Carbon Sequestration, Inc. v. Texas Commission on Environmental Quality

A company that operates a facility where waste wood materials are buried in a way that generates a carbon removal credit filed a lawsuit against the Texas Commission on Environmental Quality (TCEQ) seeking a declaration that would permit the facility to operate as a municipal solid waste recycling facility. The company said the physical product created underground was “validated by a carbon credit under the Puro.earth 100-year Terrestrial Storage of Biomass Methodology.” The company alleged that TCEQ initially approved the company’s notice of intent to operate the recycling facility but subsequently stated that the facility was in violation of Texas regulations because “the production of [Carbon Oxide Removal Credits (CORCs)] is not simultaneous with the production of a physical product that can be repurposed for later use.” The company contended that it satisfies regulatory requirements because it “recycles raw waste biomass into a physical material for beneficial use through separation, cleaning, and preparation processes” and that “[t]he processed and buried wood becomes a physical product certified as a CORC, providing verifiable carbon removals showing the carbon is underground, not in the atmosphere.” The company further alleged that it “promotes the development of markets for recycled biomass by offering a reliable source of CORCs, which are becoming increasingly significant in the global fight against climate change.” In addition to declaratory relief, the company requested at least $250,000 for detrimental reliance, attorney’s fees and costs, and temporary injunctive relief.