The People of America's Oil and Natural Gas Indusry

Energy Progress vs. EPA's Politics

Mark Green

Mark Green
Posted April 19, 2016

Some important context before a discussion of a flawed emissions report from EPA, which follows below.

The United States is the world’s No. 1 producer of oil and natural gas – largely thanks to safe and responsible hydraulic fracturing and advanced horizontal drilling. Natural gas NG_outputproduction reached a record high level of 79 billion cubic feet per day in 2015, according to the U.S. Energy Information Administration (chart), while total U.S. energy output increased for the sixth consecutive year.

The increased natural gas production and use is critically important, as it is the key factor in reduced carbon emissions during a period of U.S. economic expansion – a break with historic precedent noted by the New York Times. Indeed, the United States is leading the world in carbon emissions reductions, largely thanks to its energy revolution.

Enter EPA, with its newest Inventory of U.S. Greenhouse Gas Emissions and Sinks – a fundamentally flawed report that puts political outcomes ahead of science. API’s Kyle Isakower, vice president of regulatory and economic policy, and Howard Feldman, senior director of regulatory and scientific affairs, held a conference call with reporters that questioned the methodology and motivations behind EPA’s new inventory.

Isakower said past inventories have shown falling methane emissions during a period of soaring oil and natural gas production. Last year’s inventory, for example, showed methane emissions from natural gas systems had dropped 11 percent since 2005. But this year’s version shows just a 0.68 percent decline since 2005. It’s still a reduction but a dramatic departure from what prior estimates show. Isakower said the new calculations are off and “not an accurate representation of science or reality.” He said the new inventory is undermined by two chief flaws:

“The first is that EPA used new activity data from predominantly larger sources and applied it broadly to all sources, thereby overestimating the number of potential emissions sources in their inventory. Secondly, they used emissions factors that are based on the old data that was developed back in the 1990s. There’s recent measurement data that’s been presented to EPA that shows that many larger sources tend to have lower emissions factors. However, EPA ignored this new data in their new inventory. So they kind of cherry-picked which new data they were going to take and which they were not.”

Isakower continued:

“Essentially in this new inventory, EPA has overestimated the number of potential sources and they’ve also overestimated the rate methane emissions from many of those sources. API identified both of these concerns in our comments to EPA on their draft inventory back in March, but it appears EPA has chosen to ignore them.”

The result is a skewing of reality and a diminished estimate of the benefits generated by America’s energy revolution – for the U.S. economy, our energy security, consumer savings and, yes, the environment.

Industry innovation and leadership have caused emissions to fall, Isakower said, pointing to green-completions technology invented by industry to capture methane, which EPA now requires for all new wells. Since 2000, industry’s investments in zero- and low-carbon technologies have totaled $90 billion, more than twice the next largest industry sector and almost as much as the federal government ($110 billion). Meanwhile, lower-cost energy resulting from surging domestic production has boosted annual U.S. household disposable income $1,200. And, again, the U.S. is leading the world in carbon emissions reductions during a period of economic growth. Isakower:

“[P]roducers have every incentive to capture and sell methane, and we will continue to make substantial progress to reduce emissions voluntarily and under existing EPA regulations. Rather than acknowledging this success and working to ensure market-driven environmental progress continues, this administration is pushing for new government policies that ignore market-based solutions in favor of duplicative regulations that threaten to undermine not only our economy but our success in reducing emissions.”

So now we get to the political component of EPA’s new inventory. Feldman:

“We believe EPA is putting the public posturing right now above science and data. This is out in the court of public opinion, and we have everyone from the president of the United States on down saying we need to be doing more on methane, and we think that ignores the reality that methane emissions are coming down and use of natural gas is driving CO2 emissions reductions in the U.S. That’s making us world leaders in bringing down CO2 emissions. There’s a posturing here that’s inconsistent with the actual benefits that are being provided to the environment and to U.S. consumers.”

Isakower:

“It appears at a time when EPA is looking to justify these costly new regulations on methane from the oil and gas industry, they happen to issue this new methane inventory figures that not only increase the overall emissions estimates, but they also reduce or eliminate the downward trend that we’ve seen in the previous inventories. The timing of all of this seems a little 'convenient.'”

The right path – the one that puts U.S. prosperity and the interests of consumers first – is to sustain and expand what already is working: Safe development of domestic energy that’s also helping the environment. The alternative is a politically driven regulatory rush, a scenario in which the American people lose.

We have a market-based model – API President and CEO Jack Gerard calls it the “U.S. Model” – in which free-market solutions, technological innovation and private investment are carrying the United States forward. Regulation that’s unnecessary and potentially duplicative could hinder the energy revolution and roll back that progress. Isakower:

“We’re calling on the administration to reconsider its flawed emissions estimates.  We’re calling on the administration to put science ahead of politics.  We’re calling on the administration to embrace our proven U.S. model to reduce emissions while helping boost our economy.  We’re calling on the administration to put the interests of consumers first.”


ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.