September 2022, Vol. 249, No. 9


Newest EPA Methane Proposal Hits Pipelines Hard

(P&GJ) — The Senate bill on climate change, which includes a new fee on pipeline emissions of methane, puts a new emphasis on the Environmental Protection Agency’s (EPA) two rulemakings on greenhouse gas emissions (GHG).

If the new methane fee passes Congress, and that is not certain, it would probably be tied to interstate pipeline compliance with the two rulemakings, one from 2021, which imposes new methane controls, and the newest one from June 2022, which imposes new recordkeeping and reporting requirements.   

EPA’s proposed GHG emissions reporting rule came out in June quietly and without fanfare. That proposal would drastically increase natural gas sector measuring, calculation and reporting requirements for methane. It also undoubtedly would serve as a stimulus for emissions reductions of methane from compressors. Natural gas groups immediately complained about the initial two-month comment period, so EPA extended it to Oct. 6.  

The GHG reporting rule was initially established in 2009, but the Biden EPA wants to make significant, prescriptive methane emissions calculation changes. These changes heavily impose on a single industry – natural gas – which is covered in the 2009 rule, Subpart W (Petroleum and Natural Gas Systems), which includes onshore petroleum and natural gas production; onshore petroleum and natural gas gathering and boosting; natural gas distribution; and onshore natural gas transmission pipeline.    

The Biden EPA’s decision to “improve” – in its words – the 12-year-old GHG rule will allow it to “incorporate new data or updated scientific knowledge; reflect new emissions sources; improve analysis and verification of collected data; provide additional data to complement or inform other EPA programs; or streamline calculation, monitoring, or reporting to provide flexibility or increase the efficiency of data collection.”  

EPA’s cost estimates show that sources subject to Subpart W will bear 82% of incremental burden associated with the proposed rule. That equates to an annual cost, almost exclusively for administrative labor costs, of $1.2 million per year, according to EPA. The proposed rule affects over 2,300 Subpart W reporters and reflects 504 new data elements and 153 revised data elements.  

Regarding interstate pipelines, the proposal contemplates numerous, potentially onerous new requirements on compressor emissions. Interstate Natural Gas Association of American (INGAA) member companies operate more than 5,400 natural gas compressors at over 1,300 compressor stations and storage facilities.   

When Scott Yager, vice president, Environment, INGAA, wrote to EPA asking for an extension of the initial 60-day comment deadline, he argued some of the proposed emissions factors have increased by 150% to 400%. He termed those increases “enormous.”  

Making matters worse for pipelines is the fact this new proposed rule cites in places a second proposed rule issued by the Biden EPA in November 2021. That is “Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review” (otherwise known as the “OOOOb” proposal).   

That proposed rule would require emissions guidelines for state implementation that would apply a 95% volatile organic compound (VOC) and methane reduction requirement from centrifugal wet seals to all existing sources as of Nov. 15, 2021. That proposal has not been finalized.  

That proposed rule, too, has major implications for compressor emissions of methane. Michael J. Pitta, vice president, Kinder Morgan, whose pipelines account for about 40% of the natural gas used by consumers in the U.S., told EPA, despite the company’s substantial experience with wet seals, it, like many of its peers, has no experience capturing or controlling emissions from wet seals by 95%. Kinder Morgan has consistently installed only dry seals on its centrifugal compressors.  

Dry vs. wet seals also come into play in the new proposed requirements for GHG reporting, which is detailed, technical and covers centrifugal and reciprocating compressors. The June 2022 proposal adds dry seal vents to the defined compressor sources for centrifugal compressors and requires measurement of volumetric emissions from the dry seal vents.   

Another change would require measurement of volumetric emissions from the wet seal oil degassing vent and volumetric emissions from blowdown valve leakage through the blowdown vent when the compressor is found in standby pressurized mode. Rod packing emissions for reciprocating compressors would have to be measured when found in the standby pressurized mode.  

To get an idea of how truly technical the proposed June rule is, EPA says it wants to address uncombusted methane emissions from compressor drivers by requiring pipelines to “to use the CH4 emission factors in Table W-9 to Subpart W rather than the default CH4 emission factor for natural gas in Table C-2 to Subpart C.”   

And, if that were not technical enough, EPA goes on to say, “the default CH4 emission factor for natural gas may only be used for natural gas-fired combustion units that are not compressor drivers.”

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