Breaking News

Tweet TWEET

Obama Issues Climate Plan to Plug Methane Leaks

The Obama administration says it will propose rules to cut methane emissions at landfills and coal mines and conduct a study that may result in regulations to plug leaks from oil and gas production.

A 15-page plan released today pledges to work with utilities on curbing leaks in transport and distribution of natural gas and calls for the Environmental Protection Agency to study methane emissions from drilling to determine whether rules are needed. If it decides to regulate, the standards would be issued in 2016.

“Today’s announcement is a big step in the right direction,” David Doniger, director for climate at the Natural Resources Defense Council, said in a statement. “But more needs to be done.”

Methane is a greenhouse gas that’s 21 times more potent than carbon dioxide, and climate advocates have warned that without efforts to curb emissions from the nation’s booming oil and gas industry, President Barack Obama will fall short of his goal to cut emissions. Representatives of companies such as Exxon Mobil Corp. (XOM) that produce the fuels warned that new regulation could harm their growth.

Voluntary Measures

Instead of new rules, Obama should encourage voluntary and state efforts, the American Petroleum Institute, a Washington-based association of energy companies, said.

“Additional regulations are not necessary and could have a chilling effect on the American energy renaissance,” said Howard Feldman, director of regulatory affairs for the group. “The industry is innovating and doing things as quickly as possible.”

Environmental groups say tougher standards are needed after a February report showed leaks of methane from drilling and transporting natural gas are 25 percent to 75 percent greater than government estimates.

“The most important work of turning this strategy into action lies ahead,” Fred Krupp, president of the Environmental Defense Fund, said in a statement. “This strategy has the potential to deliver the federal regulatory oversight that is needed to complement state efforts.”

Climate Plan

In June, Obama outlined policies to lower U.S. pollution blamed for global warming, including limits on emissions from new and existing coal-fired power plants.

Obama’s goal is to cut such emissions 17 percent below 2005 levels. With a politically divided Congress that is unlikely to adopt climate measures, the administration is focusing on actions that can meet the target without legislation.

When burned to produce electricity, natural gas emits about half the carbon dioxide, the main gas linked to global warming, as coal. If too much methane, the main component of natural gas, escapes during production and transport, that environmental benefit is diminished or lost.

Environmental groups and the administration have said many of the mandates to reduce leaks are cost effective for companies because captured methane can be sold.

Obama’s first attempt to curb methane from energy production came indirectly in 2012 with a rule to limit volatile organic compounds that escape from wells in gas production. Systems that capture the organic compounds will also trap methane. Those rules didn’t apply to oil wells.

Flaring Wells

Today’s initiative targets methane directly and may lead to broader regulations.

Separately, the Interior Department will issue rules to curb methane venting or flaring from wells on public lands later this year, according to the plan. The department will also propose a rule to capture waste mine methane on federal lands.

In addition, the EPA this year will propose standards to reduce methane emissions from new landfills and study new rules for existing dumps. According to the administration, they are the first rules to target the potent greenhouse gas.

The White House praised efforts by utilities to upgrade pipes and compressors to improve the safety of the delivery system, and vowed to have the Energy Department look at how it could support further upgrades.

“On the distribution side, they recognize that the trend is positive, and we are reducing emissions because of our focus on safety,” Dave McCurdy, the president of the American Gas Association, which represents companies that deliver natural gas, said in an interview. “We share some common goals.”

To contact the reporters on this story: Mark Drajem in Washington at mdrajem@bloomberg.net; Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net Steve Geimann

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.