The U.S. EPA just moved to rescind Obama-era regulations from 2016 that targeted methane emissions from U.S. oil and gas wells—a move 2020 Democratic candidates are already pledging to reverse, with Amy Klobuchar at Wednesday’s CNN climate change town hall calling the move “very dangerous” and Bernie Sanders saying it is “setting us on a path to disaster.” These rules had required oil and gas companies to install leak abatement technology and regularly monitor their equipment for leaks of methane—a potent greenhouse gas—into the atmosphere. The administration has argued that its rulemaking is justified, in part, by the fact that firms already have an incentive to reduce leaks, since methane is itself valuable. This thinking could not be more wrong.
First, some facts. Methane is the main component of natural gas as produced by oil and gas firms and ultimately delivered to millions of furnaces, stovetops, and water heaters across North America. Gas is measured in millions of British thermal units (mmBtus) where a Btu is enough energy to raise the temperature of one pound of water by one degree Fahrenheit (yes, the U.S. oil and gas industry really missed the metric system boat). Largely because of the fracking boom, the United States now produces a lot of mmBtus of gas: more than 100 million of them per day (I’m using the fact that 1 thousand cubic feet of gas is roughly 1 mmBtu). And that gas is valuable, even at this summer’s low wholesale prices of around $2.40/mmBtu.
The problem is that getting all of that methane from wellheads, to gathering systems, to transmission lines, to distribution lines, and finally to your stove requires a lot of pipe connections. And if those connections aren’t made well and aren’t maintained, they leak. Estimates of how much methane leaks, and how much is due to fracking, vary and are highly controversial. For instance, Alvarez et al. (2018) estimates that oil and gas facilities’ leaks are 2.3% of total U.S. gas production, while Howarth (2019) estimates a higher leak rate of 3.5%.