The New Move to Regulate Methane

Mark Green
Posted January 15, 2015

As we look at the Obama administration’s plan to impose new regulations on methane emissions from oil and natural gas operations, some important points in a couple of charts.

First, when it comes to methane emissions, the White House is focusing on a relatively small piece of the big picture. This chart, based on data from EPA’s Greenhouse Gas Reporting Program, shows that methane emissions from natural gas and petroleum systems (161.6 million metric tons of carbon dioxide equivalent) represent just 28.5 percent of total methane emissions (567.3 million metric tons CO2 equivalent).That’s a fairly small wedge in the overall pie:

Second, overall emissions from energy production and processing, which includes methane, are and have been falling – even as production levels have soared:

As a side note, if we’re talking about just methane emissions from hydraulic fracturing, those emissions have fallen 73 percent since 2011, according to EPA. That’s under existing regulation, including new “green completion” rules that many in industry have been complying with in advance of their full implementation this month.

The larger point is that voluntary industry efforts to reduce methane emissions under existing regulation are working and in the coming years could be more effective and timely than a new government command-and-control regulatory initiative.

So the question: Where’s the compelling case for singling out industry for new methane regulation when industry accounts for less than 30 percent of all methane emissions and when emissions from production and processing are falling and likely will keep falling under existing regulation and industry’s own efforts?

This is the context in which the White House proposes to act – while acknowledging it doesn’t really know how much its proposals will cost. API President and CEO Jack Gerard said the approach could be counterproductive:

“As oil and natural gas production has risen dramatically, methane emissions have fallen thanks to industry leadership and investment in new technologies. And even with that knowledge, the White House has singled out oil and natural gas for regulation, where methane emissions represent only two percent of total greenhouse gas emissions. Emissions will continue to fall as operators innovate and find new ways to capture and deliver more methane to consumers, and existing EPA and state regulations are working. Another layer of burdensome requirements could actually slow down industry progress to reduce methane emissions.”

Kathleen Sgamma of the Western Energy Alliance:

“The President’s plan is another case of the Administration adding new red tape to make mandatory what industry has been doing voluntarily for several years. Natural gas companies have already greatly reduced emissions from the wellhead even as production has soared. In turn, that huge supply of natural gas enables the U.S. to substantially reduce GHGs from its largest source, electricity generation, which vastly outweighs the small emissions from production facilities. By imposing costly regulations on a small source of emissions, the Administration is losing sight of a real climate change solution while continuing to choke out a source of economic growth.”

This new regulatory proposal could pose a significant impediment to America’s shale energy revolution, which is no small matter. Energy from shale has fundamentally changed America’s energy outlook – spurring job creation and economic growth while making our country more secure in the world. Gerard:

“Onerous new regulations could threaten the shale energy revolution, America’s role as a global energy superpower, and the dramatic reductions in CO2 emissions made possible by an abundant and affordable domestic supply of clean-burning natural gas. We need our government to implement sound policies, but this plan seems to be based on politics. We hope EPA will work with industry during the regulatory process to ensure that any regulations are based on science and technology and do not impair the industry’s ability to supply America with energy.”