EnergyFederalCongress Approves Reinstatement of Obama-Era Methane Regulations

By a vote of 229 to 191 last week, the U.S. House of Representatives passed legislation to re-establish the Obama-era regulations. It had already passed the Senate 52 to 42 back in April.

The regulatory rule established stronger restrictions on methane emitted during the oil and gas drilling, transportation, and refinement process — requiring those companies to invest in emissions-limiting technology or face steep fines.

Issued as a regulatory rule by the Environmental Protection Agency (EPA) under Obama, the restriction was formed on shaky legal footing since Congress did not pass its approval — then under sole GOP control.

In 2019, the Trump administration began the process of rolling back the regulation which was then fully implemented in August 2020 — just months before Trump lost re-election to Joe Biden.

At the time, the rollback was estimated to save the oil and gas industry $120 million through 2025 and then-EPA administrator Andrew Wheeler called the rules “unnecessary and duplicative regulatory burdens.”

Though, the oil and gas industry was divided at the time on the regulations with giant Exxon Mobil supporting the rules while smaller companies supported the rollback.

“Since the U.S. Environmental Protection Agency updated its New Source Performance Standards (NSPS) and permitting rules in 2016 for new, reconstructed and modified oil and gas sources, TIPRO has advocated against provisions that would have a disproportionate impact on smaller U.S. oil and natural gas producers,” president of the Texas Independent Producers & Royalty Owners (TIPRO) Association, Ed Longanecker, told The Texan in a Monday statement.

He added, “TIPRO will be participating in a small business panel and outreach meeting hosted by the EPA on its anticipated rulemaking. At this stage of the process, the EPA is seeking out information from stakeholders as it works to develop its new rule package.”

Texas’ Permian Basin is in many respects the epicenter of the United States’ energy renaissance that began in the late 1990s with the fracking revolution.

With that production spike has come higher emissions. Not among the list of Volatile Organic Compounds (VOC), methane is considered relatively non-toxic as it does not have an OSHA permissible exposure limit. But it is flammable and those concerned with its emission cite its warming potency — said to be 86 times more potent than carbon dioxide.

Methane is most prevalent in the mining of natural gas through conventional drilling or the more recent strategy of fracking. During the process, methane is often burned off rather than being released unalloyed into the atmosphere — a process called “flaring.”

Over the last decade, “flaring intensity” in the Permian Basin — i.e. the amount of gas flared per barrel of oil produced — decreased 64 percent according to a study from Texans for Natural Gas.

This practice, used throughout the entire world, has become a point of criticism by environmental groups whose desire it is to switch entirely away from fossil fuel-based energy and toward renewable sources like wind and solar.

Throughout his campaign, Biden tried to toe one of the biggest fault lines that exists within the modern Democratic Party. On energy, the progressive left’s green agenda runs starkly counter to the more moderate electoral constituency’s interests that often depend on the fossil fuel industry — whether it’s the coal mines of West Virginia or the fracking fields of Pennsylvania.

Since taking office, Biden has continued that effort — to varying degrees of success. Outside of this policy, Biden killed the Keystone XL pipeline project and issued a moratorium on new oil and gas drilling leases of federal lands, which is currently held up in court.

Both of those policies are a kind of middle ground between the two constituencies — moving energy policy leftward from the previous administration but stopping well short of where the environmental left wishes.

Biden’s overall energy agenda includes reaching net-neutral emissions by 2050 — a position reiterated during the recent summit with the European Union.

“We are determined to accelerate a climate-neutral future and ensure a just transition that leaves no one behind, including through low greenhouse gas emission technologies, an increasing uptake of renewable energies, a stronger engagement to promote clean energy innovation in Mission Innovation, increased energy efficiency and methane emissions reduction,” reads a White House release on the summit.

Nearly half of Texas’ electrical grid total capacity comes from natural gas generation while that source overperforms during times of peak demand — producing nearly two-thirds of the electricity during the February winter storm. The new regulation’s effect on the costs associated with natural gas production are unclear. 

With congressional approval, this renewed rule stands a better chance at withstanding legal scrutiny than its predecessor. And, if it survives, would need congressional approval to rescind should Republicans take control of the White House again.

Biden is expected to sign the law soon which will trigger the EPA’s rulemaking process that includes a 60-day public comment period.