Obama Turns His Regulatory Pen on Methane

In his last months in office, Barack Obama continues to issue regulations that cripple the energy sector.  Far from being a champion of the poor and the middle class, Obama is destroying jobs, raising energy costs, and making the U.S. vulnerable to foreign control.  The latest regulations on methane, announced on March 10 in a joint news conference with Canadian prime minister Justin Trudeau, are a perfect example of why the U.S. economy has been expanding at a snail's pace since 2008.

The EPA action announced Thursday would reduce methane emissions from existing oil and gas wells by up to 45% from 2012 levels by 2025.  Additional regulations would apply to new drilling and to drilling on federal lands.  Since hundreds of thousands of wells exist in the U.S., the methane regulations would impose a significant burden on the industry. 

Alongside the EPA actions, the Bureau of Land Management announced its own slew of methane regulations for federal and tribal lands. The new BLM rules would duplicate regulations that already require drillers to eliminate flaring of gas emissions.  The new rules would amount to a "paperwork and compliance nightmare for many small businesses," according to Congressman Kevin Cramer of North Dakota.  As Cramer put it, "[t]hese regulations have nothing to do with protecting the environment and everything to do with shutting down the oil and gas industry in our country."

At a time when oil prices are low, any regulation that makes U.S. drilling less competitive is a bad idea.  The cost of oil and gas production in the U.S. is already several times that of production in Saudi Arabia, Russia, and other oil-rich countries.  Obama's underlying agenda seems to be to weaken the U.S. energy industry relative to low-cost foreign producers.  By doing so, U.S. producers will be driven into bankruptcy, and eventually oil and gas prices will rise, making solar and wind appear more competitive.

By driving oil and gas drilling overseas, Obama's methane order would cost Americans thousands of high-paying jobs.  Middle East producers are eager to increase their market share.  Obama's methane regulations will make that happen.

Obama's methane order reflects the left's bias against fossil fuels.  A rational policy, if one believed that methane emissions were contributing significantly to climate change, would be to target all sources of methane emissions.  Obama's focus has been on the oil and gas industry – this despite the fact that oil and gas production is responsible for less than one half of one percent of total greenhouse emissions.

In fact, increased reliance on natural gas by U.S. utilities, homeowners, and industry has contributed more to reductions in overall greenhouse emissions than any other factor.  Natural gas produces half the carbon emissions of coal.  Those who believe that carbon emissions contribute to global warming (and that warming is a bad thing) should be applauding the increased use of natural gas in the U.S. economy.  Unfortunately, environmental extremists are determined to undermine reliance on all fossil fuels, regardless of efficiency, safety, and cost.

Methane release from oil and gas drilling is actually 20% less than that from agricultural sources.  So where are the new EPA regulations for agriculture?  So far, the EPA has focused on fossil fuels.  (Not that the agricultural sector should rest easy – left unchecked, the environmental left will bring every American industry to its knees.)

As it is, the oil and gas industry has already slashed methane emissions from new wells, cutting emissions from fracked wells by 79%.  Methane emissions from gas production overall is down by 38% since 2005.  Continued efforts by the industry, driven by the economic incentive of capturing 100% of gas produced at the wellhead, would be enough to solve the perceived problem.  It seems that what Obama wants is not a solution, but the demise of this important sector of the economy.

According to the American Petroleum Institute, the new methane regulations are duplicative, costly, and unnecessary.  A host of regulations already exist at the state and federal level limiting methane emissions from drilling and distribution of oil and natural gas.  Additional rules, combined with an arbitrary benchmark of 45%, arrived at without significant input from the private sector, is not the right way to proceed.

The new rules reflect the arrogance of an administration cut off from the people it purportedly serves.  Obama is eager to secure his legacy before leaving office, but that legacy will be decades of economic hardship, especially for the poorest quartile of earners for whom energy constitutes a larger share of living costs.

Clearly, the Democratic Party has become the party of the rich.  It is not by accident that wages for the American middle class have stagnated over the past eight years.  Obama's regulatory schemes have killed off mining, construction, community banks, and small business, and now he intends to bring the oil and gas industry to heel.  Every new regulation costs thousands of workers their jobs, but Obama continues issuing them with callous disdain for the welfare of ordinary citizens.

Obama's methane order reveals the true priority of today's Democratic Party: to appeal to the well-funded environmental lobby, not to raise living standards and lower the cost of living for ordinary Americans.  Once again, the ordinary American pays the price for the left's elitist agenda, designed to please the 1% that can easily pay higher energy prices.

The next president should reverse as many of Obama's regulations as possible, not least of all those that apply to the energy sector, so that the economy can begin to recover.  The only way to break the cycle of stagnation is to remove the hand of government and allow the free market to operate as it should.  Given a level playing field, American oil and gas producers can compete with foreign firms, and America can become the world's largest producer and exporter of oil and gas.  This means reversing regulations on the sector, many of them originating in the EPA and the Department of Interior.  The methane rule will be one of many places to start.

Jeffrey Folks is the author of many books and articles on American culture, including Heartland of the Imagination (2011).

