California lawmakers ordered state regulators nearly four years ago to create rules for a new climate strategy: permanently storing carbon dioxide underground. According to CalMatters Housing, the law set a January 2025 deadline for the state to establish how companies would guarantee they could pay for cleanup costs and to create a unified permit process across agencies. That deadline has now passed without the rules being adopted.
In May, California Resources Corp., the state's largest oil producer, began injecting carbon dioxide deep underground at Elk Hills, a sprawling oil field in Kern County that has operated for over a century. According to the reporting, this project became the first of its kind in the United States, with federal EPA approval but without California having its own regulatory framework in place. The state cannot currently enforce standards tougher than federal requirements or independently verify that the stored carbon will remain safely underground.
The timing creates real accountability questions. According to CalMatters Housing, three different agencies have partial oversight: California's air board is supposed to write the storage rules, CalGEM regulates the oil and gas wells, and the EPA permits the injection wells under federal drinking-water law. However, it remains unclear which agency would actually be responsible if carbon escaped through one of the field's older wells, which date back to 1910. An attorney quoted in the reporting noted that critical questions about responsibility and cleanup remain unanswered.
The financial stakes are substantial because the project could generate billions in public money from federal tax credits and California funding if it expands as planned. According to CalMatters Housing, the air board cited staffing shortages for missing the regulatory deadline, though some experts argue that drivers and taxpayers deserve clarity about how their money is being spent on experimental technology by major oil companies operating without a completed regulatory framework.
The physical risks also concern advocates. CalMatters Housing reports that a nonprofit analysis identified over 900 oil and gas wells within a mile of the injection site, most of them unplugged or deteriorating, which could potentially provide escape routes for the stored carbon to reach the surface. Federal regulations only require regular integrity tests on the injection wells themselves, not the hundreds of older wells surrounding them, leaving the company largely responsible for monitoring its own work.
What I am seeing locally here in the Bay Area and throughout the East Bay is that these climate solutions are coming faster than our regulatory systems can handle. The Elk Hills project represents something we're going to see more of as California pursues its climate goals, and frankly, buyers and sellers need to understand that climate infrastructure is reshaping land use in ways we're still figuring out. The lack of clear state rules puts communities at risk and creates uncertainty about liability that could ultimately affect property values and environmental costs in affected regions.
