Now more than ever, it’s time for strong EU standards on methane emissions

As European Union leaders begin the transition from COVID-19 rescue to economic recovery, the need to build back better is taking center stage. Already, national governments representing over 65% of the EU’s population have insisted that leaders stick with the European Green Deal. Their resolve underscores the importance of leadership, resilience and science-based decision making in the face of the gravest health emergency of our time.

These national governments know that the EGD will help usher in a thriving, sustainable European economy that creates good jobs for working people. And they understand the tragic lesson of the COVID-19 crisis: that all nations must heed scientific warnings about public health and security. The scientific community’s clarion call on climate change, and the role of methane pollution in driving near-term warning, should be at the top of the agenda.

For the oil and gas industry, this means that a key component of the post-COVID recovery is the establishment of stringent standards to certify very low methane emissions for all gas used in the EU. Without such standards, the case for “cleaner-burning” natural gas evaporates; over the first 20 years, methane is 80 times more potent than CO2 in driving planetary warming. That’s why the European Commission’s forthcoming methane proposal presents a window that energy companies must take — and an ESG opportunity that investors cannot afford to ignore.

The outlook for natural gas in the EU is uncertain at best, as the industry’s reputation has steadily unraveled in the public eye.

• The rise of renewables is decreasing projected gas demand in Europe’s electric power sector, as commission officials weigh ending EU support for cross-border gas infrastructure.
• A growing chorus of environmental organizations is calling for a phase out of natural gas in Europe by 2035.
• Public opposition to the traditional oil and gas model has grown so sharp that BP’s new CEO Bernard Looney recognized that his company has lost trust and must earn it back through reimagining energy on a path to net-zero by 2050 or sooner.

In short, the energy sector, the companies that provide energy, and the climate all need a win and need it dearly.

Enter the European Commission’s methane opportunity. As the leading importer of internationally traded natural gas, the EU is uniquely positioned to set stringent methane standards for cleaner gas and to catalyze emission reductions around the world. Reducing methane emissions is actionable and immediate, as the technologies and management practices already exist, with more on the way.

So when should the methane standard be set, and what should it be?

The good news is, there is no reason to wait, and no need to reinvent the wheel. Recent history is the guide, and important corporate commitments show the way.

In 2017, senior executives of BP, Chevron, Equinor, ENI, ExxonMobil, Shell, Total and others committed to advocate government action to effectively regulate methane emissions.

In spring of 2018, BP committed to a 0.20% methane intensity target. That fall, with an audience of journalists and advocacy leaders looking on during Climate Week, CEOs in the Oil and Gas Climate Initiative doubled down on their pledged “near-zero methane” future and touted an ambition of reaching 0.20% methane intensity by 2025.

And in 2019, these companies and others developed with Environmental Defense Fund a methane policy framework that highlights climate goals, stakeholder confidence, and the need for “ambitious emission reduction outcomes”.

The bottom line: Policymakers cannot afford to be any less ambitious in this decade than energy companies were in the last one — 0.20% is the right performance benchmark to hit for gas production that supplies Europe.

Effectively administering a methane performance standard will requires development of scientifically grounded monitoring, reporting and verification standards, and sincere efforts to collaborate with Europe’s major natural gas suppliers such as Russia, Qatar and Norway.

Fortunately, current initiatives provide a running start, including methane protocols under development in the Oil and Gas Methane Partnership, international coordination through the Methane Guiding Principles, and advancements in satellite methane monitoring and quantification.

While we contend with the uncertainty of today, we must also press ahead where we can to improve the outlook for tomorrow. We know that oil and gas methane emissions are damaging but preventable, we know that emissions must be eliminated if there is to be a serious conversation about the role of gas in Europe’s energy transition, and we know that industry leaders already set the bar at 0.20% methane intensity for upstream by 2025.

As the commission and its consultant Wood solicit policy recommendations, the time is now for responsible oil and gas companies to voice their support of a protective methane standard in line with prior commitments.

The climate crisis and the trust crisis leave no margin for error.