EPA Methane Rule Will Cost Americans and Benefit OPEC

• Consumers will face higher natural gas prices if EPA’s rule is fully implemented
• Proposed rule will stifle innovation that allows companies to quickly find and fix methane emissions
  
• Natural gas-generated electricity is the primary reason America leads the world in lowering emissions

DENVER -- Western Energy Alliance today submitted public comments to the Environmental Protection Agency (EPA) regarding the proposed methane regulations under the Clean Air Act. The Alliance detailed how certain provisions of EPA’s rule will be technically infeasible to implement, lead to higher energy prices for Americans, and will benefit foreign nations with less restrictive environmental regulations.
 
The Alliance submitted two sets of comments to the agency, including a letter of its own and a joint letter signed by a coalition of 21 oil and natural gas trade groups.

“The coincidence is not lost on us that EPA’s deadline for public comments on the proposed methane rule fell on the same day Pres. Biden met with an OPEC nation to discuss increasing natural gas production. The administration is burdening American oil and natural gas producers with extensive new red tape, including the methane rule, while favoring Russian and OPEC producers,” said Kathleen Sgamma, president of the Alliance. “EPA cites false information (*see below) and ignores three decades of our industry’s success reducing methane emissions by 23 percent even as we increased natural gas production by 71 percent. The agency is also ignoring the fact that natural gas electricity generation continues to be the primary reason the United States has reduced more greenhouse gases than any other country.”
 
“The oil and natural gas industry supports balanced efforts to reduce methane emissions. However, this rule would stifle innovation by unnecessarily limiting the use of advanced aerial and continuous monitoring systems. Requiring inflexible and redundant detection methods in the field means this rule would slow the up-take of innovative technologies that enable companies to more quickly find and fix methane leaks.”
 
“EPA’s proposed rule would also disadvantage small producers, threatening up to 20 percent of U.S. production that comes from low-producing wells. It would contribute to increasing the costs of natural gas for consumers by further discouraging U.S. production. As we’ve seen over the past year, when natural gas prices increase, coal electricity generation increases and with it, greenhouse gas emissions, which could easily overwhelm the savings that EPA claims from this rule.”
 
By the numbers:

• EPA claims in its fact sheet that there will be annual savings of 3.15 million tons of methane (70.77 million metric tons {mmt} of CO2) from the proposed rule. (Fact sheet: 41 million tons {920 mmt of CO2} over 13 years from 2023 to 2035). In 2019 alone, natural gas electricity generation reduced 525 mmt of CO2 equivalents. By making natural gas production more expensive and raising the cost to consumers, the EPA rule puts that much larger GHG reduction at risk.

• EPA falsely claims that “the oil and natural gas industry is the nation’s largest industrial source of methane.” According to EPA’s own 2020 GHG inventory, the oil and natural gas industry emits 27.8 percent of U.S. methane emissions while agriculture is the largest contributor at 39.9 percent. How can the public trust EPA’s estimates when it misquotes its own GHG inventory?

Note: In the chart, Natural Gas Systems plus Petroleum Systems together constitute oil and natural gas industry emissions. Enteric fermentation, manure management, and rice cultivation together constitute the agriculture industry.

Fuel switching from coal to natural gas in the electricity sector has reduced more greenhouse gas emissions than have wind and solar energy combined. Because natural gas has 55 percent lower carbon dioxide emissions than coal, it delivers huge GHG reductions in the electricity sector, where emissions are nine times higher. Natural gas has delivered 61 percent of the reduction in greenhouse gases resulting from fuel switching in the electricity sector, removing 3,351 million metric tons of carbon dioxide equivalents (MMT CO2 Eq) since 2005. In contrast, wind and solar have reduced GHG emissions by 2,125 MMT CO2 Eq , or 39% of the total reduction. 

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