The United States Environmental Protection Agency (EPA) has announced a final rule aimed at reducing methane emissions from the oil and gas sector. This measure aligns with President Biden's Methane Emissions Reduction Action Plan, introduced as part of the Inflation Reduction Act. The new rule facilitates the implementation of a Waste Emissions Charge, designed to ensure that natural gas reaches consumers rather than polluting the air.
According to EPA Administrator Michael S. Regan, “The Waste Emissions Charge is the latest in a series of actions under President Biden’s methane strategy to enhance efficiency in the oil and gas sector, support American jobs, protect clean air, and bolster U.S. leadership on the global stage.”
The EPA projects that this rule will lead to cumulative reductions of 1.2 million metric tons of methane emissions by 2035, equivalent to removing nearly eight million gasoline-powered cars from roads for one year. These reductions are expected to provide up to $2 billion in climate benefits.
The Waste Emissions Charge targets high-emission oil and gas facilities reporting over 25,000 metric tons of carbon dioxide equivalent per year. The charge begins at $900 per metric ton for fiscal year 2024 and increases annually until it reaches $1,500 per metric ton by fiscal year 2026.
Changes have been made in response to public comments, granting facility owners more flexibility in achieving emission reductions and avoiding charges. States are incentivized to submit timely plans limiting methane emissions from existing operations.
Methane is identified as a significant climate pollutant with high heat-trapping potential compared to carbon dioxide. Rapid reductions in methane emissions are crucial for mitigating global temperature rise.
In March 2024, the EPA issued final rules under the Clean Air Act aimed at drastically reducing methane emissions from new and existing oil and gas operations. Alongside these regulations, over $1 billion has been allocated for financial and technical assistance through collaboration between the EPA and Department of Energy (DOE).
These initiatives position the United States as an efficient producer of oil and natural gas while ensuring competitiveness in foreign markets requiring low emission standards.
Further information can be found on the Methane Emissions Reduction Program website.
