Waste Emission Charge, Defined

The methane Waste Emissions Charge (WEC), a component of the Methane Emissions Reduction Program included in the Clean Air Act, begins implementation this year. For 2024 methane emissions (metric tons) that exceed the threshold, the cost is $900 per ton, increasing to $1,200 per ton for 2025, and $1,500 per ton for 2026 and beyond. The EPA’s final methane rule was released March 8, 2024, with an effective date of May 7, 2024.

EPA’s final rule proposal contains WEC calculations and definitions as well as exemptions. The rule regulates oil and gas methane emissions from new, modified, and reconstructed facilities and from existing facilities.

WEC Misalignment: Perspectives

There are several WEC components and provisions that are controversial, particularly EPA’s netting method, fee exemptions, and the proposed third-party super-emitter program.

Federal Agencies & Environmental Organizations

Netting of total methane emissions determines WEC fees, and the EPA mandates facility-level emissions be used to calculate fees.

The EPA rule allows exemptions for facility methane release due to permit delays when delay was not caused by the entity or the permit application itself, and only exempts flaring that would not have occurred with the permit granted. There is a fixed permit completion timeline.

Exemptions for permanently closed and plugged wells include only well-level leaks and emissions for the reporting year.

The third-party super-emitter program would authorize non-governmental groups to monitor for super-emitter events and report leaks to the EPA, who would require an operator investigation and report submission.

Industry Associations & Operators

Netting should be considered at the parent company level to consider the complete picture of emissions and reductions.

Fee exemptions should be on a case-by-case basis that consider whether a permit is “unreasonably delayed.” Gathering/transmission infrastructure permitting is complex, requiring multiple permits and reviews from local, state, and federal authorities.

Operators should be able to quantify and include overall emissions reductions from plugged and closed well sites.

The third-party super-emitter program gives compliance, enforcement and reporting authority to organizations that are unaccountable and not part of the federal regulatory system.

Other Stakeholders

There are lawsuits from states and industry groups both supporting and opposing the EPA’s methane final rule.

Some national and industry organizations believe EPA is overreaching its authority in regulating politically and economically significant issues.

Industry groups say the new rule imposes:

• Inflexible limits on scope of emissions netting
• Unreachable exemptions requirements/criteria
• Unrealistic regulatory timelines for compliance and reporting

There are also concerns about the influx of methane regulations, including Subpart W and other components of the final rule.

The industry has made great progress in reducing methane releases: the API estimates that average methane emissions intensity (2011-2021) was reduced by two-thirds across major production areas.

Balancing climate protection and national energy policies was never going to be simple. Finding common ground that incorporates both environmental and industry concerns and crafting a realistic, commonsense regulatory framework (based on accurate data) is the path to managing methane emissions while maintaining US energy security.

For operators seeking to reduce their methane emissions without breaking the bank or sacrificing production, BioSqueeze provides a proven solution leveraging innovative biomineralization technology efficiently eliminate methane.