Finally. After years of information gathering and analysis, EPA recently signed new source performance standards that will address methane and VOC pollution from new and modified sources within the oil and gas sector (“Final Rule”), EPA’s first-ever methane standards. EPA estimates that this rule is expected to prevent 300,000 short tons of methane pollution and 150,000 tons of VOCs in 2020. By 2025, the avoided pollution numbers rise to 510,000 tons and 210,000 tons, respectively. With natural gas production expected to grow by more than a quarter in the next decade, and emissions likewise expected to increase without new standards, the emissions these standards will prevent represent an important step towards meeting the White House’s pledge to cut oil and gas methane pollution 40 to 45 percent below 2012 levels by 2025. Indeed, the most current Greenhouse Gas Inventory shows that the oil and gas sector is the single largest polluter of methane in the U.S. Clearly, achieving significant reductions in methane from this sector is important if we are to meet President Obama’s overall greenhouse gas reduction targets of 17 percent below 2005 levels by 2020 and 26 to 28 percent by 2025.
EPA significantly improved the Final Rule from the proposal, which is great news. Perhaps most notably, all well pads must now regularly be inspected for fugitive emissions, as compared with the proposal, which would have exempted marginal, or low producing, wells (those wells that produced less than 15 barrels of oil equivalent per day). That exemption would have had dire results: 24 percent of all new wells, which account for 20 percent of total fugitive emissions from well pads, would not have been subject to inspection requirements. While these wells are low-producing, measurements show that they can still act as “super-emitters” that leak between 1 percent and 100 percent of the gas they produce, leading to very high absolute fugitive emissions. Requiring the owners of these well to regularly check for leaks will go far to reduce the unnecessary amount of methane pollution that is emitted from this sector, and is a huge benefit of this final rule.
Another important change EPA made from the proposal has to do with the frequency of required well pad and compressor station leak inspections. The final rule requires quarterly inspections for compressor stations and semiannual inspections for well pads. This is a significant improvement over the proposed frequencies, which were based on the percentage of leaking components that the operator reported finding at the prior inspection. Under the approach in the proposal, operators would have been allowed to perform inspections less often if they reported finding fewer leaks (based on a percentage of the total number of components at the site). That scheme would have created perverse incentives for operators to game the process in order to detect fewer leaks. This variable frequency scheme also assumed that finding a small number of leaks at one inspection means that the facility has, and will continue to have, a lower leak rate. But, through our comments, we pointed out to EPA that this is an incorrect assumption; the percentage of leaks at any given facility is not correlated with the amount of total methane pollution from that site, since leaks vary in size and large super-emitter leaks can – and do – occur anywhere.  Because leaks of any size can occur at any time, it is important that facilities are required to regularly inspect in order to minimize those emissions, which the Final Rule now does. While we pointed out to the Agency in our comments that a standard requiring quarterly inspections for both well pads and compressor stations would be cost-effective and would best reduce methane pollution associated with leaks, EPA’s final standard requiring fixed inspection frequencies, and require quarterly inspections at compressor stations, represents a considerable improvement compared to the standard it proposed.
The final Methane NSPS is better than the proposal to be sure, but it is still far from perfect. Namely, the final rule fails to address methane pollution from a number of important sources and events, such as storage vessels, liquids unloading, intermittent-bleed pneumatic controllers, and compressors located at well pads. We also note that EPA allows operators to use older “Method 21” leak detection instruments and methodologies, despite the fact that using IR cameras is typically more effective (and cheaper!).
Finally, while addressing new and modified sources is an important first step, there is still much we need to do if we are to meet the Administration’s goal of reducing methane emissions by 40 to 45 percent below 2012 levels by 2025, in addition to the overall climate goal. As we’ve noted before, there is a large gap between the reductions that could be achieved by this NSPS, EPA’s upcoming Control Techniques Guidelines (CTGs) and BLM’s Waste Rule, and the reductions necessary to meet the 40-45 percent reduction pledge. Failing to issue nationwide standards for methane emissions from oil and gas operations will leave 75 percent of current methane emissions from this sector uncontrolled, even with the NSPS, CTGs and the Waste Rule in place. It is existing sources that make the oil and gas industry the country’s highest methane emitter – but those sources are not addressed by this final rule. To bridge this gap, EPA must require existing sources within the sector to reduce methane emissions by roughly 75 million metric tons of carbon dioxide equivalent (MMT CO2e), based on a 100-year global warming potential of 25. Putting this in perspective, the NSPS will reduce emissions by 11 MMT CO2e in 2025.
By finalizing the Methane NSPS, EPA has now triggered a statutory duty to issue emission guidelines to address methane pollution from existing sources within the oil and gas sector. To build on the foundation laid by the final Methane NSPS and take the next step toward reducing the sector’s methane pollution, EPA has also started an information collection request process, through which it will seek information from a broad array of oil and gas sources.
Given the high stakes presented by our changing climate and our global commitments to help reduce the pollutants that are causing this change, it is absolutely critical for EPA to address existing sources as quickly as possible.