Europe Must Lead on Methane, Both Domestically and Internationally

Europe has long been one of the great lions of climate change advocacy. But in the halls of power throughout Europe there’s been a major blind spot: methane.  Thankfully, that is changing. The European Union has set an ambitious goal for carbon neutrality, and Europeans have started to  recognize that this goal can’t be met without addressing methane pollution from the oil and gas sector.

Europe is the world’s largest importer of both oil and gas.  Even under the most aggressive decarbonization scenarios, gas will be part of the European energy system for decades, and as such, Europe must address the methane emissions from any fuels produced or sold in Europe – including emissions from production outside of Europe – or it won’t truly meet its goal of being climate neutral.

Methane packs more than 80 times the heat-trapping power of CO₂, and levels have been rising faster than anticipated under the Paris Climate Agreement, pushing us closer to the precipice of uncontrolled climate feedbacks. If this trend continues, it might prove impossible to meet the agreement’s goals – even with aggressive, bold CO₂ reductions.

Fortunately, reining in methane from the oil and gas industry, the pollutant’s largest industrial source, is feasible and cheap. It can be accomplished through basic equipment maintenance, good operating practices for drilling, transport and storage of oil and natural gas, upgrades to modern equipment, and better compliance planning. According to the International Energy Agency, half of global oil and gas methane emissions can be cut at no cost, and three-quarters can be cut with existing technologies at cost far below most other climate reduction options.

Despite the fact that methane emissions from operations within Europe would make it the seventh largest global emitter of oil and gas methane, methane pollution has not received much attention from the EU – but times are changing.  The EU is due to unveil a methane strategy in May of this year that will hopefully set the EU on a path of becoming a global leader in reducing this powerful pollutant.

But the EU must be more ambitious than the European Commission has indicated in recent briefings on the methane strategy.  In the briefing, the Commission indicated they would be focusing on a “measure first, act later” approach.  This is out of line with the many jurisdictions that have acted to aggressively mitigate methane pollution despite imperfect information about the quantity of emissions.  North American jurisdictions have been moving forward on methane abatement for ~10 years, with success, while research has been ongoing, and debate has continued in academic circles about the exact level of methane emissions.  There is no reason why the EU can’t move immediately to begin addressing methane emissions from its domestic sources and to establish a framework for emissions from imported gas, while collecting better data to improve the understanding of emissions.

No new data is needed to commence Leak Detection and Repair (LDAR) programs, and implementing those programs combined with required reporting on the results of the LDAR inspections will greatly increase the understanding of the emissions inside the EU.  In addition, there are numerous outdated technologies which release gas by design.  There is no reason to measure emissions from this outdated equipment; industry should simply be required to replace it.

Industry in the past has always used the data argument to push back against regulation, but even many in industry have moved beyond this argument.  Companies like Shell, BP, Exxon, ENI, Equinor, Repsol, Total and others have committed to a 0.20% leak rate, mandatory reporting and other measures.

The EU’s “data first” approach will only delay emission reductions that are desperately needed right now; reductions other jurisdictions are on a path to achieve.  In the US, mandatory LDAR is in place at many sites, along with stringent application of best practices to dramatically reduce methane emissions.  Canada has finalized regulations that will cut methane emissions by 40-45% through the use of LDAR, equipment replacement and operational changes.  Mexico has finalized regulations that will cut emissions by as much as 65% through LDAR, equipment replacement and operational changes.  Colombia has committed to cut its methane emissions by 45%.  Nigeria and Cote d’Ivoire have committed to cut methane by 45% by 2025 and 60% to 75% by 2030.  These are the kind of commitments the EU needs to make in its methane strategy in order to become a global leader on this issue.

The European Union has a unique opportunity to leverage their purchasing power as the number one importer of natural gas to drive down emissions in countries that supply gas to the European market.  To do this, the EU must successfully implement best in-class standards for emission reductions throughout the domestic gas industry, from production to distribution.  Implementing these rules domestically will give the EU “clean hands” so it can also use its market leverage to ensure real reductions in methane emissions from production and transport of gas that Europe imports.

Domestic standards are an area of policy development that is well understood with dozens of countries and subnational governments already regulating methane emissions from their domestic gas industry.  This would require:

• Mandatory Leak Detection and Repair – for the entire domestic oil and gas system at least four times a year, recognizing the need to move towards continuous emissions monitoring at many sites, with mandatory reporting of all data from leak surveys.
• Conduct a domestic equipment count and survey of activity data to better inform emission estimates.
• Rapid retrofit / replacement of outdated, dirty equipment: pneumatic equipment driven by natural gas; storage tanks venting hydrocarbons from flash gas and working and breathing losses; compressors venting gas from seals; etc.
• Strict standards to eliminate venting and flaring from oil wells and gas wells (including during well maintenance, water unloading, and drilling and completion) for domestic sources.

But the EU needs to be more ambitious than simply reducing the pollution from operations within Europe’s borders.  As the world’s largest importer of oil and gas, the EU wields enormous purchasing power.  The EU must use that power and the methane strategy as a platform to pressure and incentivize methane reductions from the EU’s major gas suppliers: Russia, Norway, Algeria, Qatar, and others.

To achieve this, the EU would need to develop pricing mechanisms or other policy options, along with third-party verification systems to ensure compliance and would need a stringent system for monitoring for compliance, reporting of emissions, and verification of data for both domestic sources as well as supplier countries.

By 2030, these standards could reduce several million tons of methane emitted annually, reducing near-term warming more than would be accomplished by shutting down all the coal fired power plants in Germany and Spain combined. 

If Europe can implement these ambitious standards, it will move back to the head of the pride on climate and send a clear signal to the world that methane emissions must be dramatically cut as a key part of becoming climate neutral.