Full Text of SB2005 102nd General Assembly
SB2005 102ND GENERAL ASSEMBLY |
| | 102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022 SB2005 Introduced 2/26/2021, by Sen. David Koehler SYNOPSIS AS INTRODUCED: |
| New Act | | 30 ILCS 105/5.935 new | |
|
Creates the Carbon Dioxide Geologic Storage Act. Provides that the Act applies to carbon dioxide injections that commence on or after January 1, 2021. Provides that a storage operator may not operate a storage facility without a storage facility permit issued by the Department of Natural Resources. Includes provisions regarding: ownership and conveyance of pore space; ownership requirements; amalgamating property interests; mineral interests; title to carbon dioxide prior to certificate of completion; scope and remedy for claims of subsurface trespass; project completion and title transfer; enhanced recovery projects; Department powers and home rule; and restraint of trade. Limits home rule powers. Creates the Illinois Geologic Sequestration Special Fund. Makes a corresponding change in the State Finance Act.
|
| |
| | FISCAL NOTE ACT MAY APPLY | | HOME RULE NOTE ACT MAY APPLY |
| | A BILL FOR |
|
| | | SB2005 | | LRB102 15992 LNS 21362 b |
|
| 1 | | AN ACT concerning property.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 1. Short title. This Act may be cited as the Carbon | 5 | | Dioxide Geologic Storage Act. | 6 | | Section 5. Statement of policy. It is in the public | 7 | | interest to promote the geologic storage of carbon dioxide. | 8 | | Doing so will help ensure the viability of State industries | 9 | | and will promote economic development in this State. | 10 | | To be practical and effective, geologic storage of carbon | 11 | | dioxide requires cooperative use of surface and subsurface | 12 | | property interests often across large areas. It is therefore | 13 | | in the public interest to employ procedures that promote, in a | 14 | | manner fair to all interests, the use of all pore space in a | 15 | | clearly defined reservoir to ensure comprehensive management | 16 | | of the reservoir and the efficient use of natural resources. | 17 | | It is important that rules governing the use and development | 18 | | of subsurface pore space be consistent with both established | 19 | | precedents and subsurface private property rights.
| 20 | | Section 10. Definitions. As used in this Act:
| 21 | | "Area of review" means the area of review as required to be | 22 | | delineated in the storage operator's federal Underground |
| | | SB2005 | - 2 - | LRB102 15992 LNS 21362 b |
|
| 1 | | Injection Control (UIC) program Class VI permit. | 2 | | "Carbon dioxide injection well" means a well that is used | 3 | | to inject carbon dioxide into a reservoir for geologic | 4 | | storage. | 5 | | "Carbon dioxide plume" means the extent underground, in 3 | 6 | | dimensions, of an injected carbon dioxide stream. | 7 | | "Department" means the Department of Natural Resources.
| 8 | | "Geologic storage" means the underground storage of carbon | 9 | | dioxide in a reservoir.
| 10 | | "Mineral owner" means, as identified in the records of the | 11 | | recorder of deeds for each county containing some portion of | 12 | | the proposed reservoir, any owner of a whole or fractional | 13 | | interest in any or all minerals in real property above, below, | 14 | | or within the proposed reservoir that has been severed from | 15 | | the surface estate by grant, exception, reservation, lease, or | 16 | | other means.
| 17 | | "Pore space" means subsurface cavities or voids that can | 18 | | be used as storage space for carbon dioxide.
| 19 | | "Pore space owner" means the person, trust, corporation, | 20 | | or other entity who has title to the pore space.
| 21 | | "Storage facility" means the subsurface area consisting of | 22 | | the extent of the modeled carbon dioxide plume, as required to | 23 | | be delineated in the storage operator's federal UIC program | 24 | | Class VI permit. | 25 | | "Storage facility permit" means a permit issued by the | 26 | | Department allowing a person to establish and operate a |
| | | SB2005 | - 3 - | LRB102 15992 LNS 21362 b |
|
| 1 | | storage facility. | 2 | | "Storage operator" means a person holding or applying for | 3 | | a storage facility permit under this Act and holding or | 4 | | applying for a UIC permit for the injection of carbon dioxide.
