Designing an EU methane performance standard for natural gas

The largest share of methane emissions footprint from EU gas consumption is estimated to come from upstream emissions in countries supplying gas to the EU. A methane performance standard on natural gas can be defined for the upstream segments of the gas supply chain using an existing methane emissions reporting framework (OGMP 2.0) and targets and definitions already developed by industry. A methane performance standard could take the form of a mandatory requirement that all natural gas sold on the EU internal market meets a benchmark upstream emission intensity value equivalent to 0.2%. To cover both imported and domestically produced gas, the point of obligation for a methane performance standard would likely need to be all EU gas shippers. To incentivize shippers to conform with the performance standard, they would need to be penalised for the portion of their gas volumes for which the methane emission intensity exceeds the benchmark value.