The California Air Resources Board (CARB) approved the strictest and most comprehensive methane emissions regulations for oil and gas producers in the U.S. on March 23.
Environmentalists backing the measure believe it will mark a turning point in which states take greater roles in the regulatory arena as the Trump administration reduces the federal government’s footprint.
“This regulation will be the first major environmental regulation since the federal government turnover, and we think it’s a sign of things to come at the state level,” Tim O’Connor, director of the Environmental Defense Fund’s (EDF) California Oil and Gas Program, told journalists during a conference call.
The president of the Western States Petroleum Association, which represents producers in California, Arizona, Nevada, Oregon and Washington, expressed support for reducing emissions, but noted that the oil and gas industry was not the primary contributor to the problem.
“Our total industry sector emission, which includes oil production and natural gas storage, is 4% of the state’s methane emissions,” Catherine Reheis-Boyd said in a statement to Hart Energy. “Of that, less than 1% is from oil production.”
Reheis-Boyd also noted that the CARB rule paid too much attention to insignificant sources of methane.
“Emissions from a typical recirculation tank are approximately 26 pounds per tank per event, while statewide methane emissions from all sources are about 72 tons per year,” she said. “Thus, a recirculation tank accounts for less than 0.02% of annual California emissions.”
The industry has succeeded in reducing pollution on its own through measures such as the Leak Detection and Repair program, which has been in effect for more than 30 years, but are not acknowledged in the new rule, she said. The association is also concerned that CARB’s implementation schedule is overly aggressive.
CARB’s estimate of the industry’s contribution to statewide emissions is much higher than that of the association—15%—but that still means that the causes of 85% of methane emissions in California won’t be touched by this new regulation.
If the oil and gas industry in the Golden State feels targeted, the reason is that its methane leaks are easier to identify and control than those in the agricultural sector.
“One of the key reasons for reducing emissions from the oil and gas sector is that the solutions that are available are highly cost-effective and they are demonstrated. They are low-hanging fruit, if you will, to reduce methane emissions,” Elizabeth Paranhos, a Boulder, Colo.-based legal consultant specializing in clean energy policy, said on the call. “In addition, the legislature did direct the California Air Resources Board to establish a rule that would reduce emissions from oil and gas activities so there is a legislative mandate that is driving this rule as well.”
The argument about the cost-effective nature of the regulation stems from estimates of $50 million in natural gas that leaks into the atmosphere each year. Capturing it through a more rigorous inspection and repair regimen will mitigate at least some of that lost revenue, the EDF said.
For the most part, the industry’s operations are already clean, said Adam Brandt, professor of energy resources engineering at Stanford University. Only about 5% of oil and gas site components found to be leaking are considered to be very large emitters. However, that 5% is responsible for about half of all leaked emissions.
“The best scientific evidence suggests that these policies, while they do cost money and there is effort involved because of the gas saved and later sold, most or all of the cost of the regulation can be offset by additional revenues,” Brandt said. “It’s a very cost-effective way to reduce greenhouse-gas emissions for operators and for society as a whole.”
Backers of the stricter rules are cognizant of the president’s desire to trim federal regulations, especially concerning the oil and gas industry, as well as U.S. House bill HR 861, which proposes terminating the U.S. Environmental Protection Agency entirely by the end of 2018. They want states to occupy that regulatory vacuum.
“If the federal government won’t protect the people and the environment from oil and gas pollution, it has to be up to the states to be responsible actors,” O’Connor said. “The climate data say that it needs to be done. The economics shows that it works out and the people, we think, across the United States support it and they need it.”
The new policy focuses on incentivizing increased investment and production.
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