Agriculture, Forestry & Economic Development - Senate

For sure you can McGill committee to order. Would you step up the disinterment gaveled in. You should be a thirty left. We've got to bills only a. The agenda today. Under. You are. You would please the. Thank you senator Ervin District twenty four. You're recognized all right we're talking with Senate bill two O. nine yes. Okay Senate bill two O. nine and this is the Arkansas department of energy and environment working with the liquefied petroleum gas board and what this bill would do it grants the board the authority to suspend inspection and registration fees on a year by year basis and the current language mandates that if the board suspends the species in the suspension of the fees has to remain in place until the fund balance is below five hundred thousand dollars and then this proposal gives that board a little bit more flexibility and that there is we don't think that there's any controversy with this and that we have we have found this is a bill that's been supported by the industry there are folks here that can speak from the board as well and they can come to the table if you have questions about the bill. You wanna have questions up. To be the one your definition is somewhat confusing so I'm if you end up on of June six one year and and September seventeenth next year uses spending from year from that calendar date or you won't suspended for the entire next calendar year the Mister foster can come up if you don't mind please. The you would turn your microphone introduce yourself record Kevin foster the director the up against port. the the thinking was that we would put this into effect with the fiscal year and so it would start July one and then it would roll back around and it would just be discussed on a fiscal year basis it. Anyone have questions on an. Love. Okay so. Tell me again what you're what you're trying to accomplish because what what I mean because what it's saying is that you're going I mean you're striking through the language. And there is no new language so tell me exactly what you're trying to accomplish okay went when this statute was was written they put the five hundred thousand dollar balance in there and for the last for the last little bit the board has been discussing ways that we can reduce the burden on the industry this was in our statute already a bond advice from counsel because this was so old they recommended that we make this adjustment to allow if the balance dropped difficult the way that is written now if they invoke this if the board chooses to invoke this then it will remain in place until the balance does drop below five hundred thousand when this was written that was would be fine but to be fiscally responsible the board felt like if this was removed then they could address it year by year and so that balance would not necessarily have to get below five hundred thousand. So and then currently the fund balance to your question Senator love the fund balances above five hundred thousand dollars and adequate to maintain their operations which is why they want the flexibility and waiving fees would result in a net production of approximately three hundred twenty thousand dollars per year at the current time so they want the flexibility to actually waive those fees but if it falls below five hundred thousand. Right then the old language if if if we waited to do that that would fall below of the yearly appropriation to maintain the the agency because over the years you know everything is got more expensive whatever so. This would give them the ability to. Year after year just continue to roll that over Intel such time that they thought okay we probably need to go ahead and and put this back in place for a period of time it's just a way to be more fiscally responsible okay then the way that the the statute was a originally written all right thank you. Get more. So basically just to summarize you have more money in the account and you need and you're looking to reduce some fees on the industry to spend down that money and then as you need more you look at the flexibility of putting us back in place that's correct yes Sir thank you. Kind of like what we do in our normal activities looking at year by year I think it's important real confused of state government trying to reduce the fees and taxes will be my second bill number and on reducing video question. No one signed up to speak for against the. Motion to it is for our promotion second. Of all in favor say aye All opposed congratulations bills passed okay Senator one on the Senate bill two ten and again just a really appreciate those folks that serve on those boards they do a lot of great work across the state thank you Mr falls everybody okay and if I can just bring the folks to the table that can help me with this bill that would be great. Okay. Again senator when few would introduce yourself for the record Senator Missy Irvin district twenty four. Bill two ten. Yes Senate bill two ten. So this is this is one that I know I've had constituents of mine reach out to me and grateful for this legislation and working with the department of energy and environment and the oil and gas commission so if you look at the what this would do is grants the only gas commissions statutory authority to adopt rules regulating the underground storage of hydrogen and carbon dioxide and other gases you'll see that language has it is changing that definition of gas and including more than just natural gas I think and throughout the bill and so that the commission would also have the opportunity then to adopt class six rules and seek privacy for the carbon capture utilization and storage and this helps and I'm gonna say halo effects which is Hutchinson correct okay just making sure I get this correct by granting the commission authority to regulate the underground storage of hydrogen and and so I think this is just an an adaptation to the realities that we're seeing in this industry and Arcobello these of being able to maintain that the demands of what were seen with all types of different gases beyond just natural gas I mean that's that's generally giving the commission that flexibility and the ability to do rule making authority through the department of energy and environment is really I think the impetus for this legislation an alternative to the current Marconi introduce yourself for the record you're recognized thank you saying Corey secretary for the Arkansas department of energy and environment in my prior role as chief counsel for the department of environment and then what the only gas commission for sixteen hear something along those lines so basically center eleven exactly right right now the natural gas storage laws in Arkansas give that will gas commission authority to authorize and regulate. The storage of natural gas we have to natural gas storage fields in Arkansas currently that are regulated by the commission the purpose of this bill we worked with industry we work with others and it is simply to give the commission the authority to order section over the storage of other gases the two that were specifically focused on at this point time our CO two four for carbon capture sequestration purposes and we have some companies think they're even it in the room here that have made application EPA right now that's a class six well you have to go to eat PA in order for us to seek delegation or primacy of that program as the state we have to have the authority to regulate that storage of this bill does that against on gas commission authority over over storage of CO two which then we would start probably the two or three year process of seeking delegation from the EPA for for those types for CO two it also would with our hydrogen hope with Arkansas Oklahoma Louisiana hydrogen is a potential gas that could be stored it is stored in other states and other working on storage projects Louisiana if we have the the right course basics entering the opportunity in the need this would also allow the commission to have that that forty or jurisdiction over storing hydrogen as well. Thirties. Thank you Shane Hey when I when I read this is it obvious the focus is taken off natural and expanding the ability does that change