GHG EmissionsThe Importance of Reducing Methane Emissions

Methane causes more than 80 times more warming than the same amount of CO2, making reduction solutions critical...
by: Lucas Piazza

We’ve all heard of “carbon emissions” and the need to reduce them. Perhaps you’ve also heard of the broader term “greenhouse gas (GHG) emissions,” of which carbon dioxide is a part. But very little attention, comparatively, gets paid to “methane emissions” even though this gas is a more potent short-term driver of global warming than CO2. Measured over 20 years, methane causes more than 80 times more warming than the same amount of CO2, according to the U.N.’s scientific panel on climate change.

Given methane’s potency, reducing emissions generated from this gas is central to solving the current climate crisis. By the end of this century, countries and companies must limit global warming to around 1.5°C (2.7°F) in order to avoid the worst effects of climate change. This requires GHG emissions to peak before 2025, and then be reduced by 43% by 2030. It also requires methane to be reduced by a third over the same time period.


Where Do Methane Emissions Come From?


Achieving the IPCC’s methane emissions goals requires countries and companies to focus on targeting the biggest sources of this GHG. The U.S. EPA has determined that the two largest sources of methane are from the natural gas and petroleum industry (32%) and livestock agriculture (27%) — together these two sources represent more than 50% of all methane emissions in America. 


Source: U.S. EPA


When examining the natural gas and petroleum industry, we see methane is emitted during the production, processing, storage, transmission, and distribution of natural gas and the production, refinement, transportation, and storage of crude oil. Coal mining is also a source of methane emissions. Turning our attention to livestock agriculture, we understand methane is released by cattle, pigs, sheep, and goats as part of their normal digestive processes.  


Reducing Methane Emissions


Countries around the globe are beginning to take action to reduce methane emissions. In 2021, the Global Methane Pledge was signed by more than 100 countries. These country-specific commitments collectively aim to slash global methane emissions by 30% by 2030 from 2020 levels and center around capturing gas (and the related emissions) that would otherwise be wasted due to venting, flaring, or leaks during the natural gas production process. 

In the United States, the recently passed Inflation Reduction Act (IRA) introduced a fee for methane emissions from oil and gas companies who report emissions under Subpart W of the Clean Air Act. The new fees apply to a facility’s emissions in excess of 25,000 metric tons carbon dioxide equivalent (“CO2e”) and begin at $900 per metric ton of methane emitted in 2024 and will increase to $1,200 in 2025, and $1,500 in 2026. Both offshore and onshore producers, natural gas processing, transmission and compression, underground gas storage, LNG facilities, gas gathering, and boosting stations are all included in the new fee. 

Oil and gas companies can reduce methane emissions by using readily available technologies that reduce or eliminate venting and flaring of natural gas and better manage methane as a result. Sensor and monitoring technologies are also increasingly important for measuring methane emissions 24 hours a day, 7 days a week to ensure emissions remain under control.


Turning Low Methane Activities Into Value


After oil and gas companies implement mitigation and monitoring solutions, the gas molecules they produce can be certified by third-party firms, such as Project Canary, as “responsibly sourced gas (RSG)”. The market for RSG is growing rapidly as companies across industries look to support sustainable activities to offset the impact of their own Scope 1, Scope 2, and Scope 3 GHG emissions. 

The surging demand for RSG, coupled with an increasingly strict regulatory landscape surrounding methane emissions, creates an important economic opportunity for RSG production. EarnDLT offers oil and gas producers a solution for easily and securely monetizing the low-emissions data associated with their RSG molecules. Contact us to setup a demo today.

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