EPA Recognizes Utility Efforts to Reduce Emissions

News Release May 12, 2016

Washington, D.C. – In its release of a final rule for emission standards for the oil and natural gas industry for new, reconstructed and modified sources today, the U.S. Environmental Protection Agency (EPA) recognized the ongoing work by natural gas utilities to reduce emissions.

The rule does not include distribution infrastructure or assets operated by local distribution companies in their services territories. A concerted effort by natural gas utilities to upgrade and modernize our nation’s pipeline network to enhance safety has contributed significantly to a declining trend in emissions from the natural gas system. Natural gas utilities also participate in voluntary programs to reduce emissions.

The 2016 EPA Inventory of U.S. Greenhouse Gas Emissions and Sinks released in April showed that emissions from local distribution systems decreased by 74 percent from 1990 to 2014 following a substantial downward revision for the sector. EPA attributes the decrease to the industry’s continued work to replace pipelines no longer fit for service with ones made from modern plastic materials, as well as upgrades at metering and regulating stations. Today, natural gas utility systems account for only six percent of total methane emissions from the natural gas value chain.

While all natural gas utilities upgrade and modernize their infrastructure using risk-based integrity management programs, 39 states and the District of Columbia now have specific rate mechanisms that foster accelerated replacement of pipelines. In the case of the states without such programs, several no longer have pipelines made of legacy materials and others recover their costs through annual rate cases.

In March, 41 AGA member companies – representing 66 percent of the natural gas customers served in the United States – were Founding Partners of the EPA’s Natural Gas STAR Methane Challenge Program whereby oil and gas companies can make and track commitments to reduce emissions and showcase their efforts to improve air quality and capture and monetize this valuable energy resource. TheAmerican Gas Association and many of its members were founders of the originalNatural Gas STAR programin 1993.According to the EPA, the 50 AGA member companies participating in the Natural Gas STAR programreduced emissionsby 0.8 billion cubic feet in 2013 and a total of 46.2 billion cubic feet since 1993.

The American Gas Association, founded in 1918, represents more than 200 local energy companies that deliver clean natural gas throughout the United States. There are more than 76 million residential, commercial and industrial natural gas customers in the U.S., of which 95 percent — more than 73 million customers — receive their gas from AGA members. Today, natural gas meets more than thirty percent of the United States' energy needs.