Brief

EPA to reconsider methane rule for new oil, gas facilities

Dive Brief:

  • The U.S. Environmental Protection Agency announced yesterday it would reconsider limits on methane emissions from oil and gas drilling sites, indicating it would hit pause on a June 3 compliance date and take public comment on possible changes.
  • While the agency said last year that the rule would help eliminate the equivalent of 11 million metric tons of carbon dioxide emissions, fossil fuel producers argued it was duplicative, unnecessary and would stifle growth.
  • The Trump Administration continues to work on rolling back Obama-era energy and environmental rules. The White House has also targeted toxic discharge from coal plant rules, the Clean Power Plan and clean water rules.

Dive Insight:

In the wake of Trump's November election, there was much speculation about how far the new administration would go in rolling back Obama-era regulations. The answer appears to be "all the way." While the administration has targeted the Clean Power Plan and myriad other rules and policies, the methane regulations were expected to stand (though not be expanded to existing rigs).

The Washington Post reported the methane rules for new drilling sites "might be the hardest to reverse," back in November, but indications from the EPA this week are that Trump will try to do just that.

“EPA is continuing to follow through with President Trump’s Energy Independence Executive Order,” agency Administrator Scott Pruitt said in a statement. “American businesses should have the opportunity to review new requirements, assess economic impacts and report back, before those new requirements are finalized.”

The EPA has sent a letter to the groups opposing the rule, including the American Petroleum Institute, informing them that remaining obligations under the rule will be administratively stayed upon reconsideration. A 90-day delay of the rules, which were set to go into effect in early June, will allow time for comment. Possible changes would exempt low-production wells from the restrictions.

The 2016 rules were part of former President Obama's efforts to cut methane emissions 40-45% from 2012 levels by 2025. EPA estimated the rules will reduce methane emissions by 510,000 short tons in 2025, the equivalent of reducing 11 million metric tons of carbon dioxide. The agency estimated the pricetag for compliance costs will range $420 million to about $530 million in 2025, but also said the rule would yield climate benefits of $690 million, resulting in a $160 million net benefit.

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Filed Under: Generation
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