Minor, Joel, Completing the Bridge to Nowhere: Prioritizing Oil and Gas Emissions Regulations in Western States (June 9, 2014). Available for download at SSRN: http://ssrn.com/abstract=2485890

“America’s energy portfolio is rapidly changing. The hydraulic fracturing boom has spurred domestic oil and gas production, reducing natural gas prices. Natural gas is championed as a “bridge fuel” away from coal and into a low-carbon energy future. Earlier this month, President Obama announced his plan to fight climate change by reducing coal use. President Obama’s plan assumes that burning natural gas is better for the climate than coal. But this assumption is far from certain. Scientists agree that oil and gas production emits significantly more methane, a greenhouse gas much more powerful than carbon dioxide, than previously thought. They remain divided based on the normative question of which timeframe is most relevant for the climate. Natural gas lacks climate benefits over coal in a shorter, twenty-year timeframe, but likely has climate benefits over coal in a longer, 100-year timeframe. Oil and gas methane emissions are thus a major concern. America has stepped onto the natural gas bridge without knowing if it is a bridge to a low-carbon future, or a bridge to nowhere. This paper identifies the most likely regulatory pathway to reduce oil and gas sector methane emissions. EPA already regulates ozone precursor emissions from new and modified oil and gas sector sources, but refuses to regulate the sector’s methane emissions. EPA is unlikely to do so in the future, because regulating methane emissions from new and modified sources would require it to regulate existing sources as well, which would likely be prohibitively controversial and costly. States may adopt their own methane regulations, and Colorado did so in early 2014. But absent a federal requirement, few states are likely to follow Colorado’s lead. But direct regulation is not the only way to reduce the oil and gas sector’s methane emissions. Oil and gas equipment and processes emit a stream of hydrocarbons, including methane, from leaks at various points. Many of those hydrocarbons are regulated as ozone precursors. Regulations reducing their emissions will plug the same holes from which methane also leaks. Unfortunately, EPA’s ozone precursor regulations have many loopholes. Both Colorado and Wyoming continue to violate ozone standards despite having implemented equivalent rules. This led Colorado to adopt stricter regulations in early 2014. Scientific evidence that many other western states are also beginning to exceed EPA’s ozone standard as a result of oil and gas operations. To avoid penalties for exceeding EPA’s ozone limits, these states will soon have to follow Colorado’s lead. Although their regulations will focus on reducing ozone precursors, by doing so they will also reduce methane emissions. Accordingly, state rules to reduce ozone precursor emissions in order to comply with EPA’s ozone standards are the most likely source of regulations to reduce the oil and gas sector’s methane emissions. This article seeks to aid state regulators, environmental advocates, legal academics, and other interested parties in crafting those regulations. It begins by summarizing the statutory and regulatory landscape governing oil and gas sector emissions at the federal, state, and tribal level. Next, it discusses the science behind the oil and gas sector’s hydrocarbon emissions, with a particular emphasis on translating the recent explosion in studies about how the oil and gas sector contributes to ozone formation into a form more digestible to policymakers. Third, it describes the various equipment and processes within the oil and gas sector that emit ozone precursors, and identifies technological solutions that can cost effectively reduce emissions from each type of equipment or process. Finally, it provides recommendations for specific regulations that state policymakers can and should adopt to reduce the oil and gas sector’s ozone precursor emissions.”