The Fuse

Methane Crisis Needs Urgent Action

by Nick Cunningham | October 08, 2021

Slashing methane emissions from the oil and gas industry is one best and most urgent areas of climate action, according to a new report from the International Energy Agency (IEA).

The agency said that 75 percent of methane emissions from the sector can be eliminated with readily available technologies. But the oil and gas industry continues to stand in the way.

The methane crisis

Methane is an extremely powerful greenhouse gas – more than 80 times more potent than carbon dioxide over a 20-year period. Methane is also responsible for 30 percent of the global rise in temperatures to date, the IEA said.

A third of global methane emissions comes from the oil and gas industry. Methane is released in planned venting events, but it also leaks from well heads, compressor stations, pipelines, storage tanks, and even in infrastructure closer to end-consumers.

The IEA estimates that 70 percent of methane emissions from the sector could be captured using available technologies, and 45 percent at no net cost.

Cutting methane is the lowest hanging fruit for climate action.

Cutting methane is the lowest hanging fruit for climate action precisely because it is so potent and also because it does not live long in the atmosphere. If methane emissions are cut roughly in half by 2030, it could head off somewhere around 0.3-degree-Celsius temperature rise by the 2040s. The mission to slash methane pollution is all the more vital because the emissions are the result of waste (i.e. venting or leaking), and not the result of productive use.

“At a time when we are constantly being reminded of the damaging effects of climate change, it is inexcusable that massive amounts of methane continue to be allowed to just seep into the air from fossil fuel operations,’’ said Fatih Birol, the IEA Executive Director. “These emissions are avoidable, the solutions are proven and even profitable in many cases. And the benefits in terms of avoided near-term warming are huge.”

Importantly, the IEA said it is not sufficient to wait for demand-side policies to reduce consumption of fossil fuels. Instead, the cuts need to happen immediately from the oil and gas sector. The agency called for a combination of government policies and regulations, industry-led reductions, and improvements in data collection and transparency.

The IEA said it is not sufficient to wait for demand-side policies to reduce consumption of fossil fuels.

“We need substantial, economy-wide methane reductions this decade for us to stand a chance of avoiding the worst climate tipping points,” said Jonathan Banks, international director of super pollutants at Clean Air Task Force (CATF).

CATF has broken new ground on documenting methane emissions across the European continent. Typically, the conversation around methane venting and flaring has focused on rampant pollution in the Permian basin, perhaps creating the impression that methane is a problem stemming from some bad actors at drilling sites.

To be sure, places like the Permian are a huge problem – the Permian alone has emitted around 2 million tons of methane in the first nine months of 2021, according to satellite-analytics firm Kayrros, equivalent to the annual emissions of 40 million cars. The state of Texas conducts very little oversight and top state regulators are personally financially intertwined with the companies they regulate.

But the methane crisis cannot be narrowly laid at the feet of a handful of reckless drillers in one particular region. It is a much broader problem.

Methane leaks are common across the entire oil and gas supply chain in many parts of the world.

Using an infrared camera, CATF documented leaking methane from storage tanks, pipelines, LNG import terminals and other energy infrastructure at hundreds of sites in Italy, Germany, Hungary and Romania this year. The images and videos clearly demonstrate that methane leaks are a problem not just from producers, but also downstream in gas-importing countries. Or, put another way, the CATF footage expanded the understanding that methane leaks are common across the entire oil and gas supply chain in many parts of the world.

Cutting methane

The good news is that there is some momentum building. The United States and the EU recently announced a global pledge to cut methane emissions by 30 percent by 2030, building support for global action. No doubt methane will receive specific attention at the COP 26 international climate summit in a few weeks’ time in Glasgow.

But to reach that goal, the national level is where the rubber meets the road. The European Union is in the process of adopting comprehensive methane pollution standards that would cover data collection, mandatory inspections, and import standards, which CATF says could be “a model” for the rest of the world.

The U.S. is poised to tighten up federal regulations on the oil and gas sector.

The U.S. is poised to tighten up federal regulations on the oil and gas sector. The Environmental Protection Agency is writing the rules and is expected to roll that out soon.

At the same time, the U.S. Congress, as part of the sweeping budget reconciliation package currently being negotiated, is considering a fee on methane emissions from oil and gas companies.

But oil and gas industry lobbyists are fighting tooth and nail to block that methane fee. The industry is claiming to the public that a proposed fee on methane will result in higher natural gas prices, even though the tax would apply to unused (vented or leaking) gas, not gas delivered to consumers.

The oil industry has professed support for carbon pricing in the abstract, but with a real plan to price methane finally in the works, the industry is blitzing Congress to block it. The behavior on the proposed methane fee is quite illustrative of the industry’s approach to climate policy.

In Europe, gas lobbyists are swarming policymakers to ensure that natural gas is defined as “clean” in an upcoming decision on what energy resources are counted towards emissions goals. But as leaking methane across the industry demonstrates, it is very far from clean.

The IEA’s baseline scenario, which encompasses existing policies, shows a decline of methane emissions by less than 10 percent through 2030. The agency said that governments need to act to much more urgently. Clearly, the industry won’t cut emissions on its own.

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