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Letters and Comments, Methane Sep 13, 2021

Senate Majority Leader Chuck Schumer
Senate Minority Leader Mitch McConnell
House Speaker Nancy Pelosi
House Minority Leader Kevin McCarthy

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 Section 30114—the Environmental Protection Agency Methane Fee—included in Subtitle A of the House Energy and Commerce Committee’s reconciliation package—the Build Back Better Act. 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.

As we highlighted in our letter dated September 7, 2021, new fees or taxes on energy companies will raise costs for customers, creating a burden that will fall most heavily on lower-income Americans. These major new costs most likely will result in higher bills for natural gas customers, including families, small businesses, and power generators. Over the last week, three variations of the methane tax have been introduced with our analysis showing increases to customer natural gas bills ranging from 12% to 18% to 34%, with the average cost from $85- $242 per year. Without a serious cost-benefit analysis, the impact to the consumer, and more broadly, to the economy and the environment are unknown. We appreciate the efforts to address methane emissions, but the unintended consequences of this tax could prove harmful to families across the country with little environmental benefit.

These outcomes are inconsistent with President Biden’s commitment to pay for reconciliation without imposing new taxes on lower-income Americans. One-third of households already face a challenge in meeting energy needs, according to the Energy Information Administration. In a 2015 survey, 25 million households reported forgoing food and medicine to pay energy bills. According to the Department of Energy’s Low-Income Energy Affordability Data (LEAD) tool, the national average energy burden for low-income households—upwards of 50 million homes— is three times higher than non-low-income households. Furthermore, the energy burden can be as high as 30% of gross household income, depending on location and income. Any increase in low-income households’ energy costs could prove devastating. …

Letters and Comments, Methane Sep 12, 2021

Dear Chairman Pallone and Ranking Member McMorris Rodgers:

Last week, the undersigned organizations wrote to you to oppose the Methane Emissions Reduction Act of 2021, introduced by Senators Whitehouse, Booker, and Schatz in March 2021, and its inclusion in the reconciliation package as a punitive pay-for targeted solely on the oil and natural gas industry that would harm the U.S. economy and cost good-paying American jobs. The good news is that the Build Back Better Act (BBBA) slated for a full committee markup in the Energy and Commerce Committee tomorrow has not adopted the fundamentally flawed Methane Emissions Reduction Act. The bad news is that the BBBA includes a methane fee that is equally problematic.

The Methane Emissions Reduction Act’s default tax on methane was steep at $1,800 per ton. The amount of the BBBA methane tax remains significant at $1,500 per ton. Given natural gas and petroleum together account for nearly 70% of energy consumption in the U.S., new taxes on the industry are likely to have a ripple effect across the U.S. economy – at a time when inflation is already skyrocketing.

The scope of oil and gas facilities subject to the tax is unclear. The legislation instructs EPA to lower the Greenhouse Gas Reporting Program (GHGRP) reporting threshold for oil and gas facilities from the current threshold of 25,000 metric tons of GHGs to 10,000 metric tons of GHGs. The number of facilities and the emission profile of those facilities that fall between the 10,000 and 25,000 metric tons limits are unknown. Additionally, the resulting emission and cost impacts of lowering the reporting threshold cannot be estimated. What is certain, however, is that a substantial number of smaller operators who have never before been subject to EPA’s GHGRP will not only be subject to EPA reporting regulations, but also a new targeted tax. …

Letters and Comments, Methane Sep 8, 2021

Dear Chairman Carper and Ranking Member Capito,

As the Senate develops a reconciliation package, ensuring Americans have access to affordable and reliable energy while continuing to reduce emissions should be top of mind. Unfortunately, the Methane Emissions Reduction Act of 2021, first introduced by Senators Whitehouse, Booker, and Schatz in March 2021 and being considered for inclusion in the reconciliation bill as a payfor, would levy an unreasonable, punitive fee on methane emissions only from oil and natural gas facilities that could jeopardize affordable and reliable energy with likely little reduction in greenhouse gas (GHG) emissions. The bill would tax methane emissions at a default rate of $1,800 per ton in 2023, increasing 5% above inflation annually, with fees for individual companies assessed via a complicated formula based on their share of production or handling (not actual emissions) and the average emissions intensity in the oil and gas basin in which they operate. Alternatively, companies could engage in a likely costly and burdensome process of tracking their own emissions. The bill also includes an import fee which will be levied on each company that imports crude oil, natural gas, or natural gas liquids into the United States. The import fee could likely raise consumer costs, distort markets, and could incentivize retaliatory actions from our trading partners. The bill has never been the subject of a Congressional hearing, and therefore never scrutinized or debated among lawmakers. Congress has never discussed the potential impacts of the methane fee on consumers or the U.S. energy market. …

