The Ad Hoc Gist: I’m the Problem, It’s Me(thane)

The Ad Hoc Gist: I’m the Problem, It’s Me(thane)

February 2024

Fossil gas is a big problem for the climate. And there are major political battles being waged on how much we need and for how long.

Regardless of their outcome, we’re going to have a gas system for the foreseeable future. So, as Ian Rinehart and Sam Bauer write in this month’s Gist, we should lean in hard to stop methane leaks from gas extraction and infrastructure.

Stay in touch with us on LinkedIn or subscribe to get the newsletter in your inbox.

- Jim Kapsis, CEO
The Ad Hoc Group

We are committed to the decarbonization and electrification of our energy and transportation systems. But the path forward is complicated and will require us to come to terms with some uncomfortable truths.

So, let’s get real about fossil gas. It needs to go, but we can’t snap our fingers and make it disappear overnight. Right now, gas is everywhere and usage continues to grow, with both production and consumption recently hitting record highs. There are nearly 3 million miles of gas pipelines serving over 2,000 gas power plants, heating over 58 million households, and providing 41% of the energy needed for industrial processes.

The National Renewable Energy Laboratory (NREL) actually predicts gas-fired electricity capacity will increase through 2050, even if we cut power sector emissions 95%. Why? Gas power plants will still be needed to ensure reliability during the most demanding hours on the grid – even as the share of wind, solar, and battery storage grows substantially.

Yes, we need to move to fossil-free electricity and electrified buildings as fast as we can. But we can’t ignore the ongoing climate impacts of the fossil gas system.

I'm the Problem, It's Me(thane)

The gas system contributes to climate change in two key ways: it generates carbon dioxide (Co2) when burned for heat or electricity (e.g., in a power plant or furnace), and it releases methane into the atmosphere when infrastructure leaks (e.g., through pipes or during extraction).

Burning gas for electricity emits about half as much Co2 as burning coal. In a zero leak scenario, we’ve already made a big dent in our climate goals. And the Environmental Protection Agency (EPA) is finalizing emissions standards for fossil-fuel power plants due out in April that should require existing and new gas plants to deploy carbon capture technologies or the equivalent to address the long-term Co2 problem.

But methane is the bigger climate problem in the near term because it has a shorter lifespan than Co2, meaning it traps far more heat in the atmosphere – 80 to 100 times more, in fact, over a 20-year period.

Multiple studies have confirmed that the EPA’s current estimates grossly underestimate methane leaks. A 2023 study suggested methane emissions between 2010 and 2019 were 70% higher than estimates.

We’ve made a grand bargain to replace coal with gas for electricity generation under the presumption that gas is cleaner – and it certainly can be. But if we’re wrong about the leak rates, we’re potentially just swapping one poison for another.

Fortunately, new technological advancements and policies are pushing the gas industry to get better at detecting, measuring, and reducing methane emissions. For example, using real data, instead of estimates, underpins near-term actions to address the climate impact of the gas system. And, added bonus, around half of the options to reduce emissions from gas operations worldwide could be implemented at no net cost.


Satellites, Sensors, and Startups

We first highlighted some of these technologies in an earlier Gist on the war in Ukraine. Since then, more companies have emerged in four key areas:

These technologies can be used in concert with one another. Satellites provide powerful, basin-wide snapshots to identify super-emitters, while drones, planes, and vehicles localize leaks along pipelines. New sensors and software algorithms can continuously monitor and detect methane with much greater accuracy and quantify leak amounts in real time.

Technology can’t solve this problem on its own, however. The federal government and several states are taking steps to address methane, but the upcoming election could put some of these efforts at risk.

The Federal Government Walks the Walk

Three new federal methane rules should help encourage the adoption of these technologies.

First, the Department of Transportation’s (DOT) Pipeline and Hazardous Materials Safety Administration (PHMSA) will soon finalize a rule that would require gas pipeline operators to survey their systems and repair all gas leaks.

