09/27/2019 - Regulatory Tracker

EPA VOC and Methane Standards for Oil and Gas Facilities

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Why it Matters

Methane, a powerful greenhouse gas, is a significant component of natural gas. It is released from oil and gas production, processing, transmission, and storage through equipment leaks, venting, and flaring. Recent studies have found that the sector releases much more methane than previously reported, well over the amount that EPA’s GHG data indicates.

During the Obama administration, EPA set standards for volatile organic compounds (VOCs) and methane emissions for new oil and gas production sources (which included production, processing, transmission, and storage). This was the first rule expressly targeting methane emissions. EPA also issued Control Technique Guidelines to states with moderate nonattainment areas for ozone, requiring them to amend their State Implementation Plans (SIPs) to address VOCs from existing sources via a set of controls that would also reduce methane emissions. EPA also began preparing to tackle methane emissions from existing sources by issuing an information collection request asking for data and information about how to reduce methane pollution from existing oil and gas sources.

The Trump Administration revoked nearly all of these actions, leaving in place only some of the standards controlling VOCs in new sources. It entirely eliminated methane standards for all segments of the oil and gas industry and left in place some VOC standards only for production and processing facilities. It also rolled back the efforts to develop a rule covering existing sources, having eliminated the legal predicate for doing so. The Trump-EPA’s rollback of standards for new sources was completed through two rulemakings in September 2020, the Policy Rule and the Technical Rule. (For more information, see our detailed analysis of the final Trump-era rules rescinding methane emissions standards: EPA’s Final Methane Emissions Rules Roll Back Standards and Statutory Authority; and a piece by Ari Sillman, JD 2021, Weighing the Risks of Using the CRA to Restore EPA’s Methane Standards.)

The Biden administration and Congress have taken steps to reinstate the Obama era methane standards for new oil and gas sources, as well as proposing new rules that are broader in scope and stringency for new and existing sources.

Current Status

On Jan. 20, 2021 President Biden signed Executive Order (EO) 13990 instructing the EPA to consider suspending, revising or rescinding the 2020 Policy Rule and to propose a rule for existing sources by September 2021. On June 30th, President Biden signed a Congressional Review Act resolution passed by Congress that revoked the 2020 Policy Rule. EPA published its proposed new performance standards and emissions guidelines for new and existing oil and gas facilities on November 15, 2021. The US also jointly announced a methane reduction pledge with the EU in September 2021, ahead of COP26.

See our recent analysis of EPA’s proposal here and our podcast discussing the proposal here.

Timeline of Events

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Aug. 16, 2012 EPA finalizes New Source Performance Standards (NSPS) for VOC emissions (volatile organic compounds) from new wells and other oil and gas equipment. This rule reduces methane emissions indirectly and does not apply to existing oil wells, which also release VOCs and methane.

Sept. 23, 2013 and Dec. 31, 2014 EPA publishes amendments to the Aug. 16, 2012 NSPS amending and clarifying certain issues related to well completions and storage vessels, among others, and making technical corrections. 78 FR 58416 and 79 FR 79018.

June 3, 2016 EPA finalizes New Source Performance Standards (NSPS) for VOC and methane emissions from the oil and gas sector. Additional sources are covered under this rule. Notably, this rule triggers the obligation to regulate methane from existing wells and equipment.

Aug. 2, 2016 Industry petitions EPA to reconsider the methane rule.

Oct. 27, 2016 EPA publishes final “Control Techniques Guidelines for the Oil and Natural Gas Industry.” The document provides states with moderate ozone nonattainment areas information to help them determine reasonably available control technology (RACT) for VOC emissions. Publishing the guidelines in effect directs these states to amend their State Implementation Plans (SIPs) to address VOCs from existing sources via a set of controls that would reduce methane emissions occurring at those sources using RACT.

Nov. 10, 2016 EPA issues an Information Collection Request (ICR) to operators, asking them to identify ways to control methane from existing oil and gas sources; covered facilities and processes including “onshore production, gathering and boosting, gas processing, transmission, storage, and liquefied natural gas (LNG) import/export.” This is the agency’s first step towards regulating existing oil and gas infrastructure for methane leaks, venting, and flaring.

Jan. 5, 2017 The D.C. Circuit consolidates several challenges to EPA’s rule. American Petroleum Institute v. EPA, Case No. 13-1108 (D.C. Cir.).

