Completing the Bridge to Nowhere: Prioritizing Oil and Gas Emissions Regulations in Western States

71 Pages Posted: 25 Aug 2014 Last revised: 16 May 2015

Date Written: April 1, 2015

Abstract

America’s energy portfolio is rapidly changing. The hydraulic fracturing boom has spurred domestic oil and gas production. Though the media has focused largely on issues related to water quality, the boom’s greatest environmental impact may be on air pollution and the climate. Whether that impact is positive or negative is hotly contested. Abundant natural gas is championed as a “bridge fuel” away from coal and into a low-carbon energy future. For example, President Obama’s March 2014 Climate Action Plan relies on reducing coal use, and assumes that natural gas has climate benefits over coal.

But this assumption is far from certain. Scientific knowledge about the oil and gas sector’s emissions, specifically about how much methane the sector emits and how it contributes to ozone formation, has boomed as rapidly as hydraulic fracturing itself. A review of the many studies published since 2009 shows that the oil and gas sector is contributing to ozone problems throughout the western United States. It also shows agreement among scientists that oil and gas production emits significantly more methane, a greenhouse gas much more powerful than carbon dioxide, than previously thought. Scientists remain divided over which timeframe is most relevant for the climate. Natural gas lacks climate benefits over coal in a shorter, twenty-year timeframe, but likely has climate benefits over coal in a longer, hundred-year timeframe. America has stepped onto the natural gas bridge, unsure if it is a bridge to a low-carbon future, or a bridge to nowhere.

But that uncertainty will soon be alleviated, if not eliminated. On January 14, 2015, the Obama Administration announced a new goal to cut oil and gas sector methane emissions by 40-45% from 2012 levels by 2025, as well as several proposed actions that would allow the nation to achieve this ambitious goal. According to the White House’s press release, by the summer of 2015 the Environmental Protection agency (EPA) will update existing standards for volatile organic compound (VOC) emissions from new and modified oil and gas sector sources, and also propose a new standard for methane emissions from those sources. The EPA will also focus on assisting states in reducing ozone precursor emissions from existing oil and gas infrastructure in areas that fail to meet the agency’s ozone standards.

These forthcoming changes in federal regulations will also require states to act. Some states have already begun to do so. In early 2014, Colorado took the lead and became the first state to directly regulate the oil and gas sector’s methane emissions. The forthcoming federal regulations will require other states to follow Colorado’s lead. Many of these actions will focus on implementing whatever regulations the EPA develops to reduce methane emissions from the oil and gas sector and to further reduce the sector’s VOC emissions. But some states, especially western states, may have to go beyond that baseline in order to address ozone precursor emissions. Notably, the EPA recently designated areas in Colorado, Wyoming, Utah, and Texas in nonattainment with its ozone standard, in part due to oil and gas development. On November 26, 2014, the EPA announced that it will strengthen its ozone standards, which will likely mean that even more areas will be in nonattainment. State regulators may thus have to craft additional strategies to address the oil and gas sector’s ozone precursor emissions.

Of course, state and federal regulatory efforts focused on reducing ozone precursor emissions will also reduce methane emissions. Oil and gas equipment and processes leak mixed streams of hydrocarbons, including both methane and other hydrocarbons regulated as ozone precursors. Regulations targeting ozone precursors will plug the same holes from which methane also leaks.

There is no doubt that over the next few years, states will have to engage in extensive rulemaking to reduce methane and ozone precursor emissions from the oil and gas sector. This Article seeks to aid stakeholders in western states interested in crafting those regulations by providing the relevant scientific, legal, and engineering background. It focuses on eight western states, where the majority of oil and gas development occurs: North Dakota, Montana, Wyoming, Utah, Colorado, New Mexico, Oklahoma, and Texas. The Article begins by discussing the science behind the oil and gas sector’s hydrocarbon emissions, translating findings from several recent studies into a form more digestible to policymakers. Next, it summarizes the current statutory and regulatory landscape governing oil and gas sector emissions at the federal and state level. Third, it describes the various equipment and processes within the oil and gas sector that emit ozone precursors and identifies technological solutions to cost-effectively reduce their emissions. Finally, it recommends specific regulations that state policymakers can and should adopt to reduce the oil and gas sector’s ozone precursor emissions. These recommendations will also be valuable to federal policymakers as they engage in crafting federal standards to meet the Administration’s proposed goal of reducing oil and gas sector methane emissions to 40-45% below 2012 levels by 2025. This Article thus provides a valuable source of information to federal and state policymakers and other stakeholders as they engage in the complex yet crucial task of “completing the bridge” to a lower-carbon future.

Keywords: oil and gas, emissions, methane, ozone, air pollution, state air pollution regulations

Suggested Citation

Minor, Joel, Completing the Bridge to Nowhere: Prioritizing Oil and Gas Emissions Regulations in Western States (April 1, 2015). 34 Stanford Environmental Law Journal 57 (2015), Available at SSRN: https://ssrn.com/abstract=2485890 or http://dx.doi.org/10.2139/ssrn.2485890

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