Second, the EPA finalized the “Quad-O” standards in December, which require stricter methane leak monitoring and repair for gas wells, processing plants, compressor stations and storage facilities. The rules lean on new technologies by allowing third parties (e.g., environmental groups) to notify the EPA of major leaks, versus relying on operators to self-report.

And, instead of requiring a human to walk around sites to manually detect leaks, technology such as continuous monitoring sensors can now be used for the first time. This is a big deal as companies will only adopt new technologies when they know they can be used for compliance.

Finally, in January, the EPA proposed the Waste Emissions Charge, a provision of the Inflation Reduction Act (IRA). It would impose a significant fee of $900 per ton of leaked methane, rising to $1,500 per ton by 2026.

Three important caveats: the charge does not apply to gas distribution (e.g., your local gas utility), it only covers large facilities (~70% of leak volume), and only takes effect if facilities don’t comply with the new Quad-O rules.

Together, these policies are still expected to reduce 2030 emissions by >150 million metric tons of Co2 equivalent, more than the annual emissions from 33 million gasoline-powered cars.


States Aren’t Off the Hook

States will be an important backstop if a second Trump Administration attempts to roll back the new EPA rules as expected. That means they need to pick up where the federal rules stop.

Several oil and gas producing states, including New Mexico and Colorado, now limit routine venting and flaring. New York, with limited in-state oil and gas production of its own, updated its greenhouse gas inventory to include out-of-state methane emissions associated with in-state fossil fuel consumption.

New York also accounts for pollutants over a 20-year lifetime, giving utilities a clear incentive to eliminate leaks on their system, and to buy gas only from producers that eliminate methane across their supply chain. Recent utility pilots will follow a certification process aligned with best practices outlined by the Environmental Defense Fund to avoid greenwashing.

Air regulators and environmental agencies in other states should follow New York’s example. Today, states like Maryland and Michigan either ignore upstream emissions entirely, or forbid utilities from taking environmental benefits into account when procuring gas. That’s a mistake.

States and commissions should also encourage utilities to adopt new technologies that will generate the data needed to decide whether it’s more cost effective to eliminate methane leaks in a given situation or consider alternative pathways, such as completely electrifying a portion of the gas system.

In the end, we have to come to grips with the fact that large portions of the gas system will likely be with us for decades to come and make informed decisions on how to reduce its worst climate impacts today. This will require us to measure, baseline, and make a plan to reduce methane leaks or pursue reasonable alternatives.

News from Our Network

From our clients:


From friends and colleagues:

Jobs in our network: 

Send us your job openings in cleantech policy, startups, and utilities, and we'll put them in next month's Gist.

Aeroseal: Commercial Energy Efficiency Market Development Manager

BoxPower: Utility Sales Senior Account Manager

Google Nest: Director, Product Management, Consumer and AI Experiences

Tyba: Founding Power Market Analyst

Pano AI: Enterprise Account Manager 

Uplight: Utility Sales Director

Westly Group: Senior Associate

ACEEE: Buildings Program Director

Powerhouse Ventures: Associate

Climeworks: VP of Policy and Government Affairs

Alliance for Clean Energy New York: Executive Director

Energy Impact Partners: Vice President/Senior Associate of Equity

ZETA: Regulatory Analyst

Cortex: Senior Director, Customer Success

Find us:

NARUC Winter Policy (Feb. 25-28, Washington, D.C.)
Annie Gilleo, Maya Kelty, Ian Rinehart, and James Schulte are attending. Brian Kooiman, Max Tuttman, Jim Kapsis, and Sabrina C. de la Vega will be in town as well!

DISTRIBUTECH International (Feb. 26-29, Orlando)
Brian Kooiman and Ian Rinehart are attending

NRECA Tech Advantage (March 3-6, San Antonio)
Anjana Agarwal is attending

Alliance for Transportation Electrification (March 7-8, Washington, D.C.)
Annie Gilleo and James Schulte are attending

EPRI Electrification (March 12-14, Savannah)
Max Tuttman is attending