The US Environmental Protection Agency is kicking off "listening sessions" May 2 on the implementation of the nation's first methane emissions fee for oil and gas producers and to help states and local governments build their methane monitoring and reporting capacity.

Supporters say accurate data is at the center of such efforts, for industry as well as for the credibility of the Biden administration's climate pledges.

The EPA received $1.55 billion to provide financial and technical support for its new methane reduction program under the landmark Inflation Reduction Act . The law allows air pollution control agencies, nonprofits and other institutions to apply for grants to plug leaks, shut old wells and deploy monitoring equipment.

But the most consequential change for the oil and gas industry under the IRA will be the 2024 roll-out of first-ever penalties for producers that release climate-warming methane into the atmosphere. Companies that emit at least the methane equivalent of 25,000 tons of carbon will be charged a $900 fee for each metric ton of emissions they emit in 2024, $1,200 per ton in 2025 and $1,500 thereafter.

Companies that use newly required empirical data to show that they fall below the 25,000-ton threshold will be exempt from the per-ton fee. They also can be exempt if they operate in a state that will meet the requirements of supplemental methane regulations that the EPA is expected to finalize in August.

Companies that emit at least 25,000 tons are required to report their emissions to the EPA's Greenhouse Gas Reporting Program. The data is then fed into the country's annual emissions report to the United Nations to support US climate pledges under the Paris Agreement on climate change.

A rush for better data

The Biden administration's multipronged push to rein in methane emissions hinges on rapid improvements in how such pollution is monitored and measured and on the robust verification of such data. Nations worldwide wrestle with similar challenges.

New research from the National Academy of Sciences published April 17 estimates that emissions from US oil and gas production fields were 70% higher than what the EPA's official data showed between 2010 and 2019.

The reliability of the EPA data from the US oil and gas industry has been questioned by researchers for years, making the efforts under the IRA so much more important, environmental advocates say.

"The IRA included language that specifically directed EPA to update its [emission] inventories, rather than just relying on modeling assumptions that have been shown to be outdated and not really reflective of what's going on," said Jon Goldstein, senior director of regulatory and legislative affairs for the Environmental Defense Fund, who focuses on state oil and gas policies.

Pursuant to the IRA, the EPA is developing new methodologies that will rely more on empirically collected data for its greenhouse gas reporting program, using overflight monitoring, satellites and ground measuring.

Successful methane mitigation also requires robust verification of such data to ensure measurements are accurate, Goldstein said. He suggested that a new rulemaking underway in Colorado to establish a verification protocol for the state's 2021 methane intensity standards for oil and gas drillers could create a model for the rest of the country.

Goldstein noted that forward-looking oil and gas companies are already proactive in trying to detect and mitigate emissions and more states may get on board once the methane rule is in place to help the industry avoid future fees.

"Our industry is at the forefront of data collection and advancing and utilizing cutting-edge technologies, including remote monitoring with satellites and laser-based aerial surveys, to detect and reduce methane emissions," Emily Hague, the American Petroleum Institute's director for upstream policy, said in an emailed statement. "Thanks to innovation and concerted industry action, average methane emissions intensity declined 66% across all seven major producing regions from 2011 to 2021."

Even so, the US "is still emitting a large amount of oil [and] gas methane concentrated in a few major production regions and with no sign of an actual emission decrease since production continues to increase," the Academy of Sciences report said.

Conversely, API has warned that the upcoming EPA rule could hamper production and lead to higher energy costs.

Methane is more than 80 times more potent as a greenhouse gas than carbon dioxide in the short term, and the concentration of methane in the atmosphere continues to rise. Emissions from the global oil and gas industry remained at near-record levels in 2022, with the US ranking among the top three emitters after China and India, according to the International Energy Agency.

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