EPA Chief Plays Defense on Methane Regs and Keystone

Administrator walks back her earlier pipeline comments and says EPA needs to learn from industry how to better regulate methane.

EPA chief Gina McCarthy, shown here, recently outlined the agency's priorities for the year, many of them related to climate change. (Credit: Chesapeake Bay Program/Flickr)

The Obama administration's new plan for reducing the oil and gas industry's methane emissions will drive down releases of the potent greenhouse gas despite a heavy reliance on voluntary measures, the chief of the Environmental Protection Agency said.

Gina McCarthy, the EPA administrator since 2013, defended the plan, issued this week, against criticism by environmentalists that it is too cautious because regulations would apply only to new oil and gas sources. The industry argues that the new rules aren't needed because methane emissions have already been declining.

"We're not letting go," McCarthy said in a wide-ranging discussion Friday with reporters. In addition to regulating new sources of methane emissions, the agency plans to push voluntary efforts for existing units, nearly halving the industry's emissions by 2025. "You will see those emissions from existing facilities continue to decrease as a result," she said.

The EPA chief also outlined the agency's priorities for this year, many of them related to climate change. She said the agency delayed issuing a final rule to reduce greenhouse gases from new power plants until this summer so that it would come out with a final rule for existing power plants, as the two regulations are intertwined. The administration is also working to develop the next phase of fuel economy standards for heavy trucks, she said.

Keystone XL Timeline

In addition, McCarthy said the EPA was preparing to move ahead with its input to the approval process for the controversial Keystone XL pipeline. The Obama administration suspended the federal process last spring when a Nebraska court invalidated the pipeline's route though the state. But a week ago, the Nebraska Supreme Court overturned the lower court ruling and reinstated the route.

The EPA is awaiting a "guidance document" from the State Department to resume a National Interest Determination, McCarthy said. That finding is the last analytical step in the process before President Barack Obama makes a final decision on the $5.3 billion pipeline from Alberta to Steele City, Neb.

The EPA also plans to submit comments on the State Department's final environmental impact statement in the next two weeks or so, McCarthy said. That analysis also was shelved pending the Nebraska court ruling. McCarthy said she didn't know how the EPA would weigh in on the environmental impact statement or the national interest determination because she hadn't discussed them yet with the agency staff.

In the protracted permitting history of Keystone XL, the EPA has been highly critical of the State Department's environmental analyses for failing to account adequately for higher greenhouse gas emissions associated with tar sands development. The State Department's environmental impact statement issued in January 2014 concluded that Keystone XL project would have minimal impact on greenhouse gas emissions.

McCarthy herself appeared to side with backers of the pipeline in a November 2013 interview with The Boston Globe. Keystone XL proponents contend it would have little impact on Alberta's tar sands and the greenhouse gases generated from their development because the oil there would still be produced and transported another way. "If there's oil there, someone will find it and use it," she said, according to the Globe.

Her comments at the time seemed to align with the Obama administration's posture. But in more recent comments, Obama has hinted skepticism about the Keystone XL pipeline, maintaining that the project would provide few benefits for the U.S. On Friday, McCarthy walked back her earlier comments, too, suggesting they had been misunderstood.

"I don't think I made that judgment; I'm sure I did not," she said of tar sands development. "What we were commenting on was the fact that we needed to look at that issue effectively and that we provided the Department of State with very specific comments on the analytics around that."

Methane Plan Defense

Questioned repeatedly about the methane plan, McCarthy said the rules for new sources of methane from oil and gas would "send a signal" to the industry about the kinds of improvements it needs to make on existing facilities. If the industry delivers substantial cuts on a voluntary basis, there might not be a need for rules for existing sites, she said.

Environmentalists argue that voluntary efforts have historically produced weak results from industry, and that the current reduction in emissions has been driven by a rule to cut volatile organic compounds, of which the decrease in methane emissions is a side benefit.

The existing landscape of oil and gas sites is too complex for the EPA to tackle with methane rules out of the gate, McCarthy said, citing 100,000 facilities in different oil and gas basins with different technologies. Seeing what the industry does with new sites will give the EPA a sense of possible changes it can pursue with existing ones, she said. 

"We did not decide to defer regulating the existing [sites] just to give time to industry," she said. "We expect the rules we are making now we will learn from. We did this to be deliberate and effective."

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