Energy Exchange

It’s time for the Texas Railroad Commission to curb flaring to prevent waste, protect property rights

By Scott Anderson / Published: April 22, 2020

This piece originally appeared in the Houston Chronicle

The Texas Railroad Commission has a unique chance to save the state’s oil and gas industry from one of its own worst habits — setting fire to over 100 billion cubic feet of natural gas each year, transforming a valuable asset into waste and pollution with zero benefit to anyone. Now, as commissioners eye production cuts in response to collapsing oil prices, they also have an opportunity to stem the profligate practice known as flaring.

The measure under consideration is called proration. Last used in the 1970s, it allows the commission to set a monthly production ceiling equal to market demand, with shares allocated among the state’s producers based on a variety of factors. Often described as a way to raise prices by limiting supply, authority for proration actually comes from the commission’s statutory obligation to prevent the waste of natural resources and protect property rights.

Flaring, of course, is the very definition of waste. Since 2013, operators in Texas have burned off roughly a trillion cubic feet of natural gas — enough to meet the yearly needs of every Texas home three times over. In 2019, Permian operators alone flared almost 300 billion cubic feet of gas, sending over a million dollars a day up in smoke.

Also posted in Air Quality, Methane, Methane regulatons, Natural Gas, Texas / Comments are closed

New data finds alarming levels of methane emissions in the Permian, posing long-term risk for oil and gas portfolios

By Dominic Watson / Published: April 21, 2020

Investors managing oil and gas portfolios are contending with major disruption as two interrelated crises play out: the global COVID-19 pandemic and extreme volatility in the price of oil. Yet even before these events, cracks were showing in the sector’s financial footing. Pressure has been rising on industry to improve returns, while demand to deliver on Environmental Societal Governance initiatives has never been higher.

Into this mix comes new data from scientists working with EDF’s PermianMAP initiative showing that methane emissions in the Permian Basin, the world’s largest oil field, is nearly three times the rate reported in Environmental Protection Agency’s nationwide statistics.

The 3.5% loss rate estimated in the data area is roughly 15 times higher than reduction targets set by leading producers, and significantly higher than many companies have reported. It translates to 1.4 million tons of wasted gas each year, enough to meet the annual natural gas needs of every home in Dallas and Houston combined.

The findings surface a material risk to oil and gas investors and to the future of natural gas from the Permian Basin. At current emissions rates from the basin, burning Permian natural gas for electricity does more near-term climate damage than coal.

A year from now, the U.S. oil and gas sector may look very different for many of the independent operators who make up a large portion of Permian producers. Withstanding this period of economic turbulence will require companies to make tough decisions. Yet even in this time of crisis, operators must keep an eye on future market demands, operational excellence and climate performance.

Permian study findings

The Permian sprawls across West Texas and New Mexico and has more than 100,000 operating well sites. Between October 2019 and March 2020, EDF scientists collaborated with academic institutions to collect data using tower-based monitors, ground-based mobile sensors, helicopters and fixed wing aircraft across a 10,000-square-kilometer study area responsible for 40% of Permian production.

The estimated 3.5% leak rate reflected in the new data stands in stark contrast to the .20% leakage rate agreed to by the 13 of the world’s largest operators in the Oil and Gas Climate Initiative, representing 30% of global oil and gas production. Furthermore, the emissions rate seen in the Permian is more than 10 times the methane intensity of 0.29% that OGCI has been reporting for 2018.

Also posted in Air Quality, Methane, Methane regulatons, PermianMAP, Texas / Tagged New Mexico | Comments are closed

New York is developing a gas planning framework, an important step to achieve its climate goals

By EDF Blogs / Published: April 9, 2020

By Erin Murphy

As New York implements a sweeping new climate law and moves toward decarbonization of its energy systems, state regulators are beginning to develop a framework to ensure the natural gas system is part of the transition.

EDF has long advocated that the New York Public Service Commission harmonize its natural gas policies with the state’s ambitious climate goals because natural gas distribution and combustion is a significant contributor to the state’s greenhouse gas footprint. Last month, the commission took a major step forward by initiating such a proceeding to develop a long-term planning framework for gas utilities.

Also posted in Climate, Natural Gas, New York / Comments are closed

Public health crisis underscores need to protect vulnerable Texans. Here’s how the PUC is responding.

By John Hall / Published: March 27, 2020

As Texans contend with the threat of the COVID-19 virus and an economic downturn, the state’s Public Utility Commission has adopted a proposal to prevent customers from having their power shut off in the midst of the current crisis.

Chairman DeAnn Walker initially put forward a set of policies on Tuesday to protect the state’s most vulnerable while keeping our competitive electricity market healthy and resilient. Today, the PUC advanced those policies with some changes.

Also posted in Electricity Pricing, Regional Grid, Texas / Comments are closed

Report shows Texas leadership on solar and wind is helping safeguard our power grid

By John Hall / Published: March 13, 2020

Last summer, Texas’ electric grid was put to the test by scorching temperatures that sent power demand soaring and raised the specter of potential brownouts. Thankfully, the grid did what it was designed to do and pulled through without any major issues.

This week, the Electric Reliability Council of Texas released its projection for how we’ll fare this summer. Thanks to massive growth of solar and wind resources made possible by Texas’ competitive electricity market, the outlook is much improved.

Also posted in Clean Energy, Solar Energy, Texas, Wind Energy / Comments are closed

Illinois’ Clean Energy Jobs Act puts people and climate first

By Christie Hicks / Published: March 12, 2020

Last week was a big one for Illinois energy advocacy. Hundreds of activists from around the state descended on the Capitol to rally and knock on legislators’ doors to persuade them to pass the Clean Energy Jobs Act now. Then, the Illinois House and Senate each held hearings where EDF and our partners in the Illinois Clean Jobs Coalition spoke with legislators to share a similar message: Momentum for clean energy legislation is picking up and CEJA is the only comprehensive piece of legislation on the table that protects both the environment and consumers’ pocketbooks.

In 2016, Illinois took bold action through the Future Energy Jobs Act, embracing of wind, solar and energy efficiency. By enacting this law, Illinois put itself on the front lines of the clean energy revolution.

However, transforming the energy sector is an ever-evolving, momentous task. It cannot be addressed in one fell swoop.

Also posted in CEJA, Clean Energy, Illinois / Comments are closed