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Politics Daily on Energy: Oil and gas industry claims success for voluntary program to cut methane emissions

11:45  10 september  2021
11:45  10 september  2021 Source:   washingtonexaminer.com

Daily on Energy: Schumer betting on huge emissions cuts from infrastructure package

  Daily on Energy: Schumer betting on huge emissions cuts from infrastructure package Subscribe today to the Washington Examiner magazine and get Washington Briefing: politics and policy stories that will keep you up to date with what's going on in Washington. SUBSCRIBE NOW: Just $1.00 an issue! © Provided by Washington Examiner DOE Default Image - July 2021 EMISSIONS CUTS FROM DEMOCRATIC LEGISLATION: Senate Majority Leader Chuck Schumer says Democrats’ climate and infrastructure plans being pursued this fall have the potential to nearly fulfill President Joe Biden’s Paris Agreement pledge to cut U.S. emissions in half by 2030.

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INDUSTRY CLAIMS SUCCESS: The oil and gas industry is touting voluntary efforts of companies to cut emissions of methane and declaring progress on reducing flaring as the EPA gets set to issue new regulations for the potent greenhouse gas.

The American Petroleum Institute released its third progress report today on a voluntary program it started with 26 oil and gas companies in 2017 called the Environmental Partnership, which it created to limit leaks of methane and reduce emissions of related pollutants called volatile organic compounds.

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The report showed how the partnership, which has grown to more than 90 members, including large and small operators in every major U.S. oil and gas basin, has implemented a methane leak detection and repair program. Not all companies participating in the partnership are API members.

Participating companies conducted more 430,000 leak surveys in 2020 across more than 85,000 production sites, reporting a “leak occurrence rate” of 0.04%, or less than 1 leak in 2,000 components.

The leak rate is lower than the 0.08% the partnership reported the year before.

API also announced the results of a new component of the program launched last year encouraging companies to curb flaring, the practice of intentionally burning natural gas, which has become a significant contributor to greenhouse gas emissions.

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Participants in the partnership’s flare management program reported a 50% reduction in flare volumes from 2019 to 2020, even as oil and natural gas production remained consistent among participating companies.

These companies reduced the gas flare intensity of their operations from 3.04% in 2019 to 1.49% in 2020.

Fewer companies participated in this portion of the program (only 34), owing to challenges of smaller operators implementing it, according to Matthew Todd, director of the Environmental Partnership.

What about regulations? API’s CEO, in a press call this morning, touted the “strong results” of the flaring program and said the industry’s efforts to limit methane leaks represent “incredible progress.”

Sommers reiterated that API supports “cost-effective” regulation of methane from the EPA, which he said would “build on the progress” the industry is already making, while continuing to push back on Democrats’ proposed methane fee — a policy he called “a tax on American energy production.”

Australia needs help from the US to defuse the 'gas bomb'

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EPA Administrator Michael Regan recently said methane regulations his agency plans to issue this month on new and existing oil and gas sources would be “something that’s never been done as aggressively as we plan to do it.”

A coalition of 72 environmental and public health groups sent a letter to Regan today asking him to impose tough rules that apply to smaller production wells that are responsible for an outsized share of methane emissions. The groups aso urge EPA to require the use of zero-emitting pneumatic devices to curb emissions and to mandate the end of gas flaring all together.

Sommers said API is encouraging companies to stop routine flaring by a specific date and hopes EPA “will take into account new technologies and best practices” implemented in its voluntary program as the agency rolls out new regulations.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writer Josh Siegel (@SiegelScribe). Email jsiegel@washingtonexaminer.com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

Overnight Energy & Environment — Presented by Climate Power — Democratic leaders vow climate action amid divide

  Overnight Energy & Environment — Presented by Climate Power — Democratic leaders vow climate action amid divide Welcome to Monday's Overnight Energy & Environment, your source for the latest news focused on energy, the environment and beyond. Subscribe here: thehill.com/newsletter-signup.Today we're looking at President Biden and Senate Majority Leader Charles Schumer (D-N.Y.) pledging to take climate action, even with questions about whether they can accomplish their climate goals, a reported move on methane and the latest in a key house markup. ForToday we're looking at President Biden and Senate Majority Leader Charles Schumer (D-N.Y.) pledging to take climate action, even with questions about whether they can accomplish their climate goals, a reported move on methane and the latest in a key house markup.

BIDEN TAPS NEW FERC NOMINEE: Biden announced this morning he is nominating Willie Phillips Jr. to be the newest commissioner of the Federal Energy Regulatory Commission, an agency expected to play a major role in facilitating the White House’s aggressive climate agenda.

If the Senate confirms Phillips, who would replace former GOP commissioner Neil Chatterjee, it would give Democrats a 3-2 majority.

