Headlines: EPA Takes Aim At Obama-Era Methane Rule
The Trump administration took another step toward rolling back an Obama-era policy regulating how natural gas drillers handle methane. The Environmental Protection Agency (EPA) said Sept. 11 the proposed changes will save the industry $75 million a year in regulatory costs between 2019 and 2025. Under the new proposal, methane gas emissions will increase by a total of 380,000 short tons between 2019 and 2025 compared with the EPA’s 2018 baseline estimate. In a statement, acting EPA Administrator Andrew Wheeler said, “These common-sense reforms will alleviate unnecessary and duplicative red tape and give the energy sector the regulatory certainty it needs to continue providing affordable and reliable energy to the American people.”
One person who definitely doesn’t approve of the EPA’s action is California Gov. Jerry Brown, who called the rule reversal “insane.” A day earlier, Brown signed a bill requiring California to source electricity from exclusively carbon-free sources by 2045, a move aimed at combating the Trump administration’s fossil fuel policies. The law makes California the largest global economy to officially aim for 100% carbon-free energy. Hawaii is the only other U.S. state to set a similar goal. Pacific Gas & Electric said California’s law could raise customer bills and make the grid less reliable. If it's not affordable, it's not sustainable, the utility’s spokeswoman, Lynsey Paulo, told Reuters.
Meanwhile, U.S. dry natural gas production should rise to an all-time high of 80.9 billion cubic feet per day (Bcf/d) in 2018, according to the Energy Information Administration’s (EIA) Short-Term Energy Outlook released this week. The latest September output projection for 2018 was down from the EIA’s forecast in August but would still easily top the current annual record high of 74.1 Bcf/d produced on average in 2015. The EIA also projected U.S. gas consumption would rise to an all-time high of 79.8 Bcf/d in 2018.
Finally, we’re keeping an eye on Hurricane Florence as it batters the U.S. southeast coast and tropical storms in the Gulf of Mexico. We’ll have updates on how the storms affect oil and gas production, demand and prices on Hart Energy’s family of websites.