AGA-led Natural Gas Industry Letter to Congress on Methane Fees

On behalf of the companies and associations that make up the natural gas supply chain and the 180 million Americans and the 5.5 million businesses that rely on natural gas, we would like to express our concerns about including a methane emissions fee or tax in budget reconciliation legislation. Through numerous programs and initiatives, our companies are at the forefront of reducing greenhouse gas emissions, including methane. Moreover, natural gas is responsible for 61% of cumulative carbon dioxide emissions savings due to changes in the electricity generation fuel mix.

The industry is committed to continuing its efforts to minimize methane emissions across the U.S. economy. However, the methane fee framework currently being considered would introduce a regressive tax on low-income and fixed-income Americans, ignore existing and anticipated federal regulations on methane emissions, and lessen available capital for our companies’ ongoing investments in further reducing methane emissions.

New fees or taxes on energy companies will raise costs for customers, creating a burden that will fall most heavily on lower-income Americans. While we appreciate that the details of the methane fee proposal are still under development, based on similar proposals introduced earlier this Congress, we estimate that the fee could amount to tens of billions of dollars annually. These major new costs most likely will result in higher bills for natural gas customers, including families, small businesses, and power generators. In one scenario, we estimate that such a fee could result in the average customer seeing an approximate increase of 17% in their natural gas bill, or over $100 per year for the average American family. We also estimate that the proposal could put more than 100,000 American jobs at risk. …