Will Natural Gas Burn Its Own Bridge?

Natural gas may have won over some critics because it is replacing the more carbon-intensive coal but its political strength might ultimately lead to its demise: It is pushing to ease methane rules established in 2016 which could do more environmental damage than carbon.

The Trump administration is sympathetic – the same group which is now working to undo other Obama-era regulations related to vehicle tailpipe emissions and CO2 limits set on power plants.

The Environmental Protection Agency has released a draft to ease up the time frame for which oil and gas companies must inspect and fix their leaks for fracking sites on publicly-held lands.

Instead of inspections getting conducted every six months, they could take place anywhere from one-to-two years. And instead of any leaks getting repaired within 30 days of finding them, those drillers now have up to 60 days to address.

Even the EPA says that it will cause the release of an additional 380,000 tons of methane into the air, although it will save US$75 million in regulatory costs; medical costs and environmental damages are not figured into those energy company savings.

But the natural gas companies cannot have it both ways. That is, those companies welcome the positive attention they are getting because their fuel is now the leading source used to generate electricity, at around 34%, and coal is less than 30%, and falling. That move alone has led to a decrease in heat-trapping CO2 releases – 18% less than they were in 2005, notes the Energy Information Administration.

But methane is 80-times more powerful than CO2 when it comes to trapping heat in the atmosphere. And a study published in the journal Science says that the US oil and gas business emits 13 million metric tons of methane from its operations year.

And that is 60% more than the US Environmental Protection Agency has estimated. In fact, the leak rate from existing operations is 2.3%, which is greater than EPA’s estimate of 1.4%.

That is still less than 3.2% – the point at which the benefits from switching to coal-to-natural gas are lost, a Princeton University study says.

Energy companies have a financial incentive to capture those escaping methane emissions because such “wet gas” is sold to chemical and manufacturing facilities that use it as a feedstock for their processes.

““To compete in today’s energy landscape you have to be both cheap and clean. The question now is whether leading companies are going to stand up against this misguided effort or let the Trump Administration take the entire industry backward,” Matt Watson, Associate Vice President, Energy, Environmental Defense Fund said.

Resisting Change

Watson goes on to say that the International Energy Agency has said that global methane emissions could get cut by 75% using technologies that are currently on the market – at little cost to oil and gas operations. Methane is responsible for about one-quarter of the global warming experienced today, he adds.

But the Western Energy Alliance has been leading the charge to undo the Obama-era rules, saying in news reports that the regulations are full of “red tape.”

It also says that the industry is voluntarily taking steps to reduce methane emissions –  that they have fallen 40% in recent years, even though natural gas usage has shot way up.

It’s members include Encana and Halliburton which have been involved in highly-publicised environmental mishaps: In 2011, the EPA accused of Encana of spoiling water supplies near Wyomings Pavillion natural gas field because of improper drilling techniques. Civic activist, meanwhile, have challenged Halliburton in Duncan, Oklahoma for allegedly contaminating drinking wells there.

But the good news is that BP, Eni, Exxon Mobil, Repsol, Royal Dutch Shell, Statoil and Wintershall have pledged to cut their methane releases while pushing regulators to strengthen those same policies.

The risk of greater heat-trapping emissions in combination with the drinking water contamination is why some environmental groups are leery of natural gas. They see it as blocking the path to a renewable future.

Pointing to the International Energy Agency’s studies, the Sierra Club says that such a strategy will still result in temperature rises of 3.5 degrees Celsius by century’s end – far more than the 1.5 degrees-2 degrees Celsius limit set by the Paris climate agreement.

The harder the oil and gas sectors push, the more resistance they will get. The Trump administration’s proposal will assuredly get challenged in the courts. But if natural gas would lose its support among the population-at-large, it would forfeit its status as a transition fuel.

Indeed, the biggest risk to the industry is that it would burn its own bridge.

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Source: Global Energy World