The Trump administration may repeal a penalty meant to reduce methane leaks in oil and gas companies. The fee was created to push these companies to plug methane leaks, but it could be axed by the incoming administration. This move could hinder efforts to curb the potent greenhouse gas.
The Environmental Protection Agency (EPA) finalized regulations for a fee that oil and gas companies could begin paying on excess methane emissions next year. The rule, created by the 2022 climate law, is the last significant climate standard of the Biden administration. EPA Administrator Michael Regan stated that this rule is part of President Biden’s methane strategy to improve efficiency in the oil and gas sector, support American jobs, protect clean air, and reinforce U.S. leadership globally.
The levy is estimated to prevent 1.2 million metric tons of methane from entering the atmosphere through 2035 and provide up to $2 billion in climate benefits. Companies will start paying the fee next year for excess emissions released in 2024. The fee will increase over time, reaching $1,500 a ton for 2026 and beyond.
President-elect Donald Trump’s victory raises concerns about the future of Biden’s methane policies, including the methane fee. Trump could direct his future EPA administrator, Lee Zeldin, to roll back or eliminate elements of these policies. The Biden administration has focused on curbing methane, a superpollutant that is much more potent than carbon dioxide in raising temperatures.
Under Trump, the EPA could begin the process of replacing Biden-era methane rules with less strict standards. This could include changes to the implementation of the methane fee. However, experts note that the law still stands, and the Trump administration would have to implement the fee unless legislation is enacted to repeal it.
While the methane fee is unpopular with industry groups, some of Biden’s other methane policies are supported. EPA is set to release funds to help operators reduce emissions, and many industry advocates fear that abandoning EPA rules for leak prevention could leave U.S. companies vulnerable to international and state methane policies.
Overall, the potential repeal of the methane fee by the Trump administration could have significant implications for efforts to reduce methane emissions in the oil and gas sector. It remains to be seen how this issue will unfold in the coming months and what impact it will have on climate change mitigation efforts.