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HB431 • 2026

Injection wells; fees assessed on certain wells, notice and participation for local governments provided, study commission established

Injection wells; fees assessed on certain wells, notice and participation for local governments provided, study commission established

Energy Land
Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor
Hammett (M)
Last action
2026-03-31
Official status
Pending Committee Action in Second House
Effective date
Not listed

Plain English Breakdown

The bill status shows it passed the legislature but is pending committee action in the second house; final enactment depends on this step.

Rules and Fees for Carbon Dioxide Storage Wells

This bill sets new rules, fees, and local government involvement requirements for companies that store carbon dioxide underground in Alabama.

What This Bill Does

  • Requires storage operators to make a good faith effort to get consent from all owners of the land rights needed for storing carbon dioxide.
  • Mandates that operators obtain consent from at least two-thirds (66 and two-thirds percent) of the owners of pore space and storage rights before proceeding.
  • Allows the state board to combine, or 'amalgamate,' the rights of non-consenting owners into a project if enough other owners agree, provided those owners are fairly compensated.
  • Requires operators working near specific coal seams in Jefferson, Tuscaloosa, or Walker counties to get written consent from nearby coal mine operators and mineral owners.
  • Mandates that companies give local governments copies of their plans within three business days after submitting them to the state board.
  • Allows local governments to submit comments and speak during public hearings on storage facility petitions with the same rights as the operator.
  • Starts charging fees of seven cents per ton for carbon dioxide stored, split between the State General Fund and the county or municipality where injection occurs, beginning October 1, 2027.
  • Creates a study commission to review how other states handle these fees and report back by early 2027.

Who It Names or Affects

  • Companies that operate facilities for storing carbon dioxide underground.
  • Local governments in counties or cities where storage facilities are proposed.
  • Landowners who hold rights to the space beneath their property (pore space).
  • Coal mine operators and mineral owners in Jefferson, Tuscaloosa, or Walker counties if wells are near specific coal seams.

Terms To Know

Sequestration
The process of capturing and storing carbon dioxide underground so it does not enter the atmosphere.
Pore space
The empty spaces inside rock layers beneath the ground where gases or liquids can be stored.
Amalgamate and pool
To combine separate land rights into one group so a project can move forward even if some owners disagree, as ordered by the state board.

Limits and Unknowns

  • Future fee increases depend on inflation rates (CPI-U) and must be approved through a specific legislative process.
  • The study commission will dissolve after submitting its report to the Legislature in early 2027, but it may recommend new laws.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

XD43F7Z-1

R 1008 • Hammett

Adopted

Plain English: This amendment sets new rules and fees for storing carbon dioxide underground in Alabama, requiring storage sites to be within the state and close to where the gas was created.

  • Operators must get permission from at least two-thirds of landowners before starting a project, though they can force non-consenting owners into the plan if rules are followed.
  • Carbon dioxide cannot be stored in Alabama unless it was generated within the state and no more than 50 miles away from the storage site.
  • New fees will be charged for every ton of carbon dioxide injected, plus large one-time fees to start a facility or close it down safely.
  • The State Oil and Gas Board can raise these fees in the future based on inflation rates.
  • The text does not explain exactly how much money landowners will be paid if they do not agree to the project, only that it must be 'fair.'
  • It is unclear what happens if a coal mine operator refuses consent for projects near their mines.
V71E2LL-1

R 1009

Adopted

Plain English: This amendment requires companies storing carbon dioxide to share their plans with local governments and pay a fee for every ton of gas they inject underground.

  • Companies must send copies of their approval petitions and supporting documents to the local government where the storage facility will be built within three business days.
  • Local governments are allowed to submit written comments on these plans and participate in public hearings just like the company proposing the project.
  • Starting October 1, 2027, companies must pay a fee of seven cents for every ton of carbon dioxide they inject into storage facilities.
  • The money collected from these fees will be split between the state government and the county or city where the injection takes place.
  • The provided text is cut off at the end, so it does not fully explain how future fee increases based on inflation would work if they are approved.
  • While the amendment mentions rules for getting landowner consent and special protections near coal mines, these appear to be existing laws or broader bill details rather than new changes made specifically by this text snippet.
NRYQFTT-1

R 1010 • Hammett

Adopted

Plain English: This amendment creates an exception for certain coastal counties so they do not have to follow the new rules in this bill.

  • Counties that touch both the Gulf of America and another state are excluded from the section being amended.
  • The text does not explain what specific fees or rules apply to other counties, only which ones are exempt.
  • It is unclear why these coastal counties have 'unique' characteristics that require an exception without more context.