Letters and Comments, Methane, Taxes Sep 7, 2021

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. …

Letters and Comments Sep 3, 2021

Dear Ms. Christensen and Ms. Jensen:

The Waters Advocacy Coalition (“WAC” or “Coalition”) provides these recommendations in response to the U.S. Environmental Protection Agency’s (“EPA’s”) and the U.S. Army Corps of Engineers’ (“Corps’”) notice soliciting pre-proposal feedback on defining “waters of the United States” (“WOTUS”) under the Clean Water Act (“CWA”).

The Coalition’s members are committed to both building modern, resilient infrastructure and protecting and restoring America’s wetlands and waters and we believe that a clear regulation that draws bright lines between federal and state waters will help further those goals. The Coalition represents a diverse cross-section of the nation’s agriculture, construction, transportation, real estate, mining, manufacturing, forestry, energy, recreational, wildlife conservation, and public health and safety sectors—all of which are vital to a thriving national economy and provide much needed jobs. If the Administration and our nation are to meet our ambitious climate and infrastructure objectives, more must be done to ensure that federal permitting is sustainable and effective, consistent with current statutory authority and legal precedent. We have commented extensively on prior rules, including the Navigable Waters Protection Rule (“NWPR”); the proposal to repeal the 2015 Clean Water Rule (“2015 Rule”);the proposed 2015 Rule; the 2011 Draft Guidance on Identifying Waters Protected by the Clean Water Act; the 2008 Guidance on Clean Water Act Jurisdiction After Rapanos; and the 2003 Advanced Notice of Proposed Rulemaking on the Clean Water Act Definition of “Waters of the United States.” Most of the Coalition’s individual members have also submitted their own comments on these proposals. Through these individual and collective efforts, the Coalition’s members possess a wealth of expertise directly relevant to the Agencies’ efforts to define WOTUS. Our ask has remained steadfast: we need clear rules to protect clean water. …

Endangered Species, Letters and Comments Sep 1, 2021

On Wednesday, September 1, 2021, IPAA submitted comments to the U.S. Fish and Wildlife Services’ (FWS) proposed rules for listing two distinct populations of the Lesser Prairie Chicken (LPC) as threatened with a 4(d) rule and endangered under the Endangered Species Act. IPAA argued against listing the bird as extensive work is ongoing for conservation efforts through the Western Association of Fish and Wildlife Agencies and the use of Candidate Conservation Agreements with Assurances. Furthermore, studies are ongoing about current bird populations that would be useful to the FWS for making an informed decision on listing.

Federal Lands, Letters and Comments, Methane, Regulations, Taxes Aug 31, 2021

Dear Chairman Grijalva:

…

The fight over the reconciliation legislation is one of the most consequential debates the women and men who work in America’s oil and natural gas patch have faced in decades.  The reconciliation package being considered by the House Natural Resources Committee establishes new onerous regulatory requirements and penalties on the industry.  Although the supporters of the bill claim these efforts are focused on environmental protection, this legislation has nothing to do with addressing climate change or protecting the environment.  This legislation has one purpose, to decimate America’s oil and natural gas producers that operate on onshore and offshore federal lands. 

