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Climate Change and Carbon Sequestration: Assessing a Liability Regime for the Long-term Storage of Carbon Dioxide

2008
Scholarly Work
Alexandra B. Klass, Elizabeth J. Wilson
Federal Policy/Guidance
State Policy/Guidance
Local Policy/Guidance
Carbon Capture, Utilization and Storage → Carbon Capture and Storage
United States, CCS Liability
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Summary/Abstract

This article surveys the existing environmental law and tort law liability regimes that may cover potential harm from escaping or migrating C02 from CCS activities. It concludes that while existing federal and state environmental and tort liability regimes are insufficient on their own to govern the CCS industry, they can provide important risk management tools and serve as safeguards to private parties and state and local governments in the event of harm. Thus, state and federal legislation specific to CCS should leave in place this basic liability for full-scale commercial CCS projects. The article also proposes an adaptive governance model at the federal level for integrating several different compensation mechanisms-including bonding, insurance, and pooled federal funding–into commercial CCS project management to better provide financial security to investors without destroying existing liability protections for those who may suffer harm from CCS. This proposal offers a starting point for developing a model to integrate and manage liability for the nascent CCS industry.

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