The Limits of Liability in Promoting Safe Geologic Sequestration of CO2

25 Pages Posted: 21 Mar 2011

See all articles by David E. Adelman

David E. Adelman

University of Texas School of Law; University of Texas at Austin - Kay Bailey Hutchison Center for Energy, Law & Business

Ian J. Duncan

Bureau of Economic Geology, Jackson School of Geosciences, The University of Texas at Austin

Date Written: March 16, 2011

Abstract

Deployment of new technologies is vital to climate change policy but invariably poses difficult tradeoffs. Carbon capture and storage (CCS), which involves the capture and permanent burial of CO2 emissions, exemplifies this truth. CCS lacks the green appeal of renewable sources of power, and disbelief is an all too common response of laypeople when told that billions of tons of CO2 can be stored underground for centuries. Yet its low (relative) cost and enormous capacity to mitigate CO2 emissions have attracted a broad range of prominent stakeholders, who assert that avoiding climate change will be impossible without CCS.

The legal debate over CCS mirrors these fault lines. The issues of greatest concern have centered on the risks of CO2 leakage and the merits of long-term liability. These fears reflect misapprehensions about the nature of the risks involved and a neglect of operational factors that simplify application of tort liability. Put in perspective, we show that the risks are remarkably small given the huge volumes of CO2 involved. We conclude that common law liability is likely to play a modest role in promoting safe geologic sequestration of CO2. The combination of risks with different temporal profiles will limit the deterrence value of liability, and long-term liability in particular will have only a nominal effect. The Article closes by proposing a hybrid legal framework that combines a traditional regulatory regime with a novel two-tiered system of liability that is calibrated to objective site characteristics.

Keywords: Climate Change, Carbon Sequestration, Carbon Offsets, Liability Regimes

JEL Classification: K32, K13, K20

Suggested Citation

Adelman, David E. and Adelman, David E. and Duncan, Ian J., The Limits of Liability in Promoting Safe Geologic Sequestration of CO2 (March 16, 2011). Duke Environmental Law & Policy Forum, Vol. 22, No. 1, Fall 2011, Energy Center Research Paper Series No. 12-02, Available at SSRN: https://ssrn.com/abstract=1788350 or http://dx.doi.org/10.2139/ssrn.1788350

David E. Adelman (Contact Author)

University of Texas School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States
512-232-0877 (Phone)

University of Texas at Austin - Kay Bailey Hutchison Center for Energy, Law & Business ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States

Ian J. Duncan

Bureau of Economic Geology, Jackson School of Geosciences, The University of Texas at Austin ( email )

2317 Speedway
Austin, TX Texas 78712
United States

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