For the first time, the Environmental Protection Agency (EPA) is finalizing a rule that requires oil and gas companies to pay for methane emissions. However, opponents argue that these standards could raise energy costs for Americans. They also raised questions about how long the new standards will even remain in effect with the Trump administration set to take over the White House.
Starting in 2024, companies will face a $900 fee per ton of excess methane, which will increase to $1,200 in 2025 and $1,500 in 2026.
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The EPA anticipates that by 2035, this rule could reduce methane emissions by 1.2 million metric tons. That’s equivalent to removing almost 8 million gas-powered cars from the road for a year.
Over the next decade, it projects up to $2 billion in climate benefits and increased innovations in methane mitigation within the industry.
Methane, often called a “super pollutant,” has over 80 times the warming effect of carbon dioxide in the short term. According to the International Energy Agency, emissions have contributed nearly a third of the global temperature increase since the Industrial Revolution began in the 18th century
While the EPA claims the rule will help curb climate change, opponents argue it is unrealistic and could effectively act as a tax on American energy.
Oil industry groups and Republican-led states previously contested another Biden administration methane regulation in court. However, the Supreme Court recently declined to block it while the case proceeds in lower courts. This new EPA rule is expected to complement the earlier regulation.
Industry advocates, including the American Petroleum Institute, have expressed intentions to work with Congress to repeal the rule, hoping for support under incoming President-elect Donald Trump’s administration.
