Impact of EU Methane Import Performance Standard
As the European Union (EU) considers the final terms of the Methane Regulation, CATF commissioned Rystad Energy to assess the potential trade, price, and emissions impact of a cross-border Methane Import Performance Standard (MIPS). This report shows that the trade and price implications of a phased-in import standard would be low, while the emissions reductions would be high.
- Adoption of MIPS could reduce methane emissions associated with oil and gas imports to the EU by at least 1.9 million tons per annum.
- Price impacts are minimal for natural gas, but could be noticeable for crude oil. However, price impacts for vehicle fuels would be trivial – about a cent per litre of diesel or petrol.
- Costs to exporters imposted by this policy would average only EUR 0.07/MMBtu for gas and EUR 1.33/barrel for oil.
- The policy would not present a risk to EU energy security, despite some possible diversion of oil and gas to other markets.
The EU was a co-founder of the Global Methane Pledge in 2021 and pledged to lead the way globally to address methane emission reductions. Implementing a bold EU Methane Regulation with a strong import standard would be one of the EU’s most impactful climate decisions of the decade, offering enormous returns on a small investment.