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March 1, 2017 Eleven states write Administrator Pruitt asking him to cancel the ICR for existing oil and gas sources issued in November 2016 because it is too burdensome for industry.

March 2, 2017 EPA cancels the ICR.

March 28, 2017 President Trump issues the Executive Order on Promoting Energy Independence and Economic Growth, directing EPA to reconsider this rule (and many others).

April 4, 2017 EPA announces it is initiating a review of the 2016 NSPS in light of President Trump’s Executive Order to determine if it needs to initiate additional rulemaking proceedings. 82 FR 16332.

April 7, 2017 EPA moves to suspend the case while it reconsiders the rule.

April 18, 2017 Administrator Pruitt sends a letter to industry, informing them EPA will reconsider at least two parts of the 2016 methane rule: a provision for states to request permission to set alternative emission limits and treatment of low production wells.

May 18, 2017 The D.C. Circuit suspends the case and directs EPA to submit 60-day status reports.

June 5, 2017 EPA publishes a formal grant of reconsideration. EPA will reconsider four provisions: the two provisions referenced in the April 18, 2017 letter, and two professional engineer certification requirements. EPA delays key provisions of the rule, notably the leak detection and repair (LDAR) requirements, for three months.

June 5, 2017 Environmental groups challenge the reconsideration and delayClean Air Council et al. v. Pruitt, Case No. 17-1145 (D.C. Cir.).

June 16, 2017 EPA proposes to delay key provisions of the methane rule for two years, acknowledging “associated climate and human health benefits” will be foregone as a result. The D.C. Circuit vacates EPA’s three-month delay of the methane rule on July 3, 2017.

June 29, 2017 States send EPA a notice of intent to sue over its failure to establish guidelines for standards of performance for methane emissions from existing oil and natural gas sources.

July 7, 2017 EPA asks the court not to require the agency to carry out the rule, at least until EPA can decide whether to ask the full D.C. Circuit to reconsider, or appeal to the Supreme Court.

July 13, 2017 The D.C. Circuit grants a limited stay of 14 days but notes that to delay the rule further “would hand the agency, in all practical effect, the very delay in implementation this panel determined was ‘arbitrary, capricious, [and] … in excess of [EPA’s] statutory … authority’.”

July 31, 2017 Environmental groups ask the court to reissue its mandate and direct EPA to implement all provisions of the 2016 rule. The D.C. Circuit rules EPA must enforce the methane rule.

Aug. 28, 2017 Multiple environmental groups announce they will sue EPA over its failure to regulate methane emissions from existing oil and gas infrastructure. (Recall from the History section: once a final rule for new sources of methane is issued, EPA may be obligated to set methane standards for existing sources. This could control methane pollution from all existing oil and gas production and transport operations in the United States.)

Oct. 31, 2017 The first round of compliance reports from regulated sites is due to EPA. Environmental groups file FOIA requests to obtain the reports but EPA does not respond.

Nov. 8, 2017 EPA issues two Notices of Data Availability to justify the proposed compliance delay of the rule and to solicit comments on certain proposed substantive changes. The Notices provides new information on EPA’s authority to stay the rule and on “technological, resource, and economic challenges with implementing fugitive emissions requirements…,” as well as an updated cost-benefit analysis of delaying the rule.  EPA takes comments on the Notices until December 8, 2017, leaving the rule in effect for at least another 30 days, pending EPA publishing a final rule.

March 9, 2018 EPA publishes a notice of proposed withdrawal of Control Techniques Guidance issued on October 27, 2016, which had provided recommendations for reducing VOCs from existing oil and gas sources that relied on data and conclusions made in the June 3, 2016 NSPS rule. Comments on the proposal are accepted until April 23, 2018.

March 12, 2018 EPA publishes a final amendment to the 2016 NSPS rule that allows leaks to go unrepaired during unscheduled or emergency shutdowns, saying repairing them could lead to service disruptions.

April 5, 2018 Fourteen states, the District of Columbia, and the City of Chicago sue EPA for its failure to regulate emissions from existing oil and gas operations. The suit, brought in the US District Court for the District of Columbia, argues that the Agency violated the Clean Air Act by unreasonably delaying the fulfillment of its mandatory obligation to issue guidelines for controlling methane emissions from existing oil and gas sources, which the Clean Air Act obligates it to do now that performance standards for new oil and gas sources have been established. NY v. Wheeler, 1:18-cv-00773 (D.D.C.).

