With one of the most potent greenhouse gases on the rise globally, the U.S. Environmental Protection Agency announced a final rule Tuesday to reduce methane emissions from oil and gas production.
Proposed earlier this year, the rule imposes a Waste Emissions Charge on producers that exceed Congressionally set methane emission levels as a way of incentivizing technologies that prevent the gas from entering the atmosphere.
Thirty times more powerful than carbon dioxide, methane accounts for nearly 30% of the greenhouse gases that contribute to global warming. According to the EPA, oil and natural gas are the largest industrial sources of methane emissions in the U.S.
“EPA has been engaging with industry, states and communities to reduce methane emissions so that natural gas ultimately makes it to consumers as usable fuel instead of as a harmful greenhouse gas,” EPA Administrator Michael S. Regan said in a statement.
The rule is the result of a Methane Emissions Reduction Program included in the Inflation Reduction Act of 2022, which provided new authorities under the federal Clean Air Act to reduce emissions from the oil and natural gas industry and included more than $1 billion in funding.
The EPA estimates its rule will result in 1.2 million metric tons fewer methane emissions through 2035, or roughly the equivalent of removing 8 million gas-powered cars from the road for one year.
The finalized rule comes one day after President-elect Donald Trump announced former GOP Congressman Lee Zeldin as his pick to lead the EPA.
“[Zeldin] will ensure fair and swift deregulatory decisions that will be enacted in a way to unleash the power of American businesses,” Trump said Monday in a statement announcing Zeldin as his pick. Trump frequently says he plans for the U.S. to “drill, baby, drill” and increase oil and gas production.
The three-part EPA methane reductions program includes the EPA partnering with the Department of Energy to help the industry transition to no- and low-emitting technologies with financial and technical assistance. The two agencies will help provide support for methane monitoring and other means of lowering emissions.
The program also seeks to increase the accuracy of oil and gas companies’ methane emissions reporting and to encourage them to meet or exceed performance standards set by Congress.
The new Waste Emissions Charge will apply to certain facilities that emit more than 25,000 metric tons of carbon dioxide equivalent per year. The fees begin at $900 per metric ton in 2024 and increase to $1,200 in 2025 and $1,500 in 2026.
Under the terms of the Inflation Reduction Act, companies can reduce or eliminate the charge by deploying methane-reduction technologies the EPA says are readily available.
A request for comment from the U.S. Oil and Gas Assn. was not answered before deadline.
The EPA’s finalized rule comes almost three years after a group of 150 countries, including the U.S., agreed to reduce global methane emissions by at least 30% below 2020 levels by 2030 as part of the Global Methane Pledge of 2021 signed during the United Nations climate conference.
The 29th annual UN climate conference, COP29, is currently taking place in Azerbaijan.
According to the U.N. reducing methane emissions caused by humans this decade by 45% can keep global warming from exceeding 2 degrees Celsius — an irreversible tipping point after which the world’s population is at risk of polar ice sheets collapsing, coral reefs dying and other natural disasters.
The U.N, estimates reducing methane emissions can prevent 0.3 degrees Celsius of global warming by 2050.