pollution deterrent

EPA sets out rules for proposed 'methane fee' for waste generated by oil and natural gas companies

A proposed Environmental Protection Agency rule intended to encourage industry to adopt best practices that reduce emissions of methane and thereby avoid paying. Photo via Canva

Oil and natural gas companies for the first time would have to pay a fee for methane emissions that exceed certain levels under a rule proposed Friday by the Biden administration.

The proposed Environmental Protection Agency rule follows through on a directive from Congress included in the 2022 climate law. The new fee is intended to encourage industry to adopt best practices that reduce emissions of methane and thereby avoid paying.

Methane is a climate “super pollutant” that is more potent in the short term than carbon dioxide and is responsible for about one-third of greenhouse gas emissions. The oil and natural gas sector is the largest industrial source of methane emissions in the United States, and advocates say reduction of methane emissions is an important way to slow climate change.

Excess methane produced this year would result in a fee of $900 per ton, with fees rising to $1,500 per ton by 2026.

EPA Administrator Michael Regan said the proposed fee would work in tandem with a final rule on methane emissions EPA announced last month. The fee, formally known as the Methane Emissions Reduction Program, will encourage early deployment of available technologies to reduce methane emissions and other harmful air pollutants before the new standards take effect, he said.

The rule announced in December includes a two-year phase-in period for companies to eliminate routine flaring of natural gas from new oil wells.

“EPA is delivering on a comprehensive strategy to reduce wasteful methane emissions that endanger communities and fuel the climate crisis,” Regan said in a statement. When finalized later this year, the proposed methane fee will set technology standards that will “incentivize industry innovation'' and spur action to reduce pollution, he said.

Leading oil and gas companies already meet or exceed performance levels set by Congress under the climate law, meaning they will not have to pay the proposed fee, Regan and other officials said.

Sen. Tom Carper, chairman of the Senate Environment and Public Works Committee, said he was pleased the administration was moving forward with the methane fee as directed by Congress.

“We know methane is over 80 times more potent than carbon dioxide at trapping heat in our atmosphere in the short term,'' said Carper, D-Del. He said the program "will incentivize producers to cut wasteful and excessive methane emissions during oil and gas production.”

New Jersey Rep. Frank Pallone, the top Democrat on the House Energy and Commerce Committee, said oil and gas companies have long calculated that it's cheaper to waste methane through flaring and other techniques than to make necessary upgrades to prevent leaks.

“Wasted methane never makes its way to consumers, but they are nevertheless stuck with the bill,” Pallone said. The proposed methane fee “will ensure consumers no longer pay for wasted energy or the harm its emissions can cause.''

Republicans call the methane fee a tax that could raise the price of natural gas. “This proposal means increased costs for employers and higher energy bills for millions of Americans,” said Sen. Shelley Moore Capito, R-West Virginia.

The American Petroleum Institute, the oil and gas industry's largest lobbying group, slammed the proposal Friday and called for Congress to repeal it.

“As the world looks to U.S. energy producers to provide stability in an increasingly unstable world, this punitive tax increase is a serious misstep that undermines America’s energy advantage,'' said Dustin Meyer, API's senior vice president of policy, economics and regulatory affairs.

While the group supports “smart” federal methane regulation, the EPA proposal “creates an incoherent, confusing regulatory regime that will only stifle innovation and undermine our ability to meet rising energy demand,'' Meyer said. “We look forward to working with Congress to repeal the IRA’s misguided new tax on American energy.”

Fred Krupp, president of the Environmental Defense Fund, called the proposed fee "common sense,'' adding that oil and gas companies should be held accountable for methane pollution, a primary source of global warming.

In a related development, EPA said it is working with industry and others to improve how methane emissions are reported, citing numerous studies showing that and oil and gas companies have significantly underreported their methane emissions to the EPA under the agency's Greenhouse Gas Reporting Program.

The climate law, formally known as the Inflation Reduction Act, established a waste-emissions charge for methane from oil and gas facilities that report emissions of more than 25,000 metric tons of carbon dioxide equivalent per year to the EPA. The proposal announced Friday sets out details of how the fee will be implemented, including how exemptions will be applied.

