States Underscore U.S. Methane Momentum, Latest Reason for Canada to Press Ahead

U.S. states are accelerating steps to reduce oil and gas air pollution. Just last week Ohio – which has a Republican Governor, and Republican-controlled Senate and House – joined the list of states targeting oil and gas emissions with a new methane policy that requires operators to check for leaks at compressor stations four times a year. Showing that it’s not a matter of politics, but smart policy to require oil and gas companies to regularly inspect for and repair leaky equipment.

At the same time, Canada is developing its own requirements to cut oil and gas methane emissions by 45 percent, an effort that some in industry are resisting over concerns of possible U.S. federal policy changes. But Canada needs to keep its eyes on the states where action has taken hold for good reason.

Methane, a powerful pollutant, has emerged as a key energy and environmental challenge.

Natural gas is mostly methane. When it leaks and is vented from thousands of oil and gas facilities, methane loss to the atmosphere is wasted energy that hurts not only businesses but local economies.

Oil and gas operations also release smog-forming pollution that degrades air quality and can impact the health of people living near this development.

Companies in the oil and gas sector are among the largest sources of man-made methane emissions, which are responsible for about 25 percent of today’s warming.

States see clear benefits

Tighter controls for oil and gas emissions are popping up in red and blue states – including California, Colorado, Ohio, Pennsylvania, Utah and Wyoming.

Colorado was the first state to institute methane standards in 2014, and the pay-off has already been seen across the state. A recent industry survey reveals that the majority of companies have found the benefits outweigh the costs of complying with Colorado’s methane regulations.

States are seeing the job creation potential by managing methane emissions. There are hundreds of companies in the U.S. that manufacture products and provide methane mitigation services – and the prospects are growing to put thousands of more people to work.

Individual companies are also realizing the financial upside of controlling their emissions. In Wyoming, for example, one operator was able to boost operational efficiencies and recoup $5 million in what otherwise would have been wasted gas by enhancing leak detection and repair practices.

Will Canada catch up?

Reports find that similar routine leak inspection and maintenance efforts are a low-cost, high-impact opportunity that Canada can use to deliver sizeable methane emission reductions. In 2014 alone, nearly $550 million dollars (CAN) of natural gas (110 billion cubic feet) leaked from Canada’s industry. That’s enough gas to serve all of the households in Montreal every year – a terrible waste.

Right now, the Canadian federal government is developing oil and gas methane standards as part of its Pan-Canadian Climate Framework. And Alberta is working on its own set of methane regulations. Getting these regulations right by including quarterly leak detection and repair (LDAR) programs and following in the steps of several U.S. states that are showing how cost-effective, routine LDAR can help producing regions substantially lower methane emissions is essential for Canada to demonstrate its leadership. Currently the draft federal regulations only require leak detection and repair three times a year, and Alberta is unlikely to go beyond that. Across the U.S., the trend is clear with Ohio’s new methane policy: quarterly leak detection and repair is the best regulatory approach for finding and fixing leaks. If the Canadian federal and provincial regulations can’t meet that standard, Canada will only fall further behind.

Consider this: more oil and gas production is covered by existing or pending U.S. state regulations than what the federal Canadian regulations will cover. This is a powerful data point that speaks to the feasibility of addressing oil and gas methane emissions, both politically and technically.

There is enormous upside for Canada to move ahead with strong methane rules. Now it’s time for Canada to show that it won’t be left behind.

 

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