Houston (Platts)--5Mar2008

A managing director of a top environmental group called Tuesday for a new
"regulatory and legal structure" that would guide the development of
underground CO2 storage in the US.

Environmental Defense's Mark Brownstein said that a "regulatory driver"
will help the power industry "get off the dime" and begin thinking seriously
about how not only to capture CO2 emissions mainly from coal-fired power
plants, but also how and where to store the emissions.

He said a legal structure needs to be put in place that will determine
sub-surface sequestration rights, who actually will own the stored CO2 and how
the underground storage in saline aquifers should be monitored and verified.

Brownstein, speaking at a Texas power markets conference that Platts
hosted in Houston, said that the industry today has a "chicken-and-egg
problem" and "tends to believe" it has to wait for carbon capture technology
before it can begin reducing CO2 emissions.

He argued that, while "coal will be with us far into the future," the US
nonetheless needs national legislation that "leads to a price of carbon."
Brownsfield said energy-efficiency programs and renewable energy facilities
are the "bridge to a low-carbon future."

Brownstein, who is Environmental Defense's managing director of business
partnerships, said, however, that climate change concerns demand that
something be done with CO2 emissions. He argued that there is "a role to be
played" by financial incentives to spur carbon capture and storage
technologies.

Brownstein said that "bonus allowance provisions" within a cap-and-trade
system, or a percentage of allowances allocated through public auction, could
go toward funding CCS. He also said that establishing a Climate Change Credit
Corporation should be considered.

--Jeffrey Ryser, jeffrey_ryser@platts.com