The agency said it expects that over time, fewer oil and gas sites will be charged as they reduce their emissions in compliance with the rule.

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A View From HETI

Coastal lawmakers have filed at least six bills that would require emergency generators on site for senior facilities. Photo by Brandon Bell/Getty Images

When a storm hits the Texas coast during the summer hurricane season, state Sen. Borris Miles knows among the first calls he’ll get is from a constituent letting him know power is down at an independent living complex, shutting off air conditioning for older Texans.

“‘Senator! You got these people here,’“ he said, recalling a plea from a caller when Hurricane Beryl knocked out power to an assisted living facility last summer. “‘What are we going to do?’’’

Miles, D-Houston, is thankful for residents like these. But as the number of storms have increased, so has the frustration for southeast Texas lawmakers who want better solutions.

That’s why Miles and four other coastal lawmakers have filed at least six bills that would require nursing homes, assisted living facilities and even some apartments that market to the 55 and older set, to have emergency generators on site. In Texas, there are 1,193 nursing homes serving more than 86,000 patients and 2,004 assisted living facilities housing 49,574 residents.

Miles’ House Bill 732 would require certain low-income housing for seniors living independently to have backup power. In recent years, Miles has seen more of these facilities being built in Houston. Often living in multistory apartment buildings, residents of this type of housing do not receive care, so little information, including on their health conditions, are collected. But after a storm knocks out power, the vulnerable conditions of these residents surface, as some in wheelchairs and walkers become trapped in elevators that are inoperable, Miles said.

“We need to take care of people,” he said.

SB 481 from state Sen. Carol Alvarado, D-Houston, would require emergency plans at nursing homes and assisted living facilities to include generators. Nursing homes, which as the name suggests, offer more intense medical support to patients compared to assisted living facilities, which are senior apartments that provide meals and some assistance to its residents. HB 1199 by Rep. Christian Manuel, D-Beaumont, calls for emergency generators that have the capacity to run for a minimum of 72 hours in such facilities.

“Texans know firsthand the impact of being without power, particularly in elder care facilities where the stakes are incredibly high,” Manuel said in a statement.

Rep. Suleman Lalani, D-Sugar Land, has filed HB 1467 that would require nursing homes, assisted living and independent housing for seniors to have generators. Another one of his bills, HB 863, would create a shared database of where senior independent living communities are and include each complex’s emergency plan, which is required by the state for assisted living and nursing homes. The database would be accessible to emergency response officials.

“Things happen and then people make noise and then people go quiet,” he said, remarking on past failed attempts to get a generator bill passed. “I think I have a unique opportunity and responsibility being a physician…I cannot go back and say ‘Oh,’ I will let it go.”

History of generator bills and pushback

In this century alone, Texans have seen damage and death from hurricanes Rita in 2005, Ike in 2008, Harvey in 2017 and last July’s Beryl, not to mention more freak storms like Uri’s freeze in 2021 and last year’s wildfires in the Panhandle and a windstorm in the Houston area. All have taken the power down for hours, days and in the case of Beryl, weeks.

Former state Rep. Ed Thompson of Pearland became a champion for senior facility residents following a simple spring storm in 2018 that caused a power outage in his district.

After arriving to check on a nearby senior facility, he was stunned to find an ill-prepared staff. Residents had been in a hot and dark facility for hours. When he asked a worker about the facility’s emergency plan, he was incensed that it relied mostly on calling families to pick up their relatives or for those who had no family, just sending them to the local emergency rooms.

“That lit a fire in me,” he told the Tribune last week.

Calls for generators to be required equipment, particularly at assisted living facilities, are nothing new, but bills in the last two legislative sessions have died, including Thompson’s in 2023. His legislation stalled in committee after facing opposition from the nursing care and assisted living industries, which raised concerns, mostly about generator’ costs, which is estimated to be at least $200,000 or more for a facility.

