As Americans prepare to drive home during one of the biggest travel weekends of the year, it’s a reminder of how energy policy has drastically changed over the past 30 months. In the Trump administration’s latest move, the U.S. Environmental Protection Agency (EPA) has rolled back more “redundant” regulations, including rescinding limits on methane emissions.
“EPA’s proposal delivers on President Trump’s executive order and removes unnecessary and duplicative regulatory burdens from the oil and gas industry,” said EPA Administrator Andrew Wheeler in a public statement. “The Trump Administration recognizes that methane is valuable, and the industry has an incentive to minimize leaks and maximize its use.”
The oil and gas industry has long maintained it is doing what it can to minimize methane emissions, which by most accounts are believed to be 80 times more potent than carbon dioxide. Methane leaks are a pesky challenge across the entire natural gas industry’s value chain, but at the same time they have inspired innovation as established energy companies and startups alike try to prevent methane gas from emitting into the planet’s atmosphere.
Curiously enough, several energy companies are pushing back against the Trump administration’s decision, arguing such regulations governing methane are a net positive.
“The best way to help further reduce and ultimately eliminate methane emissions industrywide is through direct federal regulation of new and existing sources,” said Susan Dio, BP America’s chair and president, in a Houston Chronicle op-ed. “From an efficiency standpoint, a single set of regulations created by the Environmental Protection Agency would be preferable to a patchwork of regulations created by multiple federal or state agencies.”
As Bloomberg’s editorial board noted:
“ . . . the rules introduced under President Barack Obama were hardly onerous. They required oil and gas companies to take action to prevent methane leaks from new wells, pipelines and storage tanks. Methane, unlike carbon dioxide, is a fuel, so companies have reason to do this anyway. And existing wells, which outnumber new ones, would have plenty of time to adapt: The EPA would have taken years to develop new standards for them.”
Plenty of stakeholders in the energy sector are shaking their heads, too. “[The ruling] is another dangerous, ill-advised maneuver that aims to sabotage climate action while flying in the face of investor concerns,” the sustainability advocacy organization Ceres said in a public statement. “Methane is a valuable product for oil and gas companies and their investors, who see methane leaks as a waste of assets.”
The EPA’s own data suggests the rollback of these regulations governing methane could release an additional 370,000 tons of additional methane emissions between now and the mid-2020s – or the equivalent of 9 million more cars driving America’s roads, according to Forbes.
Investors are beginning to respond as well, as a group of 140 investors backed by $5.5 trillion in assets under management have urged 35 companies across the oil and gas sector to oppose the EPA’s rule changes. The letter’s authors have asked energy companies to go a step further and make it clear that they support federal regulations of methane emissions.
The bottom line is that as renewables continue to surge while more consumers are aware of the natural gas industry’s environmental impact, energy companies don’t need more news that casts them in yet even more negative light. After all, the EPA regulations that had governed methane emissions served the public interest. It may be true the current White House occupants are the oil and gas industry’s friends; nevertheless, the fossil fuels-friendly EPA gave the energy companies a gift they don’t necessary want or need.
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