EPA Underestimated Methane From Oil and Gas

By Nushin Huq and Andrew Childers

Feb. 24 — The Environmental Protection Agency has been “substantially” underestimating emissions of methane from the oil and natural gas sector, and that could drive new agency regulations going forward, Administrator Gina McCarthy said Feb. 24 in Houston.

The EPA's most recent draft greenhouse gases inventory, released Feb. 22, revealed substantially higher levels of methane emissions from all parts of the energy sector, from storage to pipelines, McCarthy said during IHS' CERAWeek conference.

“So be on the lookout for more on this to come soon because this is something we’re not going to ignore,” McCarthy said.

However, McCarthy stopped short of saying whether the EPA would propose methane standards for existing oil and gas operations, something environmental advocates have pressed the agency to do.

More Potent Than Carbon Dioxide

The U.S. emitted 636.3 million metric tons of carbon dioxide equivalent of methane in 2013, according to the draft inventory.

Methane is a short-lived pollutant that is 25 times more potent a greenhouse gas than carbon dioxide on a 100-year scale, according to the EPA, and it accounted for 9.5 percent of all U.S. greenhouse gas emissions in 2013.

New information on methane emissions based on data from a variety of sources such as government agencies, industry and academic researchers presents a more accurate picture of U.S. emissions, which may spur the EPA to take additional steps to regulate the pollutant, McCarthy said.

“So the bottom line is—the data confirm that we can and must do more on methane,” she said. “It has always been EPA’s job to follow where the science and data lead us. So that’s exactly what we plan to do moving forward.”

EPA Improves Measurements

The EPA in its most recent inventory increased its estimates of methane emissions from past years based on its updated data. So now the EPA inventory reflects that the U.S. emitted 647.6 million metric tons of carbon dioxide equivalents of methane in 2012, rather than 567.3 million metric tons as previously reported, a 14 percent increase.

The updates come after the Environmental Defense Fund, Colorado State University and others issued a series of reports on the oil and gas sector that found emissions were significantly higher than previously thought .

In the latest draft greenhouse gas inventory, the EPA acknowledged the work researchers have done to improve data collection on methane.

“EPA has engaged with researchers on how remote sensing, ambient measurement, and inverse modeling techniques for greenhouse gas emissions could assist in improving the understanding of inventory estimates,” the draft inventory said.

Despite the revisions, the oil and gas industry said no new regulations will be needed.

“If you look at the trajectory for greenhouse gas emissions, they’ve been going down now for some time,” Jack Gerard, president of American Petroleum Institute, told Bloomberg BNA Feb. 24. “So we ask, why are you regulating something we are managing? If the trajectory of those emissions is continuing to diminish, why would you spend all the time to potentially freeze technology in place and add more cost to delay to industry. Let the marketplace advance and continue to improve.”

EPA Readying Rules

The EPA has taken steps toward directly regulating methane emissions for the first time, proposing standards for new oil and gas systems (RIN 2060-AS30) as well as for new and existing landfills (RIN 2060-AM08 and RIN 2060-AS23). The final rules are expected this summer.

Oil and gas wells and landfills are among the largest source of anthropogenic methane emissions in the U.S., trailing only enteric fermentation from cattle, according to the EPA's inventory.

“The proposed standards present a commonsense way to make sure that as the natural gas industry continues to grow, we're doing what we can to reduce methane pollution,” McCarthy said. “And the proposed standards are cost-effective by design. They're built to reduce pollution that's fueling climate change while supporting responsible energy development at the same time.”

McCarthy told reporters after her speech that the most recent methane data show emissions from sources the EPA was not even aware of previously, such as emissions from cleaning pipelines. She added that the number of storage tanks is much higher than previously estimated.

“There are pneumatics we didn't even knew existed,” McCarthy said.

The EPA in 2012 had declined to directly regulate methane emissions from the oil and natural gas sector in performance standards for the industry. Instead, the EPA said emission limits for volatile organic compounds would produce significant reductions in methane as well.

While environmental groups have praised the EPA for proposing methane standards for new and modified oil and gas wells, they also pressed the agency to do more and regulate existing wells, the largest source of emissions for the sector.

“We’re at the point now where nothing should stop us from moving forward with a regulatory proposal. We have the data,” Matt Watson, associate vice president for the Environmental Defense Fund's Climate and Energy Program, told Bloomberg BNA Feb. 24.

Conrad Schneider, advocacy director for the Clean Air Task Force, said the EPA should be able to propose standards for existing oil and gas wells in the time the Obama administration has remaining.

“We think the record in the proposal they have on new sources, modified sources provides all the information they actually need. They just need to extend those to existing sources,” he told Bloomberg BNA Feb. 24.

Voluntary Reductions Sought

Voluntary cooperation on emission reductions has not been productive with the oil and gas industry compared to other industries, such as utilities and mining. The EPA in July 2015 issued its “methane challenge” to oil and natural gas companies, encouraging them to take voluntary measures to curb emissions of the pollutant. The challenge asks companies to set methane reduction targets that would be reported to the EPA through the annual greenhouse gas reporting requirements .

As a new regulator of the oil and gas industry, the EPA is still learning about the sector, McCarthy said.

“There's a lot of players,” McCarthy told reporters. “They are very diverse.”

To contact the reporters on this story: Nushin Huq in Houston at nhuq@bna.com and Andrew Childers in Washington at achilders@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com