AN ACT relating to energy production and byproduct management.

Create new sections of KRS Chapter 353 to establish the purposes of the Act; define terms; require and specify the types of permits before constructing or operating a carbon dioxide facility; exempt enhanced oil or gas recovery under KRS 353.592; require any oil, natural gas or coalbed methane well converted to a carbon dioxide sequestration well to be governed by this Act; set forth the requirements and process to obtain a Class VI underground injection control permit; require permit fees to be put in the carbon dioxide sequestration facility administrative fund; set forth a process for commercially valuable minerals; designate the consent of owners of pore space for a administratively complete application; specify when the Energy and Environment Cabinet can begin technical review of the application; require financial responsibility sufficient to cover specific activities and cabinet review of financial responsibility annually; provide that the cabinet's determination is considered final; allow for the adjustment of financial responsibility based on adjustments in cost estimates; list the type of financial instruments which can be used as qualifying financial responsibility instruments; authorize the cabinet to promulgate administrative regulations for financial responsibility; identify reasons why the cabinet would deny an application for a permit; authorize the cabinet to restore applicant eligibility for permit under specific grounds and circumstances; require cabinet approval for a transfer of a permit and allow obligations and rights to pass to the new transferee; require periodic review of permits; prescribe the notice and comment requirements for a Class VI permit; delineate the cabinet's actions for applications that are complete and incomplete; prohibit the approval or transfer of a permit to an operator for conditions specified and allow eligibility after an applicant, operator, or control person takes certain remedial actions; establish requirements to maintain the integrity of carbon sequestration wells and notification of affected parties when activities occur on the well site; provide mechanism of redress for parties that are not in agreement over activities on the well site; specify the requirements for plugging and abandoning a Class VI well or monitoring well; authorize the secretary of the Energy and Environment Cabinet to enter into cooperative agreements; specify the requirements for a completion certificate issued by the Energy and Environment Cabinet after demonstrating compliance for 50 years or another time frame designated by the cabinet along with notice and public hearing; require ownership transferred to the Commonwealth and that both pore and surface owners are held harmless from liability; establish a carbon dioxide sequestration facility administrative fund and specify the moneys to be placed into the fund and the purposes and uses of the fund; establish an application fee to be paid to the carbon dioxide sequestration facility administrative fund and authorize the cabinet to promulgate administrative regulations for a fee schedule; establish a carbon dioxide sequestration facility trust fund and specify the purposes and use of moneys in the fund; require sequestration operators to pay a fee on each ton of carbon dioxide sequestered and have the fees remitted to the carbon dioxide sequestration facility trust fund; require the cabinet to prepare an annual report on the Class VI underground injection control permit and the carbon dioxide sequestration facility trust fund; state that the report is due December 31 of each year beginning with the receipt of the first application for an underground injection control permit; require the Energy and Environment Cabinet to certify the amount of carbon dioxide sequestered by each permittee and allow amounts sequestered to be used for a carbon dioxide credits, allowances, trading, emissions allocations, or offsets; prohibit the altering of legal rights or relationships of several mineral estates and pore space owners in common law; specify methods for nonconsenting owners; allow for the cabinet to make a determination on missing or nonconsenting pore space owners for a sequestration facility and notice for a pooling order; require the applicant to pay the cost of administrative hearing with a pooling order; establish notice for a pooling order and the compensation of owners; establish requirements for seismic survey of lands; require operator to deposit funds for unknown or missing pore space owners and allow funds to be moved to the carbon dioxide sequestration facility trust fund after 7 years; create a severability clause; establish violations and penalties; require notice and service for violations and establish courts with jurisdiction and a requirement for a stay of notice and administrative hearing; authorize the cabinet to promulgate administrative regulations to develop regulatory program for the administration of the underground injection control program; repeal KRS 353.800, 353.802, 353.804, 353.806, 353.808, 353.810, and 353.812, relating to geologic storage of carbon dioxide.

Status

Passed

Signed or otherwise enacted

Status date

Apr 14, 2026

212 days ago

Current chamber

House of Representatives

Session

2026 Regular Session