This working paper focuses primarily on evaluating and reducing upstream methane emissions in the natural gas sector. We outline a number of state and federal policies and industry best practices to cost-effectively reduce fugitive methane emissions.

Key Findings

  1. Fugitive methane emissions from natural gas systems represent a significant source of global warming pollution in the U.S. Reductions in methane emissions are urgently needed as part of the broader effort to slow the rate of global temperature rise.

  2. Cutting methane leakage rates from natural gas systems to less than 1 percent of total production would ensure that the climate impacts of natural gas are lower than coal or diesel fuel over any time horizon. This goal can be achieved by reducing emissions by one-half to two-thirds below current levels through the widespread use of proven, cost-effective technologies.

  3. Fugitive methane emissions occur at every stage of the natural gas life cycle; however, the total amount of leakage is unclear. More comprehensive and current direct emissions measurements are needed from this regionally diverse and rapidly expanding energy sector.

  4. Recent standards from the Environmental Protection Agency (EPA) will substantially reduce leakage from natural gas systems, but to help slow the rate of global warming and improve air quality, further action by states and EPA should directly address fugitive methane from new and existing wells and equipment.

  5. Federal rules building on existing Clean Air Act (CAA) authorities could provide an appropriate framework for reducing upstream methane emissions. This approach accounts for input by affected industries, while allowing flexibility for states to implement rules according to unique local circumstances.

Executive Summary

While a shift in electric generation to natural gas from coal has played a significant role in recent reductions in U.S. carbon dioxide (CO2) emissions, more will need to be done for the U.S. to meet its goal of reducing GHG emissions by 17 percent below 2005 levels by 2020. A related WRI report found that cost-effective cuts in methane leakage from natural gas systems are among the most important steps the U.S. can take toward meeting that goal. To achieve climate stabilization in the longer term, policies are needed to address combustion emissions through carbon capture and storage or by other means.

In addition to methane emissions, natural gas sector operations and infrastructure represent a significant source of CO2; volatile organic compounds (VOCs), which are chemicals that contribute to ground-level ozone and smog; and hazardous air pollutants (HAPs). In 2012, EPA finalized air pollution standards for VOCs and HAPs from the oil and natural gas sector. These rules will improve air quality and have the co-benefit of reducing methane emissions. As discussed below, these standards can be complemented by additional actions to further reduce methane emissions, which will help to slow the rate of global temperature rise in the coming decades.

Fortunately, most strategies for reducing venting and leaks from U.S. natural gas systems are cost-effective, with payback periods of three years or less. The case for policy action is particularly strong considering that recent research shows that climate change is happening faster than expected. In addition, the projected expansion in domestic oil and natural gas production increases the risk of higher emissions if proper protections are not in place.