. The route deviations shall be approved by the Commission within 45 days, unless a written objection is filed to the supplemental application within 20 days after the date the supplemental application is filed. Hearings on any such supplemental application shall be limited to the reasonableness of the specific variance proposed, and the issues of public need, public interest and benefit of the project, or fitness of the applicant shall not be reopened in the supplemental proceeding.

(h) The rules of the Commission may include additional options for expediting the issuance of certificates and approvals under this Section. If an applicant elects to use an option provided for in the rules, then the rules may provide that: (1) the applicant must request the use of the expedited process at the time of filing its application; (2) the Commission may engage experts and procure additional administrative resources that are reasonably necessary for implementing the expedited process; and (3) the applicant must bear any additional costs incurred by the Commission as a result of the applicant's use of the expedited process.

(i) A certificate of authority to construct and operate a carbon dioxide pipeline issued by the Commission shall contain and include all of the following:

(1) a grant of authority to construct and operate a carbon dioxide pipeline as requested in the application, subject to the laws of this State;

(2) a grant of authority to use, occupy, and construct facilities in any designated public right-of-way for the construction and operation of the carbon dioxide pipeline subject to the laws of this State; and

(3) a limited grant of authority to take and acquire an easement in any property or interest in property for the construction, maintenance, or operation of a carbon dioxide pipeline in the manner provided for the exercise of the power of eminent domain under the Eminent Domain Act. The limited grant of authority shall be restricted to, and exercised solely for, the purpose of siting, rights-of-way, and easements appurtenant, including construction and maintenance. The applicant shall not exercise this power until it has used reasonable and good faith efforts to acquire the property or easement thereto. The applicant may thereafter use this power when the applicant determines that the easement is necessary to avoid unreasonable delay or economic hardship to the progress of activities carried out pursuant to the certificate of authority.

Section 25. Procedures. Notwithstanding any other provision of this Act, any power granted pursuant to this Act to acquire an easement is subject to, and shall be exercised in accordance with, the Eminent Domain Act.

Section 30. Safety. A carbon dioxide pipeline owner shall construct, maintain, and operate all of its pipelines, related facilities, and equipment in this State in a manner that poses no undue risk to its employees or the public. The Commission shall adopt federal safety regulations governing the construction, maintenance, and operations of carbon dioxide pipelines, related facilities, and equipment to ensure the safety of pipeline employees and the public.

Section 99. Effective date. This Act takes effect upon becoming law.".