Bill History

  1. 2026-03-31 Senate

    Pending Committee Action in Second House

  2. 2026-03-31 Senate

    Read for the first time and referred to the Senate Committee on Finance and Taxation General Fund

  3. 2026-03-19 House

    Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 1011 (Yeas 61, Nays 10)

  4. 2026-03-19 House

    Hammett motion to Table - Adopted Roll Call 1010 (Yeas 63, Nays 29)

  5. 2026-03-19 House

    Motion to Adopt - Adopted Roll Call 1009 (Yeas 84, Nays 0)

  6. 2026-03-19 House

    Hammett motion to Table - Adopted Roll Call 1008 (Yeas 92, Nays 1)

  7. 2026-03-19 House

    Third Reading in House of Origin (Yeas 94, Nays 4)

  8. 2026-03-19 House

    Engrossed

  9. 2026-03-19 House

    Drummond 1st Amendment Offered

  10. 2026-03-19 House

    Hammett 1st Substitute Offered

  11. 2026-03-19 House

    Ways and Means General Fund 1st Substitute Offered

  12. 2026-03-11 House

    Read for the Second Time and placed on the Calendar

  13. 2026-03-11 House

    Reported Out of Committee House of Origin

  14. 2026-03-11 House

    Ways and Means General Fund 1st Substitute

  15. 2026-02-12 House

    Pending Committee Action in House of Origin

  16. 2026-02-12 House

    Read for the first time and referred to the House Committee on Ways and Means General Fund

Official Summary Text

Injection wells; fees assessed on certain wells, notice and participation for local governments provided, study commission established

