New Jobs Bill Has Infrastructure Funding Provision; pipeline safety issues crop up; GHG reporting

May 2010 Vol. 65 No. 5

Monitoring of all sources included in the rule would have to start on Jan. 1, 2011. The EPA proposed rule will only require reporting of methane sources at compression stations emitting more than 25,000 metric tons a year of CO2 equivalent. That would subject 1,145 transmission facilities, or 59 percent of the total, to monitoring and reporting requirements. The supplemental rule also covers onshore petroleum and natural gas production, offshore petroleum and natural gas production, natural gas processing, natural gas transmission compressor stations, underground natural gas storage, liquefied natural gas (LNG) storage, LNG import and export terminals and distribution. EPA is not proposing to include reporting of fugitive emissions from natural gas pipeline segments between compressor stations.

The EPA has not announced at what point GHG emitters will have to add GHG emissions to other Clean Air Act-controlled emissions for the purpose of determining whether those total emissions require the company to obtain an operating permit which would include limits on methane emissions. Presumably those permit requirements would not come into play for the gas transmission industry until at least after March 2012 when the first monitoring reports are due.

“Gathering this information is the first step toward reducing greenhouse emissions and fostering innovative technologies for the clean energy future,” says EPA Administrator Lisa P. Jackson. “It’s especially important to track potent gases like methane, which traps more than 20 times as much heat as carbon and accelerates climate change. Once we know where we must act, American innovators and entrepreneurs can develop new technologies to protect our atmosphere and fight climate change.”

EPA estimates that the total cost for monitoring emissions in the first year is $56.0 million, and the total national annualized cost for subsequent years is $21.4 million. Of these costs, roughly 49.5 percent fall upon the onshore production segment in the first year, while 34.5 percent fall upon the gas transmission segment. Local distribution companies account for 3 percent.