EC to explore methane emission standards for EU fossil gas use

Brussels — The European Commission plans to explore all options to reduce methane leaks, including possible binding minimum standards for fossil gas used in the EU, it said in an EU methane emissions reduction strategy published on Oct 14.

Methane is a potent global warming greenhouse gas, and most leaks happen before the natural gas or LNG reaches the EU, so a new EU policy on methane emissions could have far-reaching impacts on the global gas market.

"Minimum methane emission standards, targets or other such incentives based on robust scientific analysis can play an effective role to ensure methane emission reductions in the EU and globally," the EC said.

The EC plans talks with producer countries on best practices for cutting methane emissions, hoping to leverage the EU's position as the biggest gas importing region in the world.

The EU's single biggest external gas supplier is Russia, mainly through pipeline gas. Other pipeline gas suppliers include Algeria, Libya and Norway, and from end-2020 Azerbaijan via Turkey.

The EU also imports LNG from many different countries, including the US.

Pressure on producers

If the producing countries do not make "significant commitments" to cut methane emissions, the EC said it would consider proposing legislation on targets, standards or other incentives to ensure lower emissions for fossil gas used in the EU.

Any such legislation would be based on an impact assessment that would look at the independent verification and compliance checks needed to enforce it, and its potential contribution to cutting global methane emissions.

There is no fixed timeline for this legislation yet, and enforcement is a key issue, according to an EU official.

"How do you go into the gas producing country and see if it has the emissions it has reported?" the official said. "Today's satellite data is not precise enough, and won't be for few years, to ensure a performance standard is met."

The EU gas supplier industry, meanwhile, supports targets for lower-carbon and renewable gases.

Its trade body Eurogas has called for a binding 2030 EU target to cut the greenhouse gas intensity of gaseous fuels by 20% from 2018 levels.

"This target will help meet higher climate ambitions and deliver an increasingly sustainable EU gas sector," Eurogas said on Oct. 13.

The EC wants the EU to be climate-neutral by 2050, and is preparing legislation under its European Green Deal strategy to make this happen.

Independent global observatory

The EC has already started work on setting up an independent international methane emissions observatory, working with the United Nations Environmental Program, the Climate and Clean Air Coalition, and the International Energy Agency.

It hopes to have it in place next year, according to an EU official.

This observatory would collect, reconcile, verify and publish data on global man-made methane emissions, building on existing voluntary initiatives such as the UNEP Oil and Gas Methane Partnership, the EC said.

The initial focus would be on oil and fossil gas sectors, and the EC wants to extend it to coal, waste and agriculture once more reliable monitoring is possible.

The EC also wants this observatory to compile and publish a methane supply index at EU and international level, enabling gas buyers to compare different sources.

But Poppy Kalesi, director of Global Energy at US-based NGO the Environmental Defense Fund, was skeptical that buyers would be influenced by the carbon footprint of their gas.

"If you leave it to the market, buyers will choose the cheapest gas," she told S&P Global Platts on Oct. 12.

The EC would propose using a default value within the EU for gas volumes, including imports, not covered by an "adequate" monitoring, reporting and verification system, in order to encourage accurate measurements.

The EC would use this default value as needed until "a compulsory measurement, reporting and verification framework for all energy-related methane emissions" was implemented.

This framework would build on the voluntary OGMP 2.0 methodology for measuring, reporting and verifying methane emissions data.

The OGMP currently focuses on upstream oil and gas companies, and members include BP, Ecopetrol, Eni, Equinor, Neptune Energy International, Pemex, PTT, Repsol, Shell, and Total.

The EC plans to propose binding legislation in 2021 on measuring, reporting and verifying methane emissions, as well as an obligation to improve detecting and repairing leaks.

Seeks binding UN accord

The EC said it also hopes to get a UN accord on cutting methane emissions to 2030 at the UN General Assembly in New York in September 2021.

Longer-term, it wants to see a legally-binding international framework for cutting methane emissions.