Gas Utilities Vow Methane Actions as U.S. Mulls Standards

Utilities have issued a plan to speed replacement of aging pipes and take other steps to cut climate-worsening leaks of methane, acting before the government can issue new rules.

The American Gas Association, a trade association for companies that send natural gas to homes and businesses, has drafted voluntary guidelines calling on utilities to remove older pipes, prevent venting during maintenance and do more to prevent contractors from severing gas pipes during work.

“It’s a real issue that affects everyone, and we are hearing about it from our customers,” Gregg Kantor, the group’s chairman and chief executive officer of Northwest Natural Gas Co. (NWN), said in an interview. “This is a recognition that we have got to deal with it.”

Methane emissions from natural-gas production, processing, transportation and distribution are drawing increased scrutiny as the boom in production using hydraulic fracturing has increased use of natural gas. Methane is 25 times more potent a greenhouse gas than carbon dioxide, although less prevalent.

President Barack Obama’s administration is considering drafting regulations to curb emissions of the potent greenhouse gas. If it decides to develop new regulations, it would finish them in 2016.

Power Plants

Obama’s proposed limits on carbon emissions from power plants will encourage greater use of natural gas, potentially resulting in more methane leaks.

That risk has gotten increasing attention from environmental groups, and from Obama.

In an interview with New York Times columnist Tom Friedman, published June 7, Obama said of gas production, “If it’s done badly, then you end up having methane gas emitted. And we know how to do it properly. But right now what we’ve got to do is make sure that there are industry standards that everybody is observing.”

In March, the administration pledged to work with utilities to curb leaks in the transport and distribution of natural gas, and called for the Environmental Protection Agency to determine whether rules are needed. If it decides to develop new regulations, it would finish them in 2016.

“As an industry, we are pretty much aligned with the administration on the methane-reduction strategy,” Kantor said. “We know the opportunity, and we also know the challenges.”

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

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

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