Opportunity for US-EU Cooperation on Methane Emission Control

Will 2021 be a breakthrough year for global action on methane emissions?

In this Topic of the Month series, we will look at the international efforts to address methane emissions and will reflect where the major changes could come from this year.

Opportunity for US-EU Cooperation on Methane Emission Control

by Robert L. Kleinberg, Center on Global Energy Policy, Columbia University; Institute for Sustainable Energy, Boston University

The EU’s roadmap for future development, the European Green Deal, has the goal of making the continent climate neutral by 2050. Newly elected U.S. President Joseph Biden has identified climate change mitigation as a primary goal of his administration, too, but it is unlikely any plan comparable to the European Green Deal will be enacted by Congress. However, progress can be expected in the regulation of methane emissions from the oil and gas industry. If it chooses to, Europe can influence the scope and shape of those regulations, and moreover accelerate the adoption of best practices throughout U.S. oil and gas supply chains.

In the United States, regulation of methane as a greenhouse gas was initiated in 2016, during the Obama administration, and rescinded in 2020, during the Trump administration.

In fact, although the advertised purpose of eliminating methane regulations was to support the U.S. oil and gas industry, important portions of that industry opposed the changes [Agri & Kleinberg, 2021]. The politically conservative American Petroleum Institute, which as recently as August 2020 supported Trump administration deregulatory actions [API, 2020], has changed its position and now “is announcing its support for the direct regulation of methane from new and existing sources.” [API, 2021].

Coincidentally, the European Union is in the process of formulating a methane emission control strategy of its own. Since a large portion of the natural gas consumed in the EU is imported, effective greenhouse gas reduction strategies must include the monitoring and control of emissions from well head to port of entry. But parliamentary processes are slow and the growth of harmful emissions is fast. It would be helpful if exporting nations were to take steps to reduce methane emissions prior to final action by the EU. Therefore the EU would be well advised to send very clear signals to exporting entities now, detailing the range of possible actions the EU might take to implement a methane reduction strategy.

Prompt and clear communication will be particularly effective in dealing with the United States. Within hours of taking the oath of office, President Biden signed Executive Order 13990 identifying reconstitution of methane emission controls as a top priority, and directing the Environmental Protection Agency to prepare a plan to do so by September 2021 [Federal Register, 2021].

Thus European influence on United States government policy with respect to methane emission control is a rapidly wasting asset: a bureaucratic system that is very much open to suggestion now will gel and harden as it approaches the presidentially-mandated September 2021 deadline.

The potential effectiveness of this influence can be judged by the reaction to the cancellation of a $7 billion liquefied natural gas contract, which sent a shock wave into every corner of the US oil and gas industry [WSJ, 2020]. Remarkably, neither Engie nor the French government issued a press release explaining this action. It was left to journalists to supply explanations. It was assumed in many quarters that Europe was forcefully asserting its interest in dealing only with suppliers complying with strict – though as yet unspecified – environmental standards.

The EU should give stakeholders some idea of the range of possible authorities the world’s largest gas importing bloc might give itself. Prudent supplier nations and companies will prepare for the “worst”, i.e. the most stringent of a range of possible regulations. A “race to the top”, in which suppliers compete to take the lead in environmental performance, might well ensue, thereby accelerating the process of providing Europe with fuels consistent with its climate goals. It is none too soon to start the race, and Europe should fire the starter pistol.

References

Agri, P. & Kleinberg, R.L., 2021. Environmental Regulation: Response of Regulatory Agencies to Public Submissions, in preparation.

API, 2020. Modified EPA Methane Rules Support Further Emissions Reductions, American Petroleum Institute, 13 August 2020 https://www.api.org/news-policy-and-issues/news/2020/08/13/epa-methane-rule-2020

API, 2021. API Stands Ready to Work with Biden Administration on Methane Regulation, American Petroleum Institute, 21 January 2021 https://www.api.org/news-policy-and-issues/blog/2021/01/21/api-stands-ready-to-work-with-biden-administration-on-methane-regulation

Federal Register, 2021. Protecting Public Health and the Environment and Restoring Science To Tackle the Climate Crisis, Executive Order 13990. 86 Federal Register 7037, 25 January 2021 https://www.federalregister.gov/documents/2021/01/25/2021-01765/protecting-public-health-and-the-environment-and-restoring-science-to-tackle-the-climate-crisis

Kleinberg, R.L., 2021. EPA Methane Emission Controls, Obama vs Trump vs Biden: What Needs to Be Fixed and What Should be Left Alone, in preparation

WSJ, 2020. France’s Engie Backs Out of U.S. LNG Deal, 3 November 2020. https://www.wsj.com/articles/frances-engie-backs-out-of-u-s-lng-deal-11604435609

Relevant links:

Podcast: US Methane emissions regulations | Robert L. Kleinberg, Boston / Columbia University

Policy Brief: Regulatory framework to mitigate methane emissions in North America

FSR Opinion: The reversal of federal rules on methane (NSPS) does a disservice to the US oil and gas industry

FSR Opinion: The time is ripe to cut methane emissions in the natural gas value chain