May 29, 2018 The US District Court for the District of Columbia grants Environmental Defense Fund’s unopposed May 25, 2018 motion to intervene on behalf of the state plaintiffs.

Sept. 10, 2018 EPA announces the release of proposed revisions to the oil and gas NSPS issued in 2016. EPA initiated its review of the 2016 NSPS in April 2018. A 60-day public comment period will commence once it is published in the Federal Register. The proposal loosens requirements imposed by the Obama-era rule regarding fugitive emissions at new sources, including inspection and repair timeframes, standards, and certification requirements.

Oct. 15, 2018 EPA published its proposed rule to revise the 2016 oil and gas NSPS. The proposal responds to petitions for reconsideration of the 2016 rule. Submit comments on the proposal here by December 17, 2018.

Nov. 14, 2018 EPA held a public hearing in Denver on its newly proposed NSPS rule.

Aug.29, 2019 EPA releases a proposal to rollback methane regulations finalized in 2016. The proposal rescinds emissions limits for methane on oil and gas production and processing. EPA also includes a proposal to remove transmission and storage from regulation altogether and requests comment on alternative interpretations of EPA’s legal authority to regulate pollutants under section 111(b)(1)(A) of the Clean Air Act. Once published in the federal register, it will be available for public comment for 60 days. A number of larger energy companies urged the administration not to rescind the regulations while smaller operators who have not yet significantly invested in methane reduction are supportive of rescission. This proposal is in addition to the smaller adjustments proposed in Oct. 2018.

Sept. 24, 2019 EPA publishes its proposed rollback of methane regulations in the federal register, opening the comment period. The rule proposes revisions to both the 2012 and 2016 VOC and methane standards for oil and gas facilities. EPA is accepting public comments through Nov. 25, 2019 (but comments on the information collection provision should be submitted by Oct. 24, 2019 for consideration by OMB). EPA has also announced a public hearing on Oct. 17, 2019 in Dallas, TX.

July 6, 2020 Plaintiffs in the unreasonable delay lawsuit filed against EPA on April 5, 2018 file a motion to compel EPA to move forward with regulating methane emissions from existing oil and natural gas operations under CAA Section 111(d). NY v. Wheeler, 1:18-cv-00773 (D.D.C.).

August 13, 2020 The EPA released its final rescission and revision of the 2012 and 2016 VOC and methane standards for oil and gas facilities. The two actions, referred to as the Reconsideration Rule and Review Rule, fully rescind VOC and methane standards for transmission and storage and methane standards for all segments, effective once published in the federal register, and revise standards for VOC emissions in the production and processing segments, effective sixty days after it is published in the federal register. The rule breaks with decades of EPA interpretation of the Clean Air Act to take a stance that could limit the ability of EPA to regulate GHG emissions from any source.

Sep. 14, 2020 EPA publishes the Review Rule in the Federal Register, immediately removing regulatory requirements for the transmission and storage segments of the oil and gas industry.

Sep. 14, 2020 A coalition of 24 states and municipalities filed suit to challenge EPA’s Review Rule, arguing it violates the Clean Air Act. The coalition notes it intends to challenge the Reconsideration Rule as well. CA v. Wheeler, 20-1357 (DC Cir.).

Sep. 15, 2020 EPA publishes the Reconsideration Rule in the Federal Register. It will go into effect on November 16th, 60 days after publication.

Sep. 14-15, 2020 A coalition of environmental groups sue EPA over the two methane rules, filing petitions for review with the DC Circuit challenging both the Review Rule and the Reconsideration Rule. Consolidated under Environmental Defense Fund, et al v. Andrew Wheeler, et al, Docket No. 20-01359 (D.C. Cir.).

Sep. 17, 2020 The D.C. Circuit issued an administrative stay for the Review Rule, preventing it from going into effect immediately as intended, pending its consideration of an emergency motion for stay in the litigation filed by environmental groups against the two rules. EDF v. Wheeler, 20-01359 (D.C. Cir.).

