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Axios
07-05-2025
- Business
- Axios
Countries lagging on curbing methane emissions, new report says
Countries' pledges to cut methane aren't translating into nearly enough on-the-ground action to send emissions downward, the International Energy Agency finds in a new report. Why it matters: The powerful planet-warming gas is responsible for nearly one-third of global temperature rise since the Industrial Revolution, IEA said. The energy sector accounts for over 35% of methane from human activity. The big picture: Recent years have brought moves like the Global Methane Pledge, a multinational effort launched at the 2021 UN climate summit to drive a 30% cut in human-induced emissions by 2030. Another is the Oil and Gas Decarbonization Charter in 2023. Reality check: While a number of oil and gas companies are curbing methane, their efforts are not yet game-changing on a global basis. "[S]o far, few countries or companies have formulated real implementation plans for these commitments, and even fewer have demonstrated verifiable emissions reductions," IEA notes. State of play: Record oil, gas and coal production, combined with "limited" mitigation, have kept emissions above 120 million metric tons annually, IEA said. Agriculture is the biggest human-caused source, and waste is large, too. But energy has the greatest potential for near-term, cost-effective cuts, IEA said. Democrats included a fee on oil and gas industry methane emissions in the 2022 climate law, but both chambers of Congress this year voted to overturn it. Friction point: The IEA study wades into whether natural gas has a climate edge over coal on a lifecycle basis, i.e., including methane emissions in the value chain. IEA's answer? Generally yes, but comparing gas only to coal "sets the bar too low." The report also reveals that IEA's working on a big analysis of LNG-linked emissions and options for cutting them. Stunning stats: This year's tracker has first-time IEA estimates of methane from abandoned infrastructure. Former coal mines released 5 million tons last year, while another 3 million came from abandoned oil and gas wells. "Combined, these sources would be the world's fourth-largest emitter of fossil fuel methane," IEA finds, behind operational sites in China, the U.S. and Russia. IEA estimates around 8 million abandoned oil and gas wells globally, with many in the U.S., though they note that properly-plugged wells emit little.
Reuters
28-03-2025
- Business
- Reuters
Commentary: US LNG exporters could hit methane snag in Europe
March 28 - The Trump administration's broad policy goal of achieving 'energy dominance', opens new tab may run into headwinds in the country's largest export market, the European Union, due to new methane regulations. While European Commission President Ursula von der Leyen has indicated that the EU may be willing to import more U.S. liquefied natural gas (LNG), in part to reduce the bloc's trade deficit with the U.S., making this happen could get complicated. First, many utilities in the EU are hesitant about signing long-term LNG contracts, opens new tab given the uncertainty, opens new tab about the region's future gas demand and the price impact of the product's expected supply growth, opens new tab in the coming years. Rapidly deteriorating political relations with Washington are also not helping. Another complicating factor is the EU Methane Regulation, opens new tab that was adopted in August 2024. This framework established rules and obligations for companies operating in the EU related to monitoring, reporting, and verifying methane emissions as well as deterring and addressing methane leaks. This framework did not emerge in a vacuum. A major effort has been underway globally to better measure and monitor methane emissions associated with fossil fuel production and transport, as illustrated by forums such as the Global Methane Pledge, opens new tab, the Oil and Gas Methane Partnership, opens new tab, and the Oil and Gas Decarbonization Charter, opens new tab. The U.S. was previously part of this movement. The Biden Administration adopted a set of measures, including a methane fee, to curtail so-called 'fugitive' methane emissions from oil and gas systems through the Inflation Reduction Act (IRA)., opens new tab But the efforts in the U.S. are now facing headwinds in the early days of the Trump administration. PESSIMISTIC SCENARIO Going into 2025, the optimistic view was that the framework installed by the previous administration could be amended to make sure that U.S. LNG exporters could benefit from looser rules in the U.S. while still being able to compete in the global marketplace with a supposedly superior product. Unfortunately, early indications are that a more pessimistic scenario is playing out. In February, the U.S. Senate repealed the aforementioned fee on excess fugitive methane emissions, though the outright elimination of these fees is proving more difficult, opens new tab due to other stipulations in the IRA. More fundamentally, President Trump, in one of his executive orders, opens new tab, urged the Environmental Protection Agency (EPA) to challenge and possibly rescind the Agency's 2009 endangerment finding, which concluded that six types of greenhouse gas emissions pose a threat to public health and welfare. The EPA may face legal and scientific barriers, opens new tab if it tries to rescind this finding, as the EPA's authority and obligations to regulate GHG emissions have been cemented in the Clean Air Act through the IRA. But even talk about a change of this magnitude is generating significant uncertainty among U.S. energy producers, especially LNG exporters who still need to comply with stricter environmental rules in Europe. PATH FORWARD So what is next for U.S. LNG? Global demand for natural gas is robust and likely to remain so for decades. And U.S. LNG companies, which tend to have a long-term focus given the lengthy lead time of their projects, are apt to look beyond the Trump administration and seek to abide by European environmental standards to further cement their growing market share there. It is notable that American companies have been among the few to constructively engage with Brussels to find a pragmatic path to implement the current methane rules. However, U.S. natural gas supply chains are incredibly complex, and technologies to help detect and mitigate GHG emissions are by no means perfect. Consequently, improving the environmental footprint of U.S. LNG will be a long-term process. And that process may now be severely disrupted, so it will likely come down to the industry itself to make progress, possibly in close collaboration with lawmakers and regulators in jurisdictions like the EU. On the U.S. side, the LNG industry could push the Trump Administration to preserve the IRA's tax credits for carbon capture and storage (CCUS) technology, which Secretary of Energy Chris Wright seems to support, opens new tab, as do many oil and gas companies, opens new tab. And natural gas producers and shippers could make it clear how disruptive, and thus counterproductive, it would be for the endangerment finding to be rescinded. In a less constructive scenario, U.S. policymakers could mirror their counterparts in Qatar, who in December indicated to the European Commission that LNG exports would be halted if the country's state-owned company were to be fined under the bloc's corporate sustainability directive. The White House could also push back against the EU Methane Regulation or make it part of larger tariff negotiations, opens new tab. U.S. gas producers, LNG exporters, and EU lawmakers have an interest in preventing a zero-sum showdown, but it remains unclear how they will navigate this unfamiliar energy landscape where, at least politically, the U.S. and EU are moving further apart. (The views expressed here are those of Dr. Gautam Jain, a Senior Research Scholar at the Center on Global Energy Policy (CGEP) of Columbia University, and Dr. Tim Boersma, a consultant and a Fellow at CGEP.)
