The oil and gas sector is the largest industrial emitter of methane in the country. The Biden administration wants the industry to pay for it.
A rule recently proposed by the Environmental Protection Agency (EPA) would fine oil and gas producers for emitting methane beyond levels set by Congress. The fine is called the Waste Emissions Charge.
“This is novel,” Kathleen Sgamma, president of the oil and gas industry coalition Western Energy Alliance, told The Salt Lake Tribune. “It’s been difficult for the EPA to figure out the thresholds, and it’s very different from how the Clean Air Act has been applied in the past.”
Methane is a powerful greenhouse gas that contributes to global warming and climate change. It also is the largest component of natural gas.
Funding allocated through the Inflation Reduction Act would help oil and gas producers afford and implement updated technology to identify and reduce their emissions, according to the EPA.
The Waste Emissions Charge was also established by the Inflation Reduction Act and applies to oil and gas facilities that emit over 25,000 metric tons of carbon dioxide equivalent annually. In 2024, the charge would begin at $900 per metric ton of excess emissions. In 2025, the charge would increase to $1,200 per metric ton, and in 2026 and afterward, the charge would climb to $1,500 per metric ton.
“Fines for polluting are more than appropriate, especially to achieve the end goal [of reduced emissions],” said Ashley Miller, executive director of air quality advocacy nonprofit Breathe Utah.
“It’s holding these operators accountable,” Miller told The Tribune. “It’s saying, ‘Hey, this is a necessary industry and you can emit out of the nature of your processes, but we are putting our foot down with the excess.’”
This proposed regulation follows another methane rule released by the EPA in December, which targets leaking and flaring at oil and gas facilities. That rule encourages oil and gas producers to implement monitoring technology that can identify leaks and phases out flaring — burning excess methane into carbon dioxide that is released into the atmosphere — at new well sites. The EPA reports that this methane rule will eliminate 58 million tons of methane emissions from the atmosphere between 2024 and 2038.
In response to that rule, Utah oil and gas producers said they were already reducing their emissions voluntarily and that the new regulations would be difficult to implement in the Uinta Basin, a rural area in northeastern Utah where 85% of the state’s oil and gas production takes place.
“In the past, it’s been about leak detection and repair — finding the leak and fixing it so you don’t leak anymore, not trying to quantify it and pay a fee on it,” Sgamma said. “So, not only is it technically difficult to figure it out, but is [the proposed rule] really the best method for the environment?”
According to the International Energy Agency, methane in the Earth’s atmosphere is responsible for a third of the recent increase in global temperature.
Follow @HUFH4M