Our nation’s oil and natural gas explorers and producers are committed to protecting the environment, reducing methane emissions and supporting jobs in local communities across the nation.  All of that will be lost if the budget reconciliation package is approved.  IPAA is strongly opposed to the budget reconciliation measure being considered by the Committee and urge all members to oppose this legislation

Letters and Comments, Methane Aug 12, 2021

The following comments are submitted on behalf of the Gas and Oil Association of WV, Inc. (GOWV), the Independent Petroleum Association of America (IPAA) and Texas Independent Producers and Royalty Owners Association (TIPRO). Representatives of GO-WV, IPAA and TIPRO served as Small Entity Representatives (SERs) in the Small Business Advocacy Review Panel Process (SBAR Process) participating in the Pre-Panel Outreach Meeting on June 29, 2021; Panel Outreach Meeting on July 29, 2021 (SBAR Panel), and submitting certain comments after the June meeting. These comments are in response to information provided during both meetings. GO-WV, IPAA, and TIPRO appreciate the opportunity to serve as SERs, hopefully reducing the economic impact of the revisions to Subpart OOOO and/or Subpart OOOOa. A significant number or GO-WV, IPAA and TIPRO members not only qualify as “small entities” under the Regulatory Flexibility Act, but would also be characterized as “mom and pop” or family businesses. It is these smaller businesses that stand to lose the most by the regulations to be proposed at the end of September. …

Summary of Key Points:

• EPA continues to lack emissions data on low production wells to support regulatory decisions – but more data is close at hand.

• Exploring subcategorization of sources is warranted, if not obligated, and perhaps represents the most appropriate means to protect the environment while permitting and supporting small business which support rural communities and our country’s energy independence.

• Don’t “fix” what is not broken/don’t let “perfection” be the enemy of the good: EPA and the oil/gas industry have worked together for at least a decade on New Source Performance Standards (NSPS) focused on volatile organic compounds (VOCs) and/or methane emissions from the industry and progress has been made.

Federal Lands, Letters and Comments Aug 10, 2021

The Independent Petroleum Association of America (“IPAA”) thanks you for this opportunity to submit comments on the Office of Natural Resources Revenue’s (“ONRR’s”) proposal1 to withdraw the ONRR Valuation Reform and Civil Penalty Rule. IPAA is the leading national upstream trade association representing approximately eight thousand independent oil and natural gas producers and service companies across the United States. Independent producers generally include non-integrated oil and gas companies that receive nearly all revenue from production at the wellhead. IPAA’s members operate in 33 states and offshore and employ an average of just 12 people.

One of IPAA’s primary purposes is to advocate for its members’ interests in continued and responsible oil and gas development before Congress and federal agencies and in the judicial system. This purpose includes advocating for rational and fair policies on the valuation of royalties on oil and gas from Federal and Indian leases. …

Letters and Comments Aug 2, 2021

This letter provides comments from the American Fuel & Petrochemical Manufacturers (“AFPM”), the American Petroleum Institute (“API”), the American Exploration and Production Council (“AXPC”), and the Independent Petroleum Association of America (“IPAA”) (collectively, “the Associations”) in response to the U.S. Environmental Protection Agency’s request for comment on reconsidering and revising the Agency’s 2020 Clean Water Act Section 401 Certification Rule1 (“401 Certification Rule”). As explained in more detail below, the 401 Certification Rule provided long-overdue clarification on the role of states and other certifying authorities under Section 401 of the Clean Water Act (“CWA” or “the Act”).

The clarifications furnished in the 401 Certification Rule were also necessary to address some states’ misuse of Section 401 certification procedures in pursuit of policy goals wholly distinct from considerations of potential water quality impacts. Indeed, the 401 Certification Rule was also necessary to incorporate a growing body of case law interpreting Section 401 of the Act consistent with Congress’s intent to preserve for states a highly circumscribed role in evaluating a proposed project’s potential impacts on certain enumerated CWA provisions.

The Associations therefore recommend EPA refrain from altogether setting aside the 401 Certification Rule. If EPA intends to promulgate revisions to portions of the 401 Certification Rule, we urge the Agency to do so in a way that adheres to congressional intent, conforms to relevant current and pending court decisions, and restrains misuse of Section 401 certification procedures. Indeed, as EPA considers revisions to the 401 Certification Rule, we are optimistic that the Agency will recognize that Congress did not intend CWA Section 401 to allow a single state to wield disproportionate power over projects of national importance, and to further recognize that the imposition of reasonable limits on the disproportionate use of Section 401 certification authority is consistent with the principles of cooperative federalism.

IPAA is the industry's strongest presence in the nation's capital and these are important times. The entire oil and gas industry remains under fire from anti-development groups; but with these challenges arise unique opportunities that IPAA is seizing for our members.