The EU CCS Directive and guidance documents Dr Raphael Sauter European Commission, DG Climate Action

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1 The EU CCS Directive and guidance documents Dr Raphael Sauter European Commission, DG Climate Action 6 th IEAGHG Risk Assessment Network Workshop 21 June 2011, Pau, France

2 Overview CCS Directive Guidance documents Summary

3 CCS Directive

4 Principles CCS-Directive (2009/31/EC): legal framework for the environmentally safe geological storage of CO2 capture and transport regulated through amendments of existing legislation and at national level removes barriers to CCS in existing legislation Member States determine whether and where CCS will happen on their territory

5 Key elements Key Elements of CCS Directive: site selection and exploration storage permits CO2 stream composition monitoring and reporting closure and post-closure obligations transfer of responsibility financial security and financial contribution emissions captured and stored recognised as not emitted under EU-ETS

6 Transposition Transposition deadline: 25 June 2011 Spain: complete transposition notified to the Commission Large number of Member States: reportedly on track towards meeting the transposition deadline In some Member States: expected delays Reporting questionnaire for first implementation report by Member States adopted and issued on 11 February 2011 Member States to report back by 11 August 2011 First Commission report on implementation of the Directive, based on above reports, to be submitted to European Parliament and Council by 11 May 2012

7 Guidance documents

8 Guidance Documents Four guidance documents were developed over the course of 2010, extensively consulted with Member States and stakeholders, and published on 31 March 2011: CO2 Storage Life Cycle Risk Management Framework Characterisation of the Storage Complex, CO2 Stream Composition, Monitoring and Corrective Measures Criteria for Transfer of Responsibility to the Competent Authority Financial Security (Art. 19) and Financial Mechanism (Art. 20) Support coherent implementation of the CCS Directive across EU Member States

9 Guidance Document 1 CO 2 Storage Life Cycle Risk Management Framework

10 GD1: CO2 Storage Life Cycle Risk Management Framework Life cycle framework for CO2 storage projects Geological context for CO2 storage in Europe Consideration for different geological options for CO2 storage Storage risks (geological and manmade leakage pathways) Risk management Risk identification Risk ranking (significant / insignificant) Risk management measures

11 CO2 storage life-cycle approach to risk management Risk Management during the Main Project Phases and Milestones: Phase 1 Assessment Phase 2 Characterisation Phase 3 Development Phase 4 Operation Phase 5 Post-Closure/ Pre-Transfer Phase 6 Post Transfer! M1 Award of Exploration Permit M2 Award of Storage Permit M3 Start Injection M4 Cease Injection/ Closure Transfer Responsibility to Member State Site Characterisation 3D Modelling Initial Risk Assessment Preliminary As needed Monitoring Initial Plan Baseline Operation Continuing As needed Corrective Measures Initial Plan As needed As needed As needed As needed

12 Guidance Document 2 Characterisation of the Storage Complex, CO2 Stream Composition, Monitoring and Corrective Measures

13 Characterisation of storage complex (Art. 4(2)) Data Collection 3D Static Geological Model Dynamic Modelling Sensitivity Characterisation Risk Assessment Sufficient to construct 3D static geological model for site and complex Characterisation of Storage Site and Complex Assess Dynamic behaviour of site and complex due to CO 2 injection Assess sensitivity of the assessment to changes in assumptions Assessment of safety and Integrity of Site and Complex Geology and geophysics Hydrogeology Reservoir Engineering Geochemistry Geomechanics Seismicity Natural and manmade leakage pathways Field Studies o Surface Studies o Population Distributions o Natural Resources o Interactions with other activities o Proximity to potential sources, supply volumes, and transport networks Geological structure mapping Geomechanical, geochemical, and flow properties of overburden and surrounding formations Fracture system characterisation Areal and vertical extent of complex Pore space volume Baseline fluid distribution Fault and seal integrity Injection rates and CO2 stream properties Coupled processes modelling Reactive processes Reservoir simulator used Short and long term simulations Alter parameters of models to determine sensitivity Hazards characterisation Exposure Assessment Effects assessment Risk characterisation

14 Composition of CO2 stream (Art. 12) Review of CO2 streams from different processes (power generation & industrial processes) Tracers for monitoring CO2 Storage integrity Health & environmental hazards (SOx, NOx, heavy metals) Outline of concerns for key components (H2O, H2, NOx, SOx, amines, etc.) Corrosion impacts, pipeline impacts

15 Monitoring (Art. 13) Overall approach for monitoring and monitoring plan Site characterisation, modelling and risk assessment Plans risk-based and site-specific Integration with EU ETS MRG, comparison of monitoring requirements Close relationships and communication among the CAs Relationships with preventive and corrective measures Survey of monitoring methods and techniques & limitations Scope & format of Monitoring Plans (Baseline surveys) Approval of monitoring plans, updates Data to be retained for the life of the project, after transfer Monitoring options during post-closure pre-transfer

16 Corrective measures (Art. 16) Overall approach Risk based, site specific, linked to monitoring plans Developed together with site and complex characterisation, storage permit, holistic approach along with risk assessment Scope and format of corrective measures plans Outline of corrective measures methods Natural leakage pathways, man made pathways (wells); technology status and limitations of methods Emphasis on early warning & early intervention

17 Transfer of Responsibility (Art. 18) Art. 18(2): Evidence based on Conformity of the actual behaviour of the injected CO2 with the modelled behaviour Absence of any detectable leakage Storage site is evolving towards a situation of longterm stability Minimum Period for Post Closure Monitoring Site Sealing Linkages with Financial Contribution Transfer of Data

18 Guidance Document 4 Financial security (Art. 19) and financial mechanism (Art. 20)

19 Financial Security (Art. 19) Definition of FS and any other equivalent Obligations to be covered by FS Amounts of FS Acceptable Instruments for FS Eligibility criteria for issuers of acceptable FS instruments Establishing and maintaining FS State aid implications

20 Financial Security (Art. 19) Obligations under the permit that must be covered by FS under CCS Directive: Operations Period 1.A monitoring, updates of monitoring plan, and required reports of monitoring results 2.A updates of corrective measures plan, and implementing corrective measures, including measures related to the protection of human health 3.A surrender of allowances for any emissions from the site, including leakages, pursuant to ETS Directive Closure and Post-Closure Period 1.B monitoring, updates of monitoring plan, and required reports of monitoring results 2.B updates of corrective measures plan, and implementing corrective measures, including measures related to the protection of human health 3.B surrender of allowances for any emissions from the site, including leakages, pursuant to ETS Directive 4.A update of provisional post closure plan 4.B sealing the storage site and removing injection facilities 5.A maintaining injection operations by the CA until new storage permit is issued, if storage permit is withdrawn, including CO 2 composition analysis, risk assessment and registration, and required reports of CO 2 streams delivered and injected. 5.B making required financial contribution (FC) available to the CA

21 Financial Security (Art. 19) Amounts of FS: principles discussion for each obligation to be covered adjusting/updating FS amounts Acceptable Instruments for FS: Criteria: Certainty, Amount, Liquidity, Duration, Flexibility, Cost, Administrative Burden Possibility for MS to act as insurer in the absence of commercial insurance subject to State aid implications

22 Financial Mechanism (Art. 20) Definitions Post-transfer obligations Estimation of amounts Availability of FC to the CA Use of the contribution by the CA State aid implications

23 Summary CCS Directive provides a robust legal framework for the geological storage of CO2 Ensure timely conformity checking of transposition legislation and potential follow-up Guidance documents are to support coherent implementation of CCS Directive

24 More information CCS website: Guidance documents: CCS mailbox: Thank you for your attention!