Trump administration likely to eliminate penalties for methane leaks

Methane leaks are everywhere. Trump administration may abolish punishments aimed at commuting sentences

Written by Gene Kemnick & E&E News

Climate wire | The EPA on Tuesday finalized rules for a fee that oil and gas companies could start paying for excess methane emissions starting next year if Republicans don’t repeal it first.

The rule will guide implementation of the levy created by the Climate Act of 2022 and is the last major climate standard of the Biden administration. This was announced at an event accompanying this year’s UN climate conference in Baku, Azerbaijan, just before the US-China methane summit.

EPA Administrator Michael Regan, who did not attend the global conference, said the rule “is part of President Biden’s methane policy to improve efficiency in the oil and gas sector, support American jobs, and protect a clean environment.” This is the latest in a series of strategic measures,” it said in a statement. Strengthen aviation and strengthen America’s leadership on the world stage. ”

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The EPA estimates that the levy would remove 1.2 million tons of methane from the atmosphere by 2035, resulting in climate change benefits of “up to $2 billion.”

Companies will start paying a levy next year on excess emissions emitted in 2024. Oil and gas companies will pay $900 for every ton of methane that exceeds the standard set by the Inflation Control Act. The fee, known as the waste discharge fee, will rise to $1,500 per ton starting in 2026. This levy strengthens the EPA’s Clean Air Act regulations for methane by ensuring that operators pay a fee if they are not subject to or do not comply with these standards.

But President-elect Donald Trump’s victory last week casts doubt on the future of President Joe Biden’s methane policy, especially methane fees. President Trump could direct former New York Republican Rep. Lee Zeldin, who he announced Monday as the future EPA administrator, to reduce or eliminate elements of those policies. Zeldin faces Senate confirmation.

The Biden EPA has rolled out significant methane regulations at each of the past three UN climate change summits. For two decades, the administration has also built its climate diplomacy around the need to curb methane, a super pollutant 80 times more potent at raising temperatures than carbon dioxide.

The United States joined the European Union in 2021 and launched the Global Methane Declaration. As a result, more than 150 countries have pledged to work together to reduce global methane by at least 30 percent by 2030. Tuesday’s summit between the United States and China will be the second. Two of the biggest polluters are meeting to curb the powerful gas.

But under the Trump administration, the EPA could soon begin the process of rescinding Biden-era methane regulations and replacing them with more lenient standards, including those that encourage the introduction of methane fees. As the rule is being finalized late in Biden’s term, Republican lawmakers could override it through a Congressional Review Act resolution.

But experts say these steps do not exempt President Trump’s Environmental Protection Agency from implementing fees.

“The law is still the law,” said one industry advocate, who was granted anonymity to discuss future policy.

The CRA resolution would allow the Trump administration to create more industry-friendly methane rates. For example, it could make it easier for oil and gas companies to claim fee waivers provided under the Inflation Control Act. President Trump could also force businesses to defer bill payments until annual greenhouse gas reports are finalized at the end of the year. The Trump EPA would also allow companies to credit net emissions across their assets and potentially eliminate restrictions on how cleaner facilities compensate for dirtier ones to reduce fees.

If President Trump and Congressional Republicans want to eliminate methane fuel fees, they will need to enact legislation to eliminate them. Democrats and Biden have moved the IRA into an annual budget process, but Republicans could use a similar maneuver to cancel some of it. Industry groups such as the American Petroleum Institute and the Independent Petroleum Association of America oppose the fee.

Rosalie Wynn, an attorney with the Environmental Defense Fund, said the bill to eliminate the fee is “directly contrary to the interests of the American people.”

“We believe that reducing methane pollution will help mitigate the warming we are experiencing today and protect communities across America that are already affected by extreme weather events and rapidly increasing insurance costs. “We know that this is the most important and least costly way to do this,” she said. He noted that methane fees are a revenue-increasing source and their repeal would increase the federal deficit.

The fee is unpopular with the industry, but not all of Biden’s other methane policies are unpopular.

The EPA plans to release hundreds of millions of dollars from the IRA in the coming weeks to help carriers reduce emissions. Many oil and gas industry advocates are concerned that scrapping the EPA’s rules on leak prevention and monitoring could leave U.S. companies vulnerable to international and national methane policy. They also note that many operators have their own climate change initiatives that largely align with the EPA’s methane rules.

This story also appears below energy wire.

Reprinted from E&E News Published with permission of POLITICO, LLC. Copyright 2024. E&E News provides news that matters to energy and environment professionals.