EPA methane rules won’t hit gas utilities, industry predicts

Natural gas utilities aren’t expecting to be affected very much by potential methane leak regulations from the Environmental Protection Agency (EPA).

Leaders from the American Gas Association (AGA) said that utilities, also known as the downstream part of the supply chain, account for less than a quarter of a percent of all methane leaks in the country.

{mosads}And the costs of reducing leaks from utilities would outweigh many of the benefits of reducing the potent greenhouse gas.

“Down at our end of the business, I don’t know how much we’ll get caught up in those regulations, how much EPA will drag us into that, because studies have indicated we’re not the best target,” Terry McAllister, who will be AGA’s chairman for 2015, told reporters Thursday. McAllister is also chief executive officer of WGL Holdings, whose Washington Gas subsidiary serves the Washington, D.C., area.

The EPA will decide this month whether it should take new actions — through regulation, voluntary programs or otherwise — aimed at reducing methane emissions from the oil and gas sector. Methane is the main component of natural gas and has about 20 times the global warming power of carbon dioxide.

The agency is working off five white papers it gathered earlier this year, in addition to public comments it received on them and other input.

Dave McCurdy, AGA’s president and a former Democratic congressman representing Oklahoma in the House, said EPA’s communications suggest it will target gas sources with higher emissions, or where emissions are easier to catch.

“If you look closely at what the five EPA white papers addressed, most of those were upstream and transmission,” McCurdy said.

“They were the so-called fat tails or areas where they thought there was impactful, immediate benefits you could get from addressing those.”

McCurdy pointed to recent research on natural gas leaks to say that utilities are an extremely small part of the problem.

Furthermore, utilities are already spending $19 billion a year to replace pipelines, one of the most effective measures to stop leaks.

“The primarily thing we can do is to replace pipe,” McAllister said.