State agencies that worked for years on plans to meet the Biden administration’s energy and environmental policies are facing the reality that efforts to tackle methane emissions could be moot once President-elect Donald Trump takes office next month.
Officials from energy-producing states are struggling to figure out which rules will stick, which will likely be trashed and what to do in the absence of definitive information about what happens next. Signals from Washington in the months ahead may determine how plans change in jurisdictions across the country.
“What we need is some certainty over the long term so we can start planning for reduced emissions and for better uses of our resources,” said David Glatt, director of the North Dakota Department of Environmental Quality. “North Dakota is in a prime position to start looking at reduced emissions, if we’re not dealing with all this paperwork.”
Most of the work to change state-level oversight of the oil and gas industry has been focused on monitoring compliance with new federal rules around the industry’s methane emissions.
The Biden administration authored three main rules on methane emissions from the energy sector. Methane, the largest component of natural gas, retains roughly 80 times more heat over two decades than carbon dioxide.
One will require operators to pay a $900 fee for every metric ton of methane leaked over a certain percentage starting in 2025. Another would require fossil-fuel burning power plants, including those burning natural gas, to control 90 percent of their carbon dioxide emissions through carbon capture and sequestration by 2032. A third requires oil and gas operators to replace old infrastructure with new equipment less prone to leaking, among other things.
Jeff Wood, a partner at the Baker Botts law firm in Washington, said it’s common for new administrations to come in and change rules made by previous presidents and EPA administrators. But making changes to some of the methane rules put in place under President Joe Biden may be more difficult, Wood said, thanks largely to the 2022 Inflation Reduction Act.
“The difference this time is, at least with some key aspects of the methane rule regime that’s now in place, there’s been statutory enactment — most notably the IRA and its methane charge provisions — that need to be carefully navigated in order to make changes,” Wood said.
Three issues are at play, Wood said: litigation, prior regulations and more recent regulation.
For example, the Inflation Reduction Act added a new section to the Clean Air Act to create a methane emissions and waste reduction incentive program, which directs the EPA administrator to impose and collect charges on excess methane emissions from some oil and gas operations.
Because the IRA amended the Clean Air Act to create the methane fee, Wood said, it would likely take an act of Congress to get rid of it.
A fully GOP-controlled Congress could prevent implementing regulations for the fee through the Congressional Review Act (CRA), or it could repeal the Inflation Reduction Act altogether through budget reconciliation. But both avenues could be difficult to achieve.
The CRA enables rules to be tossed by lawmakers if they were finalized during the last 60 days of the previous session of Congress.
“It’s always difficult to adopt regulations under the Clean Air Act that apply in this way,” Wood said, adding that people will inevitably disagree over how high the fee should be.
Wood said one key factor is that the methane fee is statutorily grounded in the IRA and accounts for overall compliance with the methane restrictions. He said Congress may decide to revisit the issue.
Texas Republican Gov. Abbott said at an appearance last week that Trump has indicated that he plans to “get rid of the EPA regulations that have tied the hands of the energy sector in the state of Texas.”
In a statement Friday, Trump transition spokesperson Karoline Leavitt said the president-elect advanced conservation and environmental stewardship during his first term, while promoting economic growth. Trump’s inauguration is set for Jan. 20.
“America’s energy agenda under President Trump produced affordable, reliable energy for consumers along with stable, high-paying jobs for small businesses — all while dropping U.S. carbon emissions to their lowest level in 25 years,” she wrote. “In his second term, President Trump will once again deliver clean air and water for American families while Making America Wealthy Again.”
There also are various lawsuits working their way through federal courts over other rules. The Supreme Court denied requests to stay EPA’s power plant rule and also refused to issue a stay for the rule requiring oil and gas operators to update their infrastructure.
Lawsuits on those issues remain ongoing, but state agencies are still compelled to comply with them — at least for now, said Betsy Peticolas, an attorney for the Railroad Commission of Texas during a recent hearing.
The three members of the Railroad Commission have criticized a number of Biden’s policies, including its methane rules. In January, they voted unanimously to ask Texas Attorney General Ken Paxton to sue over the methane infrastructure rule.
However, because of the stays, state agencies are still required to submit plans for implementing the rules, Peticolas said. In the case of the methane infrastructure rule, the Texas Commission on Environmental Quality is responsible, she said.
“Because the rule was not stayed, the 24-month deadline for states to submit their respective plans remains in effect,” Peticolas said. “To that end, TCEQ is currently working on a rulemaking to promulgate Texas’ state plan that will exist to existing oil and gas sources, or what EPA calls designated facilities.”
TCEQ declined to comment on its work with the plan and what it plans to do in the period before Trump comes into office.
Glatt, with the North Dakota Department of Environmental Quality, said his office has hired 10 full-time employees to help implement the methane infrastructure rule alone.
“Every company has to submit a report on how they’re doing inspections and maintaining facilities. Some of that is helpful, but the timelines and plans coming in from each of the facilities can be onerous,” Glatt said. “Doing a lot of paperwork doesn’t decrease emissions in our mind.”
Some states, however, may feel little impact if the Trump administration or Congress are able to rescind the three main methane rules, thanks to their own regulations.
Forged ‘own path’
About a year before the IRA passed, the New Mexico Energy, Minerals and Natural Resources Department, or EMNRD, created some of the strictest rules in the country around methane emissions at the time.
The department — directed by an executive order from Democratic Gov. Michelle Lujan Grisham in 2019 — required oil and gas operators to capture no less than 98 percent of the methane they produce by 2026. It also prohibits routine flaring and venting as of 2026.
Flaring is when operators light natural gas on fire, converting it to carbon dioxide when it burns off, and venting disperses methane into the atmosphere unabated.
Melanie Kenderdine, cabinet secretary of EMNRD, said having the state’s existing rules on the books gave New Mexico a leg up when it came to drafting and implementing Biden’s methane rules. She said her department is still analyzing what it believes the incoming Trump administration can and cannot do when it comes to methane rules.
“Even if the EPA methane rules go away, New Mexico is positioned to continue protecting its air quality in ways other states don’t have, frankly,” Kenderdine said in an interview.
Colorado is in a similar situation.
Earlier this year, the state’s Department of Public Health and Environment began working on a draft proposal to update a state emissions rule to align the state’s regulation with parts of EPA’s methane infrastructure rule. The rule would require all operators to account for and reduce greenhouse gas emissions from new and existing infrastructure.
The Colorado Air Quality Control Commission will consider the proposal in February and, if adopted, the changes will go through “regardless of any potential changes to EPA’s methane rule in the future,” said Leah Schleifer, a spokesperson with the Colorado Department of Public Health and Environment in a statement.
“It’s too early for us to speculate on any impacts from the incoming federal administration,” Schleifer wrote, adding, “Colorado has always forged its own path in addressing climate change and will continue to do so in the future.”
Regardless of state statutes or rule repeals by the Trump administration, some think oil and gas companies will go through with methane reduction measures.
“One of the things we’re hearing is that oil and gas companies have invested so much, so many resources and so much into compliance with methane reduction in preparation for the incoming federal rules, that now they are not going to be lobbying against them or for a repeal,” New Mexico’s Kenderdine said.
Glatt with the North Dakota Department of Environmental Quality disagreed. He pointed to Project Tundra, a $2 billion carbon capture project at a North Dakota coal plant, where developers have postponed a final investment decision over concerns with regulatory changes.
“We have permitted a power plant to start building a post combustion combined cycle unit, but with all the uncertainty with new regulations, I think they’re having some second thoughts on whether they should proceed,” Glatt said.
