Colorado’s methane pollution verification rule is a game-changer: here are three reasons why

By Nini Gu

On Thursday, July 20^th we saw a major shift in how methane emissions from oil and gas sources can be regulated, and to no one’s surprise it came from the nation’s leading state on this issue: Colorado.

Methane is a potent, fast acting climate pollutant causing about a quarter of current global warming, and when it leaks from oil and gas facilities, it also creates harmful air pollution.  Fortunately, oil and gas methane emissions can be controlled and are one of the most affordable, actionable climate solutions we have.

Colorado first earned its reputation as a methane regulation trailblazer back in 2014 by establishing the nation’s earliest rules designed to reduce methane pollution from the oil and gas industry. Over the last 9 years it has continued that leadership with a series of groundbreaking actions. In 2021 the Colorado legislature set new targets to reduce oil and gas climate pollution 36% by 2025 and 60% by 2030. However, it wasn’t clear what tools operators and regulators would use to demonstrate that those new requirements were being met.

Colorado just fixed that on July 20^th when the state’s Air Quality Control Commission  unanimously adopted a new Greenhouse Gas  Intensity Verification Rule. This rule will help Colorado stay on track to meet its pollution reduction targets and could revolutionize the way others monitor, verify and report their emissions.

The state now requires the use of real, verifiable data to quantity emissions reductions. This rule vastly improves a largely guesswork and paperwork exercise into one that will increase transparency for the public, regulators and industry. We can now know for sure if pollution reductions are actually occurring. This rule — and crucially — the subsequent protocol to be developed this year — will also help fuel an already burgeoning methane measurement industry, creating jobs and spurring innovation.

Here are the three most important features of this new rule:

1. Requires the direct measurement of methane emissions at the production site level and the transparent reporting of measurement data.

This is the rule’s centerpiece and the fundamental reason that it’s such an important new chapter in methane emissions reduction. Across the U.S., our existing approaches for determining methane emissions use complicated calculations and emissions factors developed 30 years ago — but they’re ultimately not based in real-world methane measurements. These approaches are outdated and unreliable.

We need to know how much methane is actually being released into the atmosphere. This rule requires oil and gas operators to use real-world data to demonstrate that they are meeting the emission reduction standards adopted in 2021. AQCC recognized the importance of directly measuring the quantity of methane released, and adopted a rule rooted in this principle. Only direct measurement data can help create the necessary framework to ensure consistent usage of methane monitoring practices.

The methane measurement industry is ready for the challenge. It’s here, it’s cost-effective and it’s set to scale up to provide this crucial service. Direct measurement data will make it possible for the state to develop more accurate GHG inventories and stay on track to meet statutory climate targets.

2. Empowers regulators to ensure the rule is appropriately implemented and that industry is following it.

Following the adoption of this rule, the Air Pollution Control Division  must determine the exact details for how it will work in practice. The Division has two mandates: follow AQCC’s overall guidance (hence why the core features of the rules are so important) and create standards that hold industry accountable to the state’s oil and gas climate pollution reduction targets.

The rule gives APCD the authority to create a suite of pre-approved methane measuring programs, and the authority to review and decide on any operator-specific measurement programs that deviate from the pre-approved ones. Producers are required to keep transparent records of their strategies and emissions, which can be reviewed by APCD and will also be independently audited. APCD will maintain oversight of the auditing process.

Altogether, this rule empowers APCD to craft standards that will lead to a consistent, robust and scientifically valid structure for measuring oil and gas methane emissions throughout Colorado. The rule also places an emphasis on transparency and accountability that will help ensure the program’s long-term success. Without adequate oversight, too much discretion will fall on oil and gas operators, who are simply not equipped to self-standardize across a wide-ranging industry. The Division has to stay in charge to ensure statewide operator compliance.

3. Establishes a public process by the Division to develop and continuously evaluate a robust companion protocol.

Two things are true: First, the July 20^th rulemaking was a moment worth celebrating. Second, we still have a lot of work ahead for this rule to be successful. The devil will be in the same place he always is: the details.

In order to get consistent data from a lot of different operators we need clear guidelines for what tools they can use and how to use them. In the months ahead APCD will develop an operator protocol that will define those guidelines and make sure that each operator’s measurement program is effective.

Having clear guardrails in this protocol will be critical to the success of the verification rule, and the Division should engage with stakeholders throughout the writing process. Consistent stakeholder engagement is the best way to ensure a final product that is effective and workable.

After writing it this year, the Division will continue to evaluate the protocol annually for effectiveness and relevancy. Since the methane measurement industry is rapidly evolving, continuous evaluation allows APCD to revise and update the protocol to reflect best-available technologies and methodologies. If APCD decides to update the protocol, it will inform stakeholders and the public.

So: what does it all mean and where are we going next?

This achievement was the result of a lot of patience and hard work from a variety of different stakeholders. It took a decade of courage and innovation for one state to build this much momentum to regulate methane. With this rule being approved alongside a rapidly maturing methane measurement industry, the time is ripe for groundbreaking approaches to oil and gas pollution reduction.

With a strong protocol, Colorado can once again set a worldwide standard for bold action on reducing methane emissions from the oil and gas sector, and Governor Polis can show the nation how strong leadership, data and technology can be harnessed to solve urgent pollution problems and strengthen our economy. EDF is excited and ready to play our part in making this new chapter for methane regulations a successful one.