Ceres applauds the proposed methane rules released today by the U.S. Environmental Protection Agency, aimed at rapidly curbing emissions of the potent pollutant from all methane wells, for the first time extending the protections to cover existing oil and gas well sites, as well as strengthening emissions limits for existing facilities. The proposed rules would play a critical role in the Biden administration’s Methane Emissions Reduction Action Plan, announced today at COP26 in Glasgow.
The proposed rules, according to the EPA, will reduce emissions from covered sources, equipment, and operations by nearly 75%. The EPA also committed to a supplemental proposal to cover opportunities unaddressed in today’s announcement. It is important that the final standards be strengthened through that process to include limits on flaring and require regular monitoring of low-producing wells, which are disproportionately prone to leaks.
In recent months, the world's leading scientists and industry analysts signaled the urgent need to reduce methane emissions if we hope to limit warming to 1.5 degrees Celsius. Methane has a greenhouse gas impact more than 80 times greater than carbon dioxide in the first 20 years after it is emitted, and is already responsible for as much as 0.5 degrees Celsius of warming since pre-industrial times. An International Energy Agency report highlighted methane regulations as a crucial, cost-effective opportunity to close the gap to our climate goals, noting that even reduced fossil fuel use will not be enough to effectively abate methane emissions without “concerted efforts from governments and industry” to secure operational emissions cuts.
“The announcement from the Biden administration today and the newly proposed EPA rules are a strong first step to addressing methane emissions,” said Andrew Logan, senior director of oil and gas at Ceres. “We cannot allow lax regulations on methane to be one of the reasons that the U.S. falls short of its climate goals. Emissions and leaks from oil and gas wells endanger the health of nearby communities and represent lost product that should be of concern to both companies and prudent investors — there is no reasonable rationale for allowing these practices to continue. Investors, governments, scientists, and even the oil and gas companies themselves have called for strong methane regulations. We need to see the full weight of regulation and enforcement behind this crucial effort to reduce methane emissions, and need to ensure that these proposed rules become law, leveling the playing field for all operators.”
A variety of oil and gas companies including BP, Jonah, Pioneer, and Shell have spoken out in favor of strong regulation. Last May, investors representing $5.35 trillion in assets under management called on the Biden administration to set comprehensive regulations with strict enforcement aimed at urgently curbing methane emissions in a statement organized by Ceres and ICCR. In recent weeks, more than 90 countries have signed on to the Global Methane Pledge, committing to reduce methane emissions 30% by 2030 across all sectors through stronger emissions standards.Â
Methane-related emissions exacerbate respiratory illness and contribute to ground-level ozone and smog, increasing the risk of heart disease. Production practices like venting and flaring increase the likelihood of low birth weight, infant and child mortality, and cancer. These impacts hit industry workers and those living near well pads and fall disproportionately on vulnerable populations and communities of color.Â
In June, Ceres released a first-of-its-kind report benchmarking the methane emissions of oil and gas companies. It showed enormous gaps between the emissions intensity of production between companies — the bottom 25% of emitters generate 22 times the emissions per unit of production as the top 25% — demonstrating the considerable opportunity that exists to reduce methane emissions even within the oil and gas operations today.
The EPA aims to finalize the regulations following a 60-day public comment period and a review by other agencies.
About Ceres
Ceres is a nonprofit organization working with the most influential capital market leaders to solve the world’s greatest sustainability challenges. Through our powerful networks and global collaborations of investors, companies and nonprofits, we drive action and inspire equitable market-based and policy solutions throughout the economy to build a just and sustainable future. For more information, visit ceres.org and follow @CeresNews.