| 5 | | "Surface owner" means, as identified in the records of the | 6 | | recorder of deeds for each county containing any portion of | 7 | | the proposed storage facility, any owner of a whole or | 8 | | undivided fee simple interest or other freehold interest, | 9 | | which may or may not include mineral rights, in the surface | 10 | | above the proposed storage facility, but does not include an | 11 | | owner of a right-of-way, easement, leasehold, or any other | 12 | | lesser estate.
| 13 | | "UIC permit" means an Underground Injection Control permit | 14 | | authorized under the federal Safe Drinking Water Act's | 15 | | Underground Injection Control (UIC) Program that allows a | 16 | | person to operate a carbon dioxide injection well. | 17 | | Section 15. Applicability. This Act applies only to carbon | 18 | | dioxide injections that commence on or after January 1, 2021. | 19 | | Section 20. Storage facility permit.
| 20 | | (a) A storage operator may not operate a storage facility | 21 | | in this State without a valid storage facility permit issued | 22 | | by the Department. A storage facility permit may be | 23 | | transferred or assigned from one storage operator to another. | 24 | | Each permit is valid for 5 years after issuance. |
| | | SB2005 | - 4 - | LRB102 15992 LNS 21362 b |
|
| 1 | | (b) The Department shall issue or renew a storage facility | 2 | | permit if the storage operator has paid the first year's | 3 | | annual fee required by subsection (c) and has met the | 4 | | requirements of Section 30. In addition, the Department shall | 5 | | issue a storage facility permit following the public hearing | 6 | | described in subsection (f) upon its determination that: | 7 | | (1) the storage facility permit is in the public | 8 | | interest; and | 9 | | (2) to the extent the storage facility contains | 10 | | commercially valuable minerals, the interests of the | 11 | | mineral lessee or owner will not be adversely affected or | 12 | | have been addressed in an arrangement between the interest | 13 | | holder and the storage operator. | 14 | | (c) The storage operator shall provide the Department an | 15 | | estimate of the amount of carbon dioxide to be injected into a | 16 | | storage facility for the period of the permit at the time of | 17 | | application for a storage facility permit. On an annual basis, | 18 | | a storage operator shall pay to the Department a fee of $0.08 | 19 | | per ton of carbon dioxide estimated to be injected into a | 20 | | storage facility. Each year the storage operator shall | 21 | | reconcile the past year's payment with the volume of carbon | 22 | | dioxide injected into a storage facility the previous year. | 23 | | The storage operator shall submit payment for the amount | 24 | | injected above the storage operator's estimate for the | 25 | | previous year. If the amount of carbon dioxide injected into a | 26 | | storage facility is less than the amount estimated, the |
| | | SB2005 | - 5 - | LRB102 15992 LNS 21362 b |
|
| 1 | | Department shall refund the storage operator any overpayment. | 2 | | (d) The Department may require a storage operator to make | 3 | | records available to the Department relating to the amount of | 4 | | carbon dioxide injected into a storage facility to ensure | 5 | | compliance with the fee requirements of subsection (c). | 6 | | (e) The fees collected in subsection (c) shall be | 7 | | deposited into the Illinois Geologic Sequestration Special | 8 | | Fund. | 9 | | (f) Prior to issuing a storage facility permit, the | 10 | | Department shall hold a public hearing. At least 30 days prior | 11 | | to the hearing, notice of the hearing shall first be published | 12 | | in the official newspaper of the county or counties where the | 13 | | area of review is proposed to be located and in other print or | 14 | | online publications as required by the Department, consistent | 15 | | with the requirements of the Notice By Publication Act. Notice | 16 | | shall be published daily for 2 consecutive weeks. At least 30 | 17 | | days prior to the hearing, notice of the hearing must be given | 18 | | to: | 19 | | (1) each surface owner of land overlying the storage | 20 | | facility and within one-half mile of the storage | 21 | | facility's boundaries; | 22 | | (2) each mineral lessee or mineral owner with property | 23 | | interests within one-half mile of the storage facility's | 24 | | boundaries; and | 25 | | (3) any pore space owners within the storage facility | 26 | | and within one-half mile of the storage facility's |
| | | SB2005 | - 6 - | LRB102 15992 LNS 21362 b |
|
| 1 | | boundaries. | 2 | | Any objections to the issuance of the storage facility's | 3 | | permit not raised at the public hearing shall be waived. | 4 | | Section 25. Ownership and conveyance of pore space.
| 5 | | (a) For real property that was divided into a surface | 6 | | estate and a mineral estate before the effective date of this | 7 | | Act, nothing in this Section shall alter, amend, diminish, or | 8 | | invalidate rights to the use of pore space that were | 9 | | explicitly acquired by conveyance document. Any such rights to | 10 | | the use of pore space that were not explicitly acquired remain | 11 | | vested in the surface estate. | 12 | | (b) For real property that is divided into a surface | 13 | | estate and a mineral estate on or after the effective date of | 14 | | this Act, rights to the use of pore space shall remain vested | 15 | | in the surface estate unless such rights are explicitly | 16 | | conveyed. | 17 | | (c) Grants of an easement to use or a lease of pore space | 18 | | for geologic storage shall be in perpetuity if so specified, | 19 | | except to the extent the grantee relinquishes the easement or | 20 | | lease because the pore space was not utilized for geologic | 21 | | storage purposes. | 22 | | (d) Any conveyance of rights pertaining to pore space | 23 | | shall not confer any right to enter upon or otherwise use the | 24 | | surface of the land unless the conveyance document expressly | 25 | | so provides. |
| | | SB2005 | - 7 - | LRB102 15992 LNS 21362 b |
|
| 1 | | Section 30. Ownership requirements.
| 2 | | (a) No storage facility permit shall be issued unless the | 3 | | storage operator owns, or has obtained grants of easements or | 4 | | leaseholds for, all of the pore space in a storage facility. | 5 | | (b) If a storage operator owns, or has obtained grants of | 6 | | easement or leaseholds for, more than 50% but less than 100% of | 7 | | the areal extent of pore space within a proposed storage | 8 | | facility, the storage operator may apply to the Department to | 9 | | amalgamate the remaining property interests. | 10 | | Section 35. Amalgamating property interests.
| 11 | | (a) If a storage operator has applied to the Department to | 12 | | amalgamate any remaining property interests in a storage | 13 | | facility, the Department shall: | 14 | | (1) notify any and all nonconsenting property owners | 15 | | who own property interests to be amalgamated; | 16 | | (2) within 120 days, but no less than 60 days after the | 17 | | filing of the application, the Department shall conduct a | 18 | | hearing to determine the fair market value of each | 19 | | property owner's pore space to be amalgamated. The storage | 20 | | operator and each property owner has the right to present | 21 | | evidence as to the value of the pore space, including, but | 22 | | not limited to, the economic benefits to the storage | 23 | | operator, and to be represented by an attorney; and | 24 | | (3) after the hearing, issue an order determining the |
| | | SB2005 | - 8 - | LRB102 15992 LNS 21362 b |
|
| 1 | | fair market value of each nonconsenting owner's pore | 2 | | space. | 3 | | (b) Upon payment by the storage operator to the Department | 4 | | of the total fair market value of the pore space to be | 5 | | amalgamated, the storage operator shall be granted a permanent | 6 | | easement by the Department upon the pore space. The Department | 7 | | shall record the easement with the appropriate county recorder | 8 | | of deeds. The Department shall remit funds received from the | 9 | | storage operator to each property owner consistent with the | 10 | | Department's determination of fair market value. | 11 | | (c) Any easement granted under this Section shall not | 12 | | include the right to use the surface above a nonconsenting | 13 | | property owner's pore space. | 14 | | (d) The Department has the authority to grant a permanent | 15 | | easement to State-owned pore space to a storage facility. | 16 | | Section 40. Mineral interests.
With the written consent of | 17 | | the storage operator, a mineral owner may drill through or | 18 | | near a storage facility to explore for or extract minerals if | 19 | | the drilling, extraction, and related activities are conducted | 20 | | in cooperation with the storage operator and in compliance | 21 | | with: | 22 | | (1) Department requirements that preserve the storage | 23 | | facility's integrity; and | 24 | | (2) all requirements of the storage operator's UIC permit.
|
| | | SB2005 | - 9 - | LRB102 15992 LNS 21362 b |
|
| 1 | | Section 45. Title to carbon dioxide prior to certificate | 2 | | of completion.
Absent conveyance documents to the contrary, | 3 | | the storage operator has title to the carbon dioxide injected | 4 | | into and stored in a storage facility and holds title until the | 5 | | Department issues a certificate of completion. | 6 | | Section 50. Scope and remedy for claims of subsurface | 7 | | trespass. | 8 | | (a) A claim of subsurface trespass shall not be actionable | 9 | | against a storage operator conducting geologic storage in | 10 | | accordance with a valid UIC permit and storage facility permit | 11 | | unless the injection or migration of carbon dioxide materially | 12 | | impairs interests outside the storage facility. | 13 | | (b) A surface or subsurface property interest holder shall | 14 | | be permitted to recover money damages only for loss of a | 15 | | nonspeculative value resulting from the injection and | 16 | | migration of carbon dioxide beyond the storage facility. | 17 | | (c) Punitive damages shall be barred if the storage | 18 | | operator acts in all material respects in compliance with the | 19 | | operational and monitoring requirements of the UIC permit. | 20 | | Section 55. Project completion and title transfer.
| 21 | | (a) After carbon dioxide injections at a storage facility | 22 | | permanently cease, the storage operator may apply for a | 23 | | certificate of completion. Before issuing a certificate of | 24 | | completion, the Department, in consultation with the issuer of |
| | | SB2005 | - 10 - | LRB102 15992 LNS 21362 b |
|
| 1 | | the UIC permit, shall find that:
| 2 | | (1) the storage operator is in full compliance with | 3 | | all laws governing the storage facility, including any | 4 | | ongoing UIC permit requirements;
| 5 | | (2) the storage operator addressed all pending claims, | 6 | | if any, regarding escape, release, leakage, or any similar | 7 | | migration of carbon dioxide outside the storage facility; | 8 | | (3) all carbon dioxide injection wells are plugged, | 9 | | associated equipment and facilities are removed, and | 10 | | reclamation work is completed as required by the UIC | 11 | | permit issuer or the Department; | 12 | | (4) the carbon dioxide in the reservoir is stable, | 13 | | which means that it is essentially stationary or, if it is | 14 | | migrating or may migrate, any migration will be unlikely | 15 | | to be outside of the storage facility, or to the extent | 16 | | beyond the area of review, the plume does not pose a risk | 17 | | of endangerment to underground sources of drinking water, | 18 | | consistent with Class VI permit requirements; and | 19 | | (5) all monitoring wells, equipment, and facilities to | 20 | | be used in the post-closure period are in good condition | 21 | | and retain mechanical integrity. | 22 | | (b) If the Department does not complete the review of a | 23 | | certificate of completion application within 90 days after | 24 | | receipt, including the public notice and input deemed | 25 | | appropriate by the Department, then the certificate of | 26 | | completion shall be deemed issued at the end of the 90-day |
| | | SB2005 | - 11 - | LRB102 15992 LNS 21362 b |
|
| 1 | | period. If the Department does not find that the requirements | 2 | | in subsection (a) are met, then it may decline the application | 3 | | or require amendment to the application before granting the | 4 | | certificate of completion. If the Department requires | 5 | | amendment to the application, then the storage operator shall | 6 | | have 30 days to submit an amended application. Upon receipt of | 7 | | the amended application, the Department shall have 30 days to | 8 | | either grant or decline to grant the certificate of completion | 9 | | or the certificate of completion. The Department's failure to | 10 | | timely issue a certificate of completion or denial of a | 11 | | certificate of completion shall be considered final agency | 12 | | action reviewable in the county court in the jurisdiction in | 13 | | which the storage facility is located. | 14 | | (c) The Department may charge a fee to the storage | 15 | | operator for reviewing the certificate of completion | 16 | | application. The fee shall be in the amount set by Department | 17 | | rule. The amount shall be based on the Department's | 18 | | anticipated expenses that it shall incur in reviewing the | 19 | | certificate of completion application and shall not exceed | 20 | | $10,000.
| 21 | | (d) Once a certificate of completion is issued, the | 22 | | following occurs:
| 23 | | (1) Title to the storage facility and to the stored | 24 | | carbon dioxide transfers, without compensation, to the | 25 | | State.
| 26 | | (2) Title acquired by the State includes all rights |
| | | SB2005 | - 12 - | LRB102 15992 LNS 21362 b |
|
| 1 | | and interests in, and all responsibilities, including | 2 | | regulatory requirements associated with, the stored carbon | 3 | | dioxide, so long as the State and the storage operator may | 4 | | contractually agree that the storage operator shall | 5 | | continue to comply with regulatory requirements associated | 6 | | with the storage facility on the State's behalf. | 7 | | (3) The storage operator and, to the extent the owner | 8 | | is a separate entity from the storage operator, the owner | 9 | | of the geologic storage site, including the owner of any | 10 | | surface and subsurface infrastructure associated with the | 11 | | storage facility, are released from and the State assumes | 12 | | all regulatory requirements and liability associated with | 13 | | the storage facility.
| 14 | | (4) Monitoring and managing the storage facility is | 15 | | the State's responsibility to be overseen by the | 16 | | Department unless and until the federal government assumes | 17 | | responsibility for the long-term monitoring and management | 18 | | of storage facilities.
Upon federal government assumption | 19 | | of responsibility, funds in the Illinois Geologic | 20 | | Sequestration Special Fund shall be transferred to any | 21 | | such parallel fund under federal law for purposes of | 22 | | long-term monitoring and management of storage facilities. | 23 | | To the extent such a fund does not exist, the State shall | 24 | | refund the fees contributed by the storage operators to | 25 | | each party. | 26 | | (5) If the federal government has not assumed |
| | | SB2005 | - 13 - | LRB102 15992 LNS 21362 b |
|
| 1 | | responsibility for the long-term monitoring and management | 2 | | of storage facilities, then the Illinois Geologic | 3 | | Sequestration Special Fund shall be used for the purposes | 4 | | of monitoring and managing the storage facilities and any | 5 | | other responsibility associated with the stored carbon | 6 | | dioxide.
| 7 | | Section 60. Enhanced recovery projects.
This Act does not | 8 | | apply to applications filed with the Department proposing to | 9 | | use carbon dioxide for an enhanced oil or gas recovery | 10 | | project. Such applications shall be processed pursuant the | 11 | | Illinois Oil and Gas Act.
| 12 | | Section 65. Department powers; home rule. The Department | 13 | | may adopt rules and issue orders to enforce this Act. The | 14 | | Department may authorize its employees, qualified by training | 15 | | and experience, to perform the powers and duties set forth in | 16 | | this Act. No agency of State government or political | 17 | | subdivision of the State may regulate geologic storage except | 18 | | as expressly authorized under this Act; so long as nothing in | 19 | | this Section 65 restricts or interferes with the Illinois | 20 | | Environmental Protection Agency's authority to: | 21 | | (1) issue any necessary permits for operation of | 22 | | aboveground facilities associated with the geologic storage | 23 | | project; or | 24 | | (2) issue permits under the UIC program and inspect |
| | | SB2005 | - 14 - | LRB102 15992 LNS 21362 b |
|
| 1 | | geologic storage sites pursuant to Section 13.7 of the | 2 | | Environmental Protection Act. To the extent there is any | 3 | | inconsistency between this Act and Section 13.7 of the | 4 | | Environmental Protection Act, this Act shall control. | 5 | | This Section is a limitation under subsection (i) of | 6 | | Section 6 of Article VII of the Illinois Constitution on the | 7 | | concurrent exercise by home rule units of powers and functions | 8 | | exercised by the State. | 9 | | Section 70. Restraint of trade. None of the rights and | 10 | | responsibilities pursuant to this Act shall be held or | 11 | | construed to violate any of the statutes of this State | 12 | | relating to trusts, monopolies, or contracts and combinations | 13 | | in the restraint of trade.
| 14 | | Section 75. Illinois Geologic Sequestration Special Fund. | 15 | | The Illinois Geologic Sequestration Special Fund is created as | 16 | | a special fund in the State treasury. The Fund shall consist of | 17 | | any money deposited into the Fund as provided in subsection | 18 | | (e) of Section 20. Money in the Fund shall be used for the | 19 | | administration of this Act and for no other purpose. All | 20 | | interest earned on money in the Fund shall be deposited into | 21 | | the Fund. | 22 | | Section 97. Severability. The provisions of this Act are | 23 | | severable under Section 1.31 of the Statute on Statutes. |
| | | SB2005 | - 15 - | LRB102 15992 LNS 21362 b |
|
| 1 | | Section 905. The State Finance Act is amended by adding | 2 | | Section 5.935 as follows: | 3 | | (30 ILCS 105/5.935 new) | 4 | | Sec. 5.935. The Illinois Geologic Sequestration Special | 5 | | Fund. |
|