Phillips is chairman of Washington D.C.’s Public Service Commission, the utility regulator, and was previously assistant general counsel for the North American Electric Reliability Corporation.

In its statement announcing Phillips’ nomination, the White House said FERC — an independent agency — will play an “important role” as the administration looks to “tackle the climate crisis, advance environmental justice, and create a clean electricity grid by 2035.”

What’s on the agenda: Under Democratic chairman Richard Glick, FERC is currently considering imposing long-promised grid reforms to ease the building of electric transmission lines critical to speeding the growth of renewables onto the grid.

Biden’s goal of carbon-free power by 2035 will require a doubling or tripling of the U.S. transmission system, according to a recent report from the Energy Systems Integration Group.

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Phillips would also represent a crucial vote on FERC’s future pipeline siting policies, following a spate of recent opinions from the D.C. Circuit court directing the commission to further evaluate emissions and environmental justice concerns.

“Phillips’ deep legal understanding of the issues at stake and clear recognition of the benefits that renewable energy provides our nation’s communities are encouraging,” said Gregory Wetstone, president and CEO of the American Council on Renewable Energy, in a statement.

Biden’s selection of Phillips represents a safe choice: A moderate respected by the utility industry, Phillips worked at several law firms and also led efforts to implement the D.C.’s aggressive clean energy and climate goals at the PSC targeting 100% renewable energy by 2032.

An Alabama native, he began his career working for the state’s former Republican Sen. Jeff Sessions and interned in George W. Bush administration’s Office of General Counsel.

“We would describe him more as a ‘technician’ versus a ‘politician’ and a ‘green pragmatist’ versus a ‘progressive,’” the research group ClearView Energy Partners said in a note.

METHANE FEE COULD CUT LEAKS AT LOW COST...STUDY: A fee on methane emissions from the oil and gas system of the type being considered by Democrats as part of their reconciliation package would have small effects on natural gas prices while incentivizing companies to reduce methane leaks, according to a study released today by Resources for the Future.

Biden, world leaders try to hammer out next steps on climate

  Biden, world leaders try to hammer out next steps on climate Washington (AP) — President Joe Biden tried to hammer out the world's next steps against rapidly worsening climate change in a private, virtual session with a small group of other global leaders Friday, and announced a new U.S.-European pledge to cut climate-wrecking methane leaks. Ever-grimmer findings from scientists this year that the world is nearing the point where the level of climate damage from burning oil, gas and coal becomes catastrophic and irreversible “represent a code red for humanity,” Biden said at the session's outset.

“Like a carbon tax, a methane fee is a policy option that many economists see as a cost-effective approach to reducing emissions,” said Brian Prest, the author of the study. “Right now, emitters do not have sufficient financial incentive to reduce methane emissions because the market value of the lost methane is much smaller than the environmental costs.”

A low methane fee of $500/ton of methane could nearly cut the leak rate in half. Higher fees achieve larger reductions, but with diminishing returns. A $2,000/ton fee, for example, could reduce the leak rate by 70%.

The price effects are relatively low, particularly for small methane fees of $500/ton, which would increase wholesale natural gas prices by $0.07-0.10/MMBtu.

A $2,000/ton methane fee would increase wholesale natural gas prices by $0.18-$0.26/MMBtu. These increases amount to about 5% of current wholesale gas prices and about 1% of retail residential gas prices.

Oil and gas groups and Republicans from fossil fuel states are lobbying against a methane fee, arguing that charging companies for natural gas that escapes from their operations could lead to increased energy costs for consumers and would penalize companies that are voluntarily moving to reduce methane emissions.

ECONOMIC CASE FOR DEMOCRATS’ CLEAN POWER PROGRAM: The “Clean Electricity Payment Program” proposed by Democrats in Congress could create nearly 8 million jobs and $1 trillion in economic growth over the next decade, according to a report this morning by the independent consulting firm Analysis Group.

The study finds that Congress allocating $150 billion to the program, which would pay utilities to generate a growing share of clean electricity, would deliver major benefits by 2031, including:

Expanding the workforce by roughly 7.7 million jobs; injecting over $907 billion dollars into the U.S. economy; and raising $154 billion in tax revenue for federal, state, and local governments.

Biden, world leaders push climate action, vow methane cuts

  Biden, world leaders push climate action, vow methane cuts WASHINGTON (AP) — President Joe Biden tried on Friday to hammer out the world's next steps against rapidly worsening climate change with a small group of other global leaders and announced a new U.S.-European pledge to cut climate-wrecking methane leaks. Ever-grimmer findings from scientists this year that the world is nearing the point where the level of climate damage from burning oil, gas and coal becomes catastrophic and irreversible “represent a code red for humanity,” Biden said at the session's outset.

What’s driving the benefits? The economic gains are caused by a major buildout of clean energy resources, dispersing direct, indirect and induced economic benefits across the country.

