88R5861 JES-F
By: Darby H.B. No. 4557
A BILL TO BE ENTITLED
AN ACT
relating to liability for capturing and storing carbon dioxide.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 4, Civil Practice and Remedies Code, is
amended by adding Chapter 100B to read as follows:
CHAPTER 100B. LIMITED LIABILITY FOR CAPTURING AND STORING CARBON
DIOXIDE
Sec. 100B.001. DEFINITIONS. In this chapter:
(1) "Captured carbon dioxide" means carbon dioxide
from any source that, through human effort or means, is seized for
the purpose of sequestering the carbon dioxide with the intent of
permanently preventing the carbon dioxide from being released into
the atmosphere, including carbon dioxide that is:
(A) captured from the atmosphere;
(B) stripped, segregated, or divided from a fluid
stream; or
(C) captured from an emissions source, including
from:
(i) an advanced clean energy project as
defined by Section 382.003, Health and Safety Code;
(ii) an electric generation facility; or
(iii) an industrial source of emissions.
(2) "Carbon dioxide" means the chemical compound
composed of one carbon and two oxygen atoms. The term includes:
(A) anthropogenic carbon dioxide;
(B) naturally occurring carbon dioxide;
(C) carbon dioxide captured from the atmosphere;
and
(D) phases, mixtures, and combinations of carbon
dioxide that include:
(i) a substance incidentally derived from
the source materials for or process of capturing the carbon
dioxide;
(ii) a substance added to the carbon
dioxide stream to enable or improve storage of the carbon dioxide;
and
(iii) a substance incidentally captured
with carbon dioxide captured from the atmosphere.
(3) "Claimant" means a party seeking relief in an
action described by this chapter. The term includes a plaintiff,
counterclaimant, or cross-claimant.
(4) "Defendant" means a person against whom an action
described by this chapter is brought and who is:
(A) an owner or operator of:
(i) a facility used to store carbon
dioxide; or
(ii) a mechanism or instrumentality used to
transport captured carbon dioxide, including a pipeline or a tank
or vessel carried by motor vehicle, watercraft, or rail; or
(B) a producer of captured carbon dioxide.
(5) "Geologic storage" means the underground storage
of carbon dioxide in a reservoir.
(6) "Geologic storage facility" means the underground
reservoir, underground equipment, injection wells, and surface
buildings and equipment used or to be used for the geologic storage
of carbon dioxide and all surface and subsurface rights and
appurtenances necessary to the operation of a facility for the
geologic storage of carbon dioxide. The term includes any
reasonable and necessary areal buffer and subsurface monitoring
zones, pressure fronts, and other areas as may be necessary for this
state to receive delegation of any federal underground injection
control program relating to the storage of carbon dioxide.
(7) "Legal requirement" means a statute, regulation,
rule, order, judgment, or permit controlling or directing conduct
or the design, construction, or use of a facility or equipment that
was enacted, adopted, promulgated, or issued by the federal
government, an agency of the federal government, a federal court,
this state, an agency or court of this state, or a local government
in this state.
(8) "Reservoir" has the meaning assigned by Section
27.002, Water Code.
(9) "Stored carbon dioxide" means captured carbon
dioxide that is being transported or temporarily or permanently
stored.
Sec. 100B.002. CAPTURED OR STORED CARBON DIOXIDE NOT
NUISANCE. (a) Stored carbon dioxide is not:
(1) a pollutant; or
(2) a nuisance, including a public nuisance, under
common law or the laws of this state, including Chapter 125.
(b) A person may not bring a nuisance action or similar
cause of action on the basis that captured carbon dioxide, stored
carbon dioxide, or a process associated with capturing or storing
carbon dioxide constitutes a nuisance.
Sec. 100B.003. LIMITED LIABILITY FOR INJECTION, MIGRATION,
AND RELEASE OF CAPTURED CARBON DIOXIDE. (a) This section applies
to a civil action for damages for injury to a person or property,
including for interference with a possessory interest or an
ownership right or an injury to crops or an animal, resulting from:
(1) the transmission or injection of captured carbon
dioxide into a geologic storage facility, including an action for
damages caused by seismic activity;
(2) subsurface migration of stored carbon dioxide,
including a claim for trespass or conversion arising from the
subsurface migration of stored carbon dioxide into a pore space,
geologic formation, cavity, void, reservoir, aquifer, mineral
deposit, or other geologic formation; or
(3) captured or stored carbon dioxide being
inadvertently released, including an action alleging environmental
damage caused by the inadvertent release of captured or stored
carbon dioxide into the air or surface water.
