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API, US energy groups unite against proposed methane fee rule

The American Petroleum Institute (API) joined 19 other associations representing all segments of the US oil and natural gas industry in calling on the US Environmental Protection Agency (EPA) to revise its proposed methane fee on American energy.

In comments submitted to the agency on the “waste emissions charge” proposed rulemaking, the associations argued that the EPA’s proposed rule creates an incoherent regulatory regime, fails to meet the statutory requirements outlined by the Inflation Reduction Act and disincentivizes emissions reduction efforts by the industry.

“This tax on American energy is a serious misstep that could jeopardize our nation’s energy advantage and weaken our energy security,” said API Senior VP of Policy, Economics and Regulatory Affairs Dustin Meyer. “US oil and natural gas is innovating throughout its operations to reduce methane emissions while meeting growing energy demand. Yet this proposal creates an incoherent, confusing regulatory regime that will only stifle technology advancements and hamper energy development. With partners across the industry, we will consider all options to ensure a smart regulatory framework for continued American energy development.”

In the comment letter, the associations raised concerns about the proposed rule’s nexus to other methane regulations underway, highlighting the Biden administration’s disharmonized approach to methane regulations. The associations urged the administration to coordinate this proposed rule with other regulations, including Subpart W and the EPA’s final Methane Rule. Additionally, they called for more flexibility on netting requirements to incentivize greater emissions reductions, clarification of the rule’s exemptions as intended by Congress and commonsense compliance and reporting timelines.

The industry is taking action to reduce methane emissions while continuing to produce affordable, reliable energy. Average methane emissions intensity declined by nearly 66% across all seven major producing regions from 2011 to 2021. Industry-led initiatives like The Environmental Partnership, whose members make up nearly 70% of US onshore natural gas and oil production, are helping to accelerate progress on methane emissions reductions by driving collaboration and sharing best practices.

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