The financial subsidies provided by the program would increase investment in solar, wind, and other low-carbon resources by nearly 628 GW by 2031, the study found.

Democrats’ CEPP, as the program is known by shorthand, would use a carrot-and-stick approach to push the utility sector to reach 80% clean electricity by 2030, by paying power companies to increase their clean energy portfolio while imposing financial penalties to ensure utilities don’t fall behind.

BUT...MANCHIN NOT DOWN WITH CEPP? Sen. Joe Manchin of West Virginia, the powerful centrist Democrat, has “balked” at his party’s push for a clean electricity payment program, CNN reported last night.

Manchin, who has threatened to oppose policies that are overly prescriptive on curbing fossil fuel use, has not been amenable to aggressive climate targets in negotiations with Democrats, leaving it “unclear where the talks will land,” the report said.

Manchin’s Energy Committee is tasked with devising the clean electricity payment program. That has made him the subject of major wooing by his colleagues, who say the program would promote natural gas plants equipped with carbon capture, and nuclear power — two priorities of Manchin.

Manchin has historically opposed climate policies that resemble a mandate requiring more use of renewables and less of coal and natural gas, but it’s unclear if the creative design of the Democrats’ program could mollify him.

DIRT OFF MY SHOULDER: House and Senate Democratic leaders said yesterday they plan to move ahead with their $3.5 trillion infrastructure and social spending reconciliation package despite a growing threat from Manchin that he’ll block it, the Washington Examiner’s Susan Ferrechio reports.

Democrats hope to consider the massive legislative package in the coming weeks, and they rejected a demand from the West Virginia senator to “hit the pause button” in order to reconsider the size and scope of the bill.

“We are moving full speed ahead,” said Senate Majority Leader Chuck Schumer, telling reporters in a conference call that he’s sticking to a September deadline for producing the legislation in committees.

Speaker Nancy Pelosi also brushed off Manchin’s threat, telling reporters that the House would move ahead with a $3.5 trillion measure.

Axios reported yesterday that Manchin has warned leaders that he would only agree to spend $1.5 trillion, which would appear to cut the Democratic proposal in half.

HURRICANE IDA HITS OIL DEMAND: U.S. oil demand fell sharply last week, primarily because of Hurricane Ida.

Oil demand declined to roughly 20 million barrels per day from 22.8 million barrels p/d the week prior, the Energy Information Administration said in its Weekly Petroleum Status report.

Demand is about 7% below the same week of 2019 before the coronavirus pandemic.

CHRISTIAN LEADERS ISSUE FIRST JOINT STATEMENT ON CLIMATE CHANGE: For the first time, the heads of the Catholic, Anglican, and Eastern Orthodox churches came together to draw attention to the "climate crisis,” the Washington Examiner’s Virginia Aabram reports.

“This is the first time that the three of us feel compelled to address together the urgency of environmental sustainability, its impact on persistent poverty, and the importance of global cooperation,” wrote Pope Francis, Ecumenical Patriarch Bartholomew, and Archbishop of Canterbury Justin Welby.

Titled “Joint Message for the Protection of Creation,” the statement traces climate change to human selfishness and admonishes people to look beyond their short-term material gain to care for the future of the planet and its people. The church leaders claimed that “the people bearing the most catastrophic consequences of these abuses are the poorest on the planet and have been the least responsible for causing them.”

MOVERS AND SHAKERS: John Reeder, who spent more than three decades at the EPA, including 17 years as a senior executive, has joined the Environmental Working Group as vice president for federal affairs.

Citizens for Responsible Energy Solutions announced yesterday that it hired John Nagle as a government relations associate.

The Rundown

Bloomberg World’s largest carbon-sucking plant starts making tiny dent in emissions

Washington Post Inside the Ohio factory that could make or break Biden’s big solar energy push

New York Times California recall vote could weaken the state’s aggressive climate policies

Wall Street Journal Battery makers tied to power grid attract big investors

New York Times High natural gas prices strain Europeans, weighing on recovery

Calendar

WEDNESDAY | SEP. 15

9:30 a.m. 406 Dirksen. The Senate Environment and Public Works Committee will hold a business meeting and hearing on EPA nominees.

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Tags: Energy and Environment, Daily on Energy

Original Author: Josh Siegel

Original Location: Daily on Energy: Oil and gas industry claims success for voluntary program to cut methane emissions

Biden, world leaders push climate action, vow methane cuts .
WASHINGTON (AP) — President Joe Biden tried on Friday to hammer out the world's next steps against rapidly worsening climate change with a small group of other global leaders and announced a new U.S.-European pledge to cut climate-wrecking methane leaks. Ever-grimmer findings from scientists this year that the world is nearing the point where the level of climate damage from burning oil, gas and coal becomes catastrophic and irreversible “represent a code red for humanity,” Biden said at the session's outset.

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