That’s why this session, Rep. Ana Hernandez, D-Houston, has filed HB 2224 which would require backup power for elevators for 48 hours after a power loss. “A significant reduction in cost,” she said. Past bills that have failed, she said, have focused on keeping the entire facility powered.

“It is inhumane to leave an elderly person abandoned without electricity in temperatures over 100 degrees for days, or even weeks,” Hernandez said. “Not having at least one elevator poses a high safety risk of elderly people being trapped on upper-level floors, prohibiting residents from escaping a fire or seeking medical care.”

It’s not clear whether the smaller price tag on such a requirement will get the buy-in of the influential long-term care industry.

The Texas Health Care Association, now headed by former state Sen. Travis Clardy, represents most of the state’s nursing homes and he says his members already have generators but any blanket requirement for equipment that has to be purchased and maintained, perhaps once every few years, is a costly state mandate.

“I think our membership would prefer to be able to see that channeled into higher quality care,” Clardy said.

Requirements during a storm

When a storm heads for Texas, the state Health and Human Services Commission sends out emergency alerts to providers, putting them on notice that their emergency plans should be ready for use in case of a loss of power. The agency also contacts the facilities directly to check on the health and safety status of residents.

Last year, some 80 long-term care facilities were without power three days after Hurricane Beryl made landfall on July 8. According to the agency, both assisted living facilities and nursing homes are always responsible for the safety of residents including during a storm.

Emergency preparedness plans, which all assisted living and nursing home facilities must have, include a list of contacts workers will call in the event of a power outage and how they will evacuate residents if they need to do so.

Since 1996, state law has required all new nursing homes to have an emergency generator that powers safety features such as emergency lighting and exit signs, fire alarm systems, nurse call systems, telephones and medication and life-saving equipment. Assisted living facilities are not required to have a generator.

That said many assisted living facilities have some type of power back up to keep food or medications refrigerated. But cooling and heating all living areas is not something that has been explicitly required for assisted living facilities or nursing homes.

Since 2016, federal law requires generators in nursing homes in new and replacement nursing homes or for all nursing homes that have indicated in their emergency plans they would rely on emergency power to provide heating and cooling or other critical systems.

However, the agency does not regulate other types of housing such as independent, senior, or congregant living facilities. These entities do not hold a state license and are not required to report any information to the state health agency.

Carmen Tilton, vice president of public policy for the Texas Assisted Living Association said her industry has been a willing collaborative partner with lawmakers on the issue of requiring generators.

After Hurricane Harvey, her organization worked with the state to to hammer out a regulation that requires facilities to keep temperatures inside no colder than 68 degrees and no hotter than 82.

“The state doesn’t say you have to check a box,” she said.

The agency leaves it to industry to determine how they will meet that standard. It could be cooling one room inside a facility with fans and portable generators and bringing residents into that one room or if assisted living facilities wanted to purchase and maintain a larger generator, they can do so without the state determining the size, or how much fuel to keep on hand at all times.

That flexibility is what the assisted living industry wants to keep in place, Tilton said.

“We recognize that everyone’s set-up is a little bit different,” she said. “We’re not fighting these bills. We’re trying to find out how to make them work under our existing regulations.”

AARP Texas, which is advocating for generators in assisted living facilities, wants more clarity in law, not just in the administrative code. The code is too often and too easily changed, said Andrea Earl, an associate state director of advocacy and outreach at AARP Texas.

“There’s no assurances in law that healthy temperatures will be maintained at all times in the residential spaces of Texas’ long-term care facilities,” she said.

Some local governments are not waiting on the legislature to act. Earlier this month, Harris County announced it was incorporating into its fire code a requirement for generators for all nursing homes and assisted living facilities located in unincorporated areas.

There’s already been pushback.

“The new mandate is problematic in many ways and would needlessly require communities to reconfigure existing systems,” said Diana Martinez, the assisted living association’s president and CEO, in a statement. “Generators are not a one-time expenditure nor are they a panacea. Generators do fail.”

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This story was originally published by The Texas Tribune and distributed through a partnership with The Associated Press.

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