Energy Exchange

A massive wave of market and societal forces is changing the oil and gas industry. Low commodity prices are driving out weaker players with excessive debt, and forcing those that remain to become leaner and more efficient. As climate change effects worsen and countries move to fulfill their commitments from the Paris climate agreement, public scrutiny of oil and natural gas and their impacts only intensifies.

The question is not will industry change to meet these challenges — it’s how. It’s about what opportunities can propel industry to come back stronger out of the depths of the commodity slide, as a leaner, cleaner industry standing on firm ground that it can play a meaningful role as societies work to transition to lower-carbon economies.

While natural gas remains a fact of life, and switching from coal to natural gas has helped reduce greenhouse gas emissions, scientific research has demonstrated that potent methane emissions from the oil and gas system are undermining that climate benefit. The latest U.S. inventory shows over 9 million metric tons of oil and gas methane emissions, packing the same climate impact over a 20 year timeframe as over 200 coal-fired power plants. That’s a lot of methane no matter how you slice it. Read More »

Year two of the California legislative cycle usually yields some bold policy ideas – and this year it looks like rethinking California’s relationship with methane and natural gas is on track to do just that.

Given the fresh memories of the major methane pollution event at Aliso Canyon, the 20-plus bills introduced on the topic this legislative session – vastly more than in past years – aren’t surprising in the least. Moreover, 2016 could have a monumental effect on the methane and natural gas picture in the state for years to come.

What is responsible for this sudden increase in efforts to change California’s relationship with methane and natural gas.

The science is clear

First, the science is clear, as methane, the primary component of natural gas, is responsible for about 25% of the manmade climate change we’re experiencing today. With temperature records being broken nearly daily (2015 was the hottest year on record, and February 2016 was the hottest month ever globally), the cat is out of the bag – it’s past time to focus on methane.

The legislative pump is primed

California started down the path of finding solutions to address methane emissions years ago with a series of bills and policy actions, and in many ways the 2016 bill package doubles down on that progress. Read More »

Today, over 12 million Americans live within one-half mile of oil and gas operations. These facilities are located where people work and recreate, and where children go to school. While the administration has taken critical initial steps to limit pollution from some of these operations, their efforts to date don’t get the job done: Approximately 75 percent of today’s oil and gas operations still do not face any federal requirements to limit their emissions of harmful methane and toxic air pollution.

It’s great to see growing national and international interest being brought to an issue that was deserving of attention many years ago. But we need to move faster to rein in this problem.

Why the urgency? Here are four reasons:

1. Americans across the country are seeing the impact of an uncontrolled oil and gas industry on their air quality.

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Aliso Canyon was a big methane release, especially in Los Angeles, but in the grand scheme of methane released every day by the nation’s oil and gas industry, it was a blip. And recent footage from Texas, coupled with a new study of over 8,000 oil and gas wells gives a glimpse at the kind of leaks that are happening outside of California’s borders – leaks that have huge implications for the state.

The Texas infrared footage shows a cloud of methane leaking from a pump jack in an oil field in Texas’ Permian Basin. While these smaller leaks may not be as egregious as the one at Aliso Canyon, they often go undetected and unaddressed, adding up to a large amount of pollution. And as these leaks happen in Texas – with little plans to stop them – the climate footprint of the gas supply system continues to increase.

So what does this have to do with California? California imports nearly 90 percent of its natural gas from regions across western North America, with a large portion coming from Texas production areas like the Permian and Anadarko basins. To put it another way: when it comes to the climate, what happens in Texas doesn’t stay in Texas. So even while progress is happening to cut oil and gas pollution in the Golden State, there is still a lot of work to be done to make sure imported gas isn’t responsible for significant climate damage before it gets here. Read More »

The administration of Ohio Governor John Kasich announced today that the Ohio Environmental Protection Agency (OEPA) is taking another important step to reduce harmful air pollution from natural gas operations.

This isn’t the first time the Kasich administration has moved to address air pollution from the oil and gas industry. In 2014 Ohio joined Colorado and Wyoming in requiring operators to conduct quarterly inspections at well sites to find and fix emissions from leaking equipment. Today’s action extends these requirements upstream, and – notably — proposes to regulate both VOCs and methane, a move that helps cement Ohio’s position as one of the leading states on this issue.

Comprehensive methane rules are also under development in Pennsylvania (the nation’s second largest gas producer) and California (the nation’s third largest oil producer). Under both Republican and Democratic leadership, each of these states has recognized the benefits of keeping harmful emissions out of the air and valuable product in the pipeline. At the same time, they’re proving that these policies are highly cost-effective to implement. Read More »