anything from a but a way of of safety on the way that these different gases because they react differently to different environments and so what's the what's the insurances that we feel better that now were allowing other types of of gases in under Act underground environments that we feel good about moving this direction well it the commission still gonna have to promulgate rules for that process so that process would be a public comment period obviously led governor's approval and legislative approval Beyond that process are thinking was that as opposed to limiting it just to the two were focused on now as technology advances would have to come back in amend the statute every time there was another gas that could be stored but we can go through the rulemaking in the approval process before the legislature. So I guess the answer is we are trying to be expansive so that we didn't have to amend the law every time a new gas came to play but we would have to go through the rule making process to adequately address safety concerns public health so if I hear you right this is the first step of allowing that And then there still review process to make sure that each of these gases are are we would probably get a rule for each or amend a rule for new ones as they they came in and we do have rulemaking approval and. Due to the constitutional amendment that passed thank you. Gilmore. Well I think the point which is made this is just the first step correct of you said that so one of the things I think this could be very beneficial and correct me if I'm wrong but business is coming to the state they're looking to reduce their carbon footprint this would allow them to do that this would allow them to potentially sequester carbon or other gases and this is just the first step in that process correct yes I'm gonna is this yes and so I mean I know I'm I'm jealous aileron Act committee and I'm not and the technology advancements around this industry I mean it's just unbelievable and and we are attracting them in the State of Arkansas is attracting companies from all over the world literally engaging with us because I know that were friendly to them and working with them to utilize that technology but eight these literally if some of these companies that that are coming and and and that want to work with Arkansas come that's a huge game changer for a lot of rule Arkansas I'm out in Van Buren county with a company that is doing just incredible things in the shipping industry actually with their recycling and re use of of water and that water that has been used and and fracking situations and things like that it's unbelievable and they could be game changers literally for role Arkansas if these companies locate and and work with us circle of. Thank you Mr. On page four. Of the petition for the eminent domain can you walk me through this section because is it shall in seems like we're expanding it from. Just the gas and public utility to also the gas storage facility so he Walker QFE through that sure and I may have Director Bingle who is the director shall gas commission and also our chief administrative for energy he can probably give a more thorough explanation but in essence the way it works is right now if you're going to do a large project for CO two sequestration storage you'll have to go out and acquire in this bill does not address who owns that that's that's something else that the state will have to deal with assuming we go further down this road but in order to have a large term storage facility for CO two or nitrogen eccentric you're gonna have to acquire the rights under that. Service right the the well the the poor space underneath the surface rights to adequately address storage of whatever gas you gonna put in there so right now for example if you were to have a natural gas storage facility this would also apply so that if you're injecting CO two in an area that CO two the gas is obviously going to migrate a certain radius and just like an oil and gas not everybody may want to voluntarily participate in that process of this creates a process where they can be adequately compensated as determined by a judge for whatever poor space maybe you utilized in that process so it can works for natural gas now for either pipelines or natural gas storage this would create a similar process are actually the same process in an area where you're gonna have a large storage of CO two where maybe you've got ninety eight percent of the people to give you that right but you still have a few people in the middle of that area without their consent in some form or fashion that you couldn't legally do this creates a legal mechanism for them to be compensated the judge determine the right compensation so that you can before the project and that's the extent of my knowledge on some and turned over to director bingo that's exactly correct. You would please introduce yourself reporting on the the chief minister for community programs any also director of the on gas commission you're recognized to answer the question no that explanation was proper the eminent domain would only be used however if the company did not acquire all the rates in the area that they were going to inject into. So if there was a. Ten or fifteen thousand acre of storage unit for CO two and if they acquired all those rates from the men from the landowners and eminent domain would not be used as a secretary Currie said It if there were ten fifteen twenty acres in that large unit of that were prohibiting thank you for being used for storage there's remnant to me would be used in a court with a determine what's proper compensation was or the project would continue. Love you all. So. In the storage. What there any residual effect all of the above ground. There is also damage or whatever I mean like say for instance I have that twenty eight. And I'm yes I'm a farmer or whoever. is there any damage done to the to the to the surface. No it's all done subsurface and I might. Say we already have storage rules for natural gas in adopted in our in our in the commission The storage of CO two for example is regulated by U. S. EPA they have an X. exhaustive program and that we would adopt a look today exactly that you have to maintain the guessing and then the rest of our there can be no movement outside the reserve or there can be no movement vertically also so those rent regulation or existing federal law we would just simply stop those all right thank you. They're still what would. What would be the depth that this gas distorted and grow in the ground it depends on the zone but for CO two for example one of the primary targets is to Smackover limestone south Arkansas it's but eight thousand seventy thousand nine thousand feet. So there shouldn't be any chance at all of anything coming to number that would be really if that did happen is they'll try to fuel down we we do not permit a well if there's any chance of that kind of movement vertically thank you. To anyone else. No one signed up to speak for against Senator Irvin like close review. yes thank you Terry Michael circle you have sorry thank you at yes thank you members of the committee I appreciate the questions really appreciate the questions engagements and I share your concerns about eminent domain I think we all do but it's a legal process that I think we have to allow to allow in in seconds are certain circumstances especially in these types of areas that we're discussing but I just wanna say I appreciate this coming from my perspective of what we deal with in the natural gas world's and in my area of my districts down that's been greatly impacted by this but in a very very positive way in and and we have to make sure that we ensure to do that in a safe way so that we are not creating an unnecessary environmental impact that we don't want Arkansas the natural state for a very good reason so I trust these folks and I appreciate their expertise and digging in on this and and I share the same concerns and and just appreciate your your level of questions so with that I appreciate a good vote. Bills to pay second. The circle of. The all in favor say aye All opposed. Congratulations bill passed with no other business before the committee we stand adjourned.