In his last months in office, Barack Obama continues to issue regulations that cripple the energy sector.  Far from being a champion of the poor and the middle class, Obama is destroying jobs, raising energy costs, and making the U.S. vulnerable to foreign control.  The latest regulations on methane, announced on March 10 in a joint news conference with Canadian prime minister Justin Trudeau, are a perfect example of why the U.S. economy has been expanding at a snail's pace since 2008.

The EPA action announced Thursday would reduce methane emissions from existing oil and gas wells by up to 45% from 2012 levels by 2025.  Additional regulations would apply to new drilling and to drilling on federal lands.  Since hundreds of thousands of wells exist in the U.S., the methane regulations would impose a significant burden on the industry. 

Alongside the EPA actions, the Bureau of Land Management announced its own slew of methane regulations for federal and tribal lands. The new BLM rules would duplicate regulations that already require drillers to eliminate flaring of gas emissions.  The new rules would amount to a "paperwork and compliance nightmare for many small businesses," according to Congressman Kevin Cramer of North Dakota.  As Cramer put it, "[t]hese regulations have nothing to do with protecting the environment and everything to do with shutting down the oil and gas industry in our country."

At a time when oil prices are low, any regulation that makes U.S. drilling less competitive is a bad idea.  The cost of oil and gas production in the U.S. is already several times that of production in Saudi Arabia, Russia, and other oil-rich countries.  Obama's underlying agenda seems to be to weaken the U.S. energy industry relative to low-cost foreign producers.  By doing so, U.S. producers will be driven into bankruptcy, and eventually oil and gas prices will rise, making solar and wind appear more competitive.

By driving oil and gas drilling overseas, Obama's methane order would cost Americans thousands of high-paying jobs.  Middle East producers are eager to increase their market share.  Obama's methane regulations will make that happen.

Obama's methane order reflects the left's bias against fossil fuels.  A rational policy, if one believed that methane emissions were contributing significantly to climate change, would be to target all sources of methane emissions.  Obama's focus has been on the oil and gas industry – this despite the fact that oil and gas production is responsible for less than one half of one percent of total greenhouse emissions.

In fact, increased reliance on natural gas by U.S. utilities, homeowners, and industry has contributed more to reductions in overall greenhouse emissions than any other factor.  Natural gas produces half the carbon emissions of coal.  Those who believe that carbon emissions contribute to global warming (and that warming is a bad thing) should be applauding the increased use of natural gas in the U.S. economy.  Unfortunately, environmental extremists are determined to undermine reliance on all fossil fuels, regardless of efficiency, safety, and cost.

Methane release from oil and gas drilling is actually 20% less than that from agricultural sources.  So where are the new EPA regulations for agriculture?  So far, the EPA has focused on fossil fuels.  (Not that the agricultural sector should rest easy – left unchecked, the environmental left will bring every American industry to its knees.)

As it is, the oil and gas industry has already slashed methane emissions from new wells, cutting emissions from fracked wells by 79%.  Methane emissions from gas production overall is down by 38% since 2005.  Continued efforts by the industry, driven by the economic incentive of capturing 100% of gas produced at the wellhead, would be enough to solve the perceived problem.  It seems that what Obama wants is not a solution, but the demise of this important sector of the economy.

According to the American Petroleum Institute, the new methane regulations are duplicative, costly, and unnecessary.  A host of regulations already exist at the state and federal level limiting methane emissions from drilling and distribution of oil and natural gas.  Additional rules, combined with an arbitrary benchmark of 45%, arrived at without significant input from the private sector, is not the right way to proceed.

The new rules reflect the arrogance of an administration cut off from the people it purportedly serves.  Obama is eager to secure his legacy before leaving office, but that legacy will be decades of economic hardship, especially for the poorest quartile of earners for whom energy constitutes a larger share of living costs.

Clearly, the Democratic Party has become the party of the rich.  It is not by accident that wages for the American middle class have stagnated over the past eight years.  Obama's regulatory schemes have killed off mining, construction, community banks, and small business, and now he intends to bring the oil and gas industry to heel.  Every new regulation costs thousands of workers their jobs, but Obama continues issuing them with callous disdain for the welfare of ordinary citizens.

Obama's methane order reveals the true priority of today's Democratic Party: to appeal to the well-funded environmental lobby, not to raise living standards and lower the cost of living for ordinary Americans.  Once again, the ordinary American pays the price for the left's elitist agenda, designed to please the 1% that can easily pay higher energy prices.

The next president should reverse as many of Obama's regulations as possible, not least of all those that apply to the energy sector, so that the economy can begin to recover.  The only way to break the cycle of stagnation is to remove the hand of government and allow the free market to operate as it should.  Given a level playing field, American oil and gas producers can compete with foreign firms, and America can become the world's largest producer and exporter of oil and gas.  This means reversing regulations on the sector, many of them originating in the EPA and the Department of Interior.  The methane rule will be one of many places to start.

Jeffrey Folks is the author of many books and articles on American culture, including Heartland of the Imagination (2011).