Current Bill Text

Read the full stored bill text
HB431 ENGROSSED
Page 0
HB431
V71E2LL-2
By Representatives Hammett, Whitt, Reynolds, Hulsey
RFD: Ways and Means General Fund
First Read: 12-Feb-26
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HB431 Engrossed
Page 1
First Read: 12-Feb-26
A BILL
TO BE ENTITLED
AN ACT
Relating to Carbon Dioxide Injection Wells; to
establish the Study Commission on Carbon Dioxide Storage
Facility Fees; to amend Section 9-17-162, Code of Alabama
1975, to require carbon dioxide storage facility operators to
provide notice of filling an approval petition for a facility
with the board to certain local governments; to authorize
local governments to participate in hearings on these
petitions; and to add Section 9-17-167 to the Code of Alabama
1975, to levy certain fees on operators for carbon dioxide
injected into facilities.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 9-17-162, Code of Alabama 1975, is
amended to read as follows:
"§9-17-162
(a) For a storage facility that is used for the storage
and sequestration of carbon dioxide, all of the following
shall apply:
(1) A storage operator shall adhere to all rules
adopted by the board relating to the underground storage of
carbon dioxide.
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HB431 Engrossed
Page 2
carbon dioxide.
(2) A storage operator shall make a good faith effort
to obtain the consent of all persons that own a storage
facility's pore space and storage rights for carbon dioxide.
(3) A storage operator shall obtain the consent of
persons that own not less than 66 and two-thirds percent of a
storage facility's pore space and storage rights for carbon
dioxide.
(4) Upon a storage operator obtaining the consent of
persons that own not less than 66 and two-thirds percent of a
storage facility's pore space and storage rights for carbon
dioxide, the board, after providing notice and a public
hearing, may enter an order to amalgamate and pool the pore
space and storage rights for carbon dioxide owned by
nonconsenting owners into the storage facility on terms that
are just and reasonable as determined by the board.
(5) All nonconsenting owners of a storage facility's
pore space and storage rights for carbon dioxide shall be
fairly and equitably compensated.
(6) A storage operator shall use commercially
reasonable efforts to limit the adverse surface-use impact
upon the lands of nonconsenting owners of a storage facility's
pore space and storage rights.
(7) A storage operator seeking approval to operate in
the Blue Creek or Mary Lee coal seams in Jefferson,
Tuscaloosa, or Walker counties or within a 10-mile radius of
any coal mine operation shall obtain the written consent of
the coal mine operator and mineral owner with an operation or
mineral interest in the seams or within the radius; provided,
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HB431 Engrossed
Page 3
mineral interest in the seams or within the radius; provided,
however, that the consent shall not be unreasonably withheld
or delayed.
(b)(1) In addition to any other notice required by rule
of the board, upon the submission to the board of a petition
to approve a storage facility for the storage and
sequestration of carbon dioxide, a storage operator shall
provide the petition and copies of all technical exhibits and
other data and information submitted to the board supporting
the petition to any local governing body having jurisdiction
over the land of the proposed storage facility not more than
three business days after submitting the petition to the
board.
(2) The board shall hold a hearing on a petition to
approve a storage facility for the storage and sequestration
of carbon dioxide as soon as practicable but not less than 60
days after receiving the petition. The board shall provide to
any local governing body having jurisdiction over the land of
the proposed storage facility notice of the time, date, and
location of the hearing not less than 30 days before the
hearing.
(3) Upon receiving a petition and any information
pursuant to subdivision (1), and prior to any hearing
conducted pursuant to subdivision (2), a local governing body
may submit written comments regarding the petition to the
board and may participate in the hearing to the same extent as
the storage facility operator. "
Section 2. Section 9-17-167 is added to the Code of
Alabama 1975, to read as follows:
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HB431 Engrossed
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Alabama 1975, to read as follows:
§9-17-167
(a) Beginning October 1, 2027, the following fees shall
be levied on each ton of carbon dioxide stored or sequestered
in any storage facility to be collected and disbursed
accordingly by the board:
(1) Seven cents ($0.07) to the State General Fund.
(2) Seven cents ($0.07) to the county in which the
carbon dioxide was injected, or if carbon dioxide was injected
within a municipality, to the county and municipality equally,
to be expended at the discretion of the relevant governing
body.
(b) By the end of each November, the State Oil and Gas
Supervisor may submit to the State Oil and Gas Board a
recommendation of an increase to any fee levied pursuant to
subsection (a) based on the percentage increase in the
Consumer Price Index for All Urban Consumers (CPI-U) (All
Items-U.S. City Average) maintained by the U.S. Department of
Labor, Bureau of Labor Statistics, for the immediately
preceding fiscal year, rounded down to the nearest five cents
($0.05). If the increase is approved by the board, the
supervisor, by the end of March of each year, shall submit the
recommended increase to the Legislative Council for approval.
In the event the recommended increase is not disapproved by
the council by the end of April, the recommendation shall be
deemed approved. In the event one or more years elapse during
which there is no adjustment, the same procedure may be
followed to obtain a net cumulative increase since the
previous increase.
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HB431 Engrossed
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previous increase.
Section 3. (a) The Study Commission on Carbon Dioxide
Storage Facility Fees is established. The commission shall
consist of the following members:
(1) One member of the Alabama House of Representatives,
appointed by the Speaker of the House of Representatives, to
serve as chair.
(2) One member of the Alabama Senate, appointed by the
President Pro Tempore of the Senate, to serve as vice chair.
(3) One member appointed by the Minority Leader of the
House of Representatives.
(4) One member appointed by the Minority Leader of the
Senate.
(5) One member appointed by the Governor.
(6) One member appointed by the Lieutenant Governor.
(7) The State Oil and Gas Supervisor, or his or her
designee.
(8) A representative of the Energy Institute of
Alabama.
(9) A representative of Manufacture Alabama.
(10) A representative of the American Petroleum
Institute.
(11) A representative of the Southeast Oil and Gas
Association.
(b) The appointing authorities shall coordinate their
appointments to ensure the task force membership is inclusive
and reflects the racial, gender, geographic, urban, rural, and
economic diversity of the state.
(c) The first meeting of the study commission shall be
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HB431 Engrossed
Page 6
(c) The first meeting of the study commission shall be
held at the call of the chair no later than August 1, 2026.
The study commission may then meet as necessary to conduct
business.
(d)(1) The study commission shall assess all of the
following matters:
a. The current practices and laws of other states
regarding assessing fees on storage facilities used for carbon
dioxide storage.
b. At what level such fees become barriers to entering
the market and place the state at a competitive disadvantage
compared to other states, while considering the state's unique
geology.
c. At what level fees facilitate the protection and
maintenance of natural resources potentially affected by such
facilities.
(e) The study commission shall prepare and submit a
comprehensive report of its findings, conclusions, and
recommendations for proposed legislation, if any, to the
Legislature not later than the fifteenth legislative day of
the 2027 Regular Session, at which point the commission shall
stand dissolved.
(f)(1) The legislative members of the study commission
shall be entitled to their legislative compensation, per diem,
and travel expenses for each day they attend a meeting of the
task force pursuant to Section 49 of the Constitution of
Alabama of 2022.
(2) The nonlegislative members of the study commission
shall serve without compensation but may be reimbursed for
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HB431 Engrossed
Page 7
shall serve without compensation but may be reimbursed for
necessary expenses in attending meetings of the study
commission pursuant to the policies of their respective
appointing authority.
(g) Pursuant to Section 36-14-17.1, Code of Alabama
1975, the study commission shall provide a notice of all
meetings, the name of each member serving on the study
commission, and a copy of the final report and any other
documents produced by the study commission throughout its
duration to the Secretary of State.
Section 4. Sections 1 and 2 shall become effective on
October 1, 2026. Section 3 shall become effective on June 1,
2026.
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HB431 Engrossed
Page 8
2026.
House of Representatives
Read for the first time and referred
to the House of Representatives
committee on Ways and Means General
Fund
................12-Feb-26
Read for the second time and placed
on the calendar:
0 amendments
................11-Mar-26
Read for the third time and passed
as amended
Yays.........61
Nays.........10
Abstains.....31
................19-Mar-26
John Treadwell
Clerk
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