Oct. 27, 2020 The D.C. Circuit decides not to stay the Review Rule while it considers litigation challenging the rule, dissolving its earlier administrative stay that prevented the rule from going into effect immediately. EDF v. Wheeler, 20-01359 (D.C. Cir.).

Nov. 13, 2020 A coalition of environmental organizations argues in the D.C. Circuit for review of the Reconsideration Rule. This challenge asked the D.C. Circuit to block EPA’s reduction in leak monitoring frequency. EDF v. Wheeler, No. 20-1360 (D.C. Circuit).

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Jan. 20, 2021 President Biden signs EO 13990 that specifically instructs the EPA to consider suspending, revising or rescinding the Trump era rule for new sources by May, 2021. It also instructs the agency to propose a rule for existing sources by September, 2021.

Feb. 1, 2021 The EPA files motions to hold the case challenging the Trump era methane rules in abeyance.  CA v. Wheeler, 20-1357 (DC Cir.); EDF v. Wheeler, 20-01359 (D.C. Cir.).

Feb. 5, 2021 The EPA files additional motions to hold cases in abeyance for case numbers 20-1360, 20-1364, 20-1367 in the D.C. Circuit.

Feb. 12, 2021 The D.C. Circuit agrees to hold the case brought by states and cities in abeyance and requires EPA to file status reports every 120 days beginning June 14, 2021. California v. Wheeler, No. 20-1357 (D.C. Cir.).

March 25, 2021 Congressional Democrats announce they will propose a resolution of disapproval under the Congressional Review Act for the Review Rule. This would nullify the rule that cut transportation and storage facilities and determined methane was duplicative for the remaining facilities but leave the Reconsideration Rule’s technical amendments on well completions, pneumatic pumps, storage vessels, fugitive emissions, inspections, etc. to the EPA to address through new rulemaking.

April 26, 2021 The U.S. Senate passed the Congressional Review Act resolution disapproving of the Review Rule, sending it to the House.

May 14, 2021 EPA opened a non-rulemaking docket for public input on reducing emissions of methane and other air pollutants from new and existing sources in the oil and natural gas sector. The comment period closes July 30, 2021. EPA stated that the goal of this public comment period and its other public engagement efforts “is to gather perspectives from a broad group of stakeholders for the oil and natural gas sector, including individuals and communities that experience disproportionate adverse health and environmental impacts as a result of
oil and natural gas operations.”

June 25, 2021 The U.S. House voted for a Congressional Resolution Act resolution to revoke the Review Rule, sending the resolution to the President’s desk for signature.

June 30, 2021 President Biden signs the CRA resolution revoking the Trump-era Review Rule.

Sep. 13, 2021 OMB receives EPA’s proposed new source rule for interagency review, the last step before it is published in the federal register. EPA’s proposed rule, titled “New Source Performance Standards for Crude Oil and Natural Gas Facilities: Review of Policy and Technical Rules,” is intended to fulfill the directives in President Biden’s EO 13990 for review and possible revision of the 2020 rules by September 2021.

Sep. 15, 2021 OMB receives EPA’s proposed emissions guidelines for methane emissions from existing oil and gas sources. In EO 13990, President Biden directed EPA to consider proposing a rule by September 2021. The new emissions guidelines and NSPS are not expected to be published in the Federal Register until October.

Sep. 18, 2021 The US and EU jointly announce a pledge to reduce global methane emissions by at least 30 percent from 2020 levels by 2030. The announcement is also an invitation to other countries to join. By Oct. 11, 2021, thirty-two countries had joined.

Nov. 2, 2021 EPA proposed new performance standards and emissions guidelines for new and existing oil and gas facilities. The proposed rule revises performance standards for new and modified oil and gas facilities and includes for the first time, emission guidelines for existing sources. EPA also made clear that it intends to release a supplemental rulemaking based on additional comments from stakeholders and will finalize the regulations  by the end of 2022. EPA published the proposed rule in the Federal Register on November 15, 2021 and comments are due on January 31, 2022.

Dec. 22, 2021 Sixteen Democratic members of Congress write a letter to EPA asking for the final rule to include more rigorous restrictions on flaring and for inspection requirements for smaller well sites. 

Jan. 31, 2022 On the last day for comments, 20 GOP lawmakers write a letter to EPA calling for an additional extension of the comment period and criticizing the proposed rule as “devoid of rule text.”

Additional EELP Analysis: