Global CCS Institute - Day 2 - Panel 5 - Defining and Quantifying CCS Risk and Liability

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Sandra Locke - Govt of Alberta

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Global CCS Institute - Day 2 - Panel 5 - Defining and Quantifying CCS Risk and Liability

  1. 1. PANEL 5DEFINING AND QUANTIFYING CCS RISK AND LIABILITYSandra Locke – Government of AlbertaChiara Trabucchi – Industrial EconomicsChris Clarke – University College London
  2. 2. Defining and Quantifying CCS Risk and Liability – an Alberta Perspective October 11, 2012 Sandra Locke, Alberta Energy
  3. 3. CCS Legislation in Alberta• The Carbon Capture and Storage Statutes Amendment Act, 2010 was passed in Dec 2010. – Pore Space Ownership – Long-term liability – Post -closure Stewardship Fund – Tenure Agreements
  4. 4. CCS Regulatory Framework Assessment (RFA)• Review of our existing framework and other jurisdictions• Also looking at some gaps: – Closure criteria. – Methodology and rate for the PCSF. – Role of risk assessment in CCS. – Clarity of roles and responsibilities for Alberta regulators. – How stakeholder engagement will take place. – Role of Environmental Impact Assessments in a CCS project.• Recommendations go to the Alberta Government in late- 2012.
  5. 5. GCCSI Participation in the RFA• The GCCSI was involved at the Steering Committee and Working group level.• Steering Committee – Ian Havercroft• MMV Working Group – Ian Hayhow and Steve Whittaker• Regulatory Working Group – Ian Hayhow
  6. 6. Risk Assessments Are Important• Can be used to reduce and manage risks• Will guide development of monitoring plans• Current status: – Not explicitly required – But, embedded in current ERCB approval processes
  7. 7. RFA Emerging Recommendations – Risk Assessment• Risk assessments should be required as an integral part of MMV and Closure Plans• Guidelines for risk assessments: – Iterative, systematic, technically defensible, transparent and available to the public. – Modelling and simulations to evaluate and predict behaviour and inform the risk assessment. – Identify non-technical risks related to public acceptance of MMV Plans
  8. 8. Post-Closure Stewardship Fund• Established in the Mines and Minerals Act• Allowable uses of the PCSF: • Monitoring of injected CO2 • Fulfilling obligations assumed when closure certificate issued • Suspension, abandonment, remediation and reclamation of orphaned facilities (not capture or pipelines)
  9. 9. RFA Emerging Recommendation – Post-closure Stewardship Fund• PCSF rate should be: • risk-based and probability weighted • project-specific• Third party analysis of projects to help set the rate• Rates should be reviewed when MMV and Closure Plans are reviewed (every three years)• Funds should be pooled amongst all payees
  10. 10. How much money will we need in the future?• Industrial Economics Inc. – Valuation of the long-term risks associated with CCS.• Alberta Innovates Technology Futures – Estimated future costs of potential future MMV and Remediation activities.
  11. 11. Knowledge Sharing• New for most jurisdictions and little publicly available information• We need to share our experiences with each other• Need to leverage external expertise that Governments may not have internally – e.g. risk valuation and management• Communicating risk is key
  12. 12. Thank You Sandra Locke (780) 644-7126 Sandra.Locke@gov.ab.cawww.SolutionsStartHere.ca
  13. 13. Extra Slides
  14. 14. Carbon Sequestration Tenure Regulation• Sets out details of two CCS tenure types• Evaluation Permit • 5 year, non-renewable • MMV plan required• Carbon Sequestration Lease • 15 year, renewable • MMV and Closure plans required – renewed every 3 years• 1000m minimum depth
  15. 15. Carbon Capture and Storage Statutes Amendment Act, 2010 – Mines and Minerals Act• Minister can issue a Closure Certificate• If certificate is issued, liability transfers to Government of Alberta • Owner of injected CO2 • Owner, operator, licensee of injection facilities • Indemnifies the lessee against damages in tort action
  16. 16. RFA Emerging Recommendation – Closure and Transfer of Liability• Minimum closure period – The Crown may grant a closure certificate after lessee has demonstrated sustained compliance with performance criteria, no sooner than 10 years after initiation of final closure plan.• Include climate liability in the list of liabilities that transfers to the Crown after Closure Certificate is issued.

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