(b) A claimant may not recover noneconomic damages in a
civil action described by Subsection (a) unless the claimant
establishes actual damages and one of the following:
(1) that:
(A) the defendant concealed, withheld, or
misrepresented information relevant to a permitting authority's
decision to grant the defendant a permit to:
(i) transport, capture, or store carbon
dioxide; or
(ii) conduct the process or operate the
equipment or facility being used to transport, capture, or store
carbon dioxide;
(B) the information described by Paragraph (A),
as applicable:
(i) relates to the safety or propriety of
injecting carbon dioxide into the geologic storage facility; or
(ii) is relevant to determining whether the
stored carbon dioxide could migrate or escape in the manner in which
it migrated or escaped;
(C) the permitting authority, in granting the
defendant's permit:
(i) reasonably relied on the information
provided by the defendant; and
(ii) did not receive the relevant accurate
information from another source before granting the defendant's
permit;
(D) the information described by Paragraph (A) is
of sufficient importance that a reasonable person with the
permitting authority's knowledge and experience would consider the
information material to the permitting authority's decision to
grant the permit; and
(E) the permit was granted not more than five
years before the date the carbon dioxide was injected, migrated, or
escaped;
(2) that:
(A) at the time of the event that caused the
damage that is the basis of the action, the defendant was not in
compliance with a legal requirement that governs an aspect of the
defendant's conduct, including conduct regarding the defendant's
equipment or facility, relevant to the event;
(B) the legal requirement is intended to protect
a person or property from the kind of damage that occurred in the
event; and
(C) if the defendant had been in compliance with
the legal requirement, the event would not have occurred; or
(3) that, only if the aspect of the defendant's
conduct, including conduct regarding the defendant's equipment or
facility, that is the basis of the action was not subject to a
permitting process described by Subdivision (1) or a legal
requirement described by Subdivision (2):
(A) the defendant's actions or omissions are
contrary to a standard industry practice for the conduct relevant
to the damage-causing event;
(B) the defendant chose not to comply with the
standard industry practice solely for an economic reason; and
(C) if the defendant had acted in accordance with
the standard industry practice, the damage-causing event would not
have occurred.
Sec. 100B.004. LIMITED LIABILITY FOR INTERFERENCE WITH
ACCESS TO UNDERGROUND MINERALS AND WATER DUE TO STORAGE OF CAPTURED
CARBON DIOXIDE. (a) A claimant may not recover noneconomic damages
in a civil action for a claim that a defendant prevented or impeded
access to, or interfered with the production of, underground
minerals or water due to the storage of captured carbon dioxide in a
geologic storage facility unless the claimant establishes, in
addition to other requirements under the law, actual damages and
that:
(1) the defendant withheld from or misrepresented to
the permitting authority information relevant to the authority
determining if storage of captured carbon dioxide in the geologic
storage facility would prevent or impede the claimant's access to
underground minerals or water or interfere with the claimant's
production of the minerals or water;
(2) the permitting authority, in granting the
defendant's permit:
(A) reasonably relied on the information
provided by the defendant described by Subdivision (1); and
(B) did not receive the relevant accurate
information from another source before granting the defendant's
permit;
(3) the claimant did not know or receive notification
of the proceeding in which the defendant obtained a permit to
establish the geologic storage facility; and
(4) the information described by Subdivision (1) is of
sufficient importance that a reasonable person with the permitting
authority's knowledge and experience would consider the
information material to the permitting authority's decision to
grant the permit.
(b) A claimant who receives compensation, including through
a lease payment, a royalty payment, or the purchase of an easement,
in consideration of the possibility that a geologic storage
facility may prevent or impede access to or interfere with the
production of the claimant's underground minerals or water is not
entitled to recover damages from the owner or operator of the
facility if the facility prevents or impedes access to or
interferes with the production of the claimant's minerals or water.
(c) The economic damages available under this section to a
claimant not barred from recovering damages under Subsection (b)
are limited to:
(1) if the defendant's geologic storage facility
prevents or impedes access to the claimant's underground minerals
or water, the increased cost to access the minerals or water that
results from penetrating or circumventing the geologic storage
facility;
(2) if the defendant's geologic storage facility
interferes with the production of the claimant's underground
minerals or water, the:
(A) increased cost to produce the minerals or
water; and
(B) present value of the minerals or water that
the claimant cannot with reasonable probability produce because of
the interference; or
(3) if the defendant's geologic storage facility
prevents access to and the production of the claimant's underground
minerals or water, the present value of the minerals or water that
the claimant cannot with reasonable probability produce because of
the geologic storage facility.
(d) A claimant who recovers in a civil action the damages
described by Subsection (c)(3) from a defendant shall convey the
claimant's ownership interest in the underground minerals or water
that are the subject of the action to the defendant on receipt of
payment of the damages.
Sec. 100B.005. EXEMPLARY DAMAGES. In a civil action to
which Section 100B.003 or 100B.004 applies, a claimant may not
recover exemplary damages unless the claimant:
(1) proves the elements described by Section 100B.003
or 100B.004, as applicable; and
(2) meets the requirements for recovery of exemplary
damages under Chapter 41.
SECTION 2. Sections 382.508(b) and (c), Health and Safety
Code, are amended to read as follows:
(b) On the date the permanent school fund, under Section
382.507, acquires the right, title, and interest in carbon dioxide,
the producer of the carbon dioxide and any person who owned or
operated the carbon dioxide repository before that date are [is]
relieved of liability for any act or omission regarding the carbon
dioxide in the carbon dioxide repository.
(c) Except as otherwise provided by Subsection (b), this
[This] section does not relieve a person who contracts with the
board under Section 382.504(b) of liability for any act or omission
regarding the construction or operation, as applicable, of the
carbon dioxide repository.
SECTION 3. Chapter 100B, Civil Practice and Remedies Code,
as added by this Act, is an exercise of authority under Section
66(c), Article III, Texas Constitution, and takes effect only if
this Act receives a vote of three-fifths of all the members elected
to each house, as provided by Subsection (e) of that section.
SECTION 4. The changes in law made by this Act apply only to
a cause of action that accrues on or after the effective date of
this Act. A cause of action that accrued before the effective date
of this Act is governed by the law as it existed immediately before
the effective date of this Act, and that law is continued in effect
for that purpose.
SECTION 5. This Act takes effect September 1, 2023.