Aug 14, 2020 - Energy & Environment

The many divisions over Trump's methane rollback

Trump with people looking back at him

Illustration: Rebecca Zisser/Axios

EPA's decision to cut regulation of methane is laying bare an oil-and-gas industry divide and setting the stage for political battles this fall and beyond.

Why it matters: Methane is an extremely powerful greenhouse gas and the industry is a key emissions source.

Driving the news: The agency yesterday finalized rules that roll back requirements on curbing leaks from oil-and-gas wells and related infrastructure.

  • EPA boss Andrew Wheeler said the industry is moving to capture methane without "burdensome" regulations.
  • Environmentalists called it a dangerous decision that hinders efforts to fight global warming.

The intrigue: Here are a few takeaways from the move...

1. There's a rift between industry giants and independent companies.

  • Giants like BP and Shell attacked the move, while trade groups including the Independent Petroleum Association of America and Western Energy Alliance embraced it.
  • Quick take: There are differing motivations here. Multinational giants have more resources to comply and have already pledged emissions curbs, so it's even a competitive edge.
  • And the majors — especially the European-headquartered ones — have other incentives too as they seek to tout climate efforts and maintain their "social license" to operate.

2. The regulation's architecture could affect future rulemakings on climate change.

3. It can't be untethered from the 2020 elections and their aftermath.

  • Wheeler announced the rules in Pennsylvania, a big swing state Donald Trump carried in 2016 and a huge natural gas producer.
  • Joe Biden criticized the rules. And so did several senior congressional Democrats, a sign that they could seek to overturn them using the Congressional Review Act if Democrats control Washington next year.
    • The CRA allows Congress and a willing president to nullify regulations finalized late in a predecessor's term with special resolutions that are immune from filibusters.

4. EPA's action also has transatlantic implications.

  • Per Bloomberg, the rules "may provoke a backlash in Europe, where regulators are developing a methane strategy and eyeing tougher scrutiny of the carbon footprint of energy imports."
  • Their piece cites a recent note from ClearView Energy Partners, which says European officials could back "more rigid regulatory protocols to compensate for a continuing U.S. federal deregulatory posture."
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