WASHINGTON — The Republican-majority Congress has successfully passed a resolution to overturn a federal levy on oil and gas companies that emit significant amounts of methane, thereby dismantling a crucial element of former President Joe Biden’s climate strategy. This fee was designed to regulate emissions of methane, a potent greenhouse gas responsible for a considerable portion of global warming. The levy, which had not yet been implemented, was projected to generate billions in revenue.
On Thursday, the Senate voted 52-47 in favor of repealing the fee, in a decision mirroring the vote taken by the House of Representatives the previous day. The resolution is now awaiting approval from President Donald Trump, who is anticipated to endorse it.
Methane holds a far greater warming potential than carbon dioxide, particularly in the short term, and is attributed to about a third of current global warming levels. As some of the largest methane emitters in the United States, oil and gas industries play a pivotal role in efforts to mitigate climate change.
Notably, the majority of significant oil and gas firms do not release enough methane to incur the fee, which is initially set at $900 per ton and planned to rise to $1,500 by 2026. This provision was part of the 2022 Inflation Reduction Act, although the Environmental Protection Agency (EPA) did not formalize its rules until late in the previous year.
The timing of this implementation rendered it susceptible to the Congressional Review Act, enabling Congress to thwart any finalized rules close to the end of a president’s term. Should these overturns succeed and gain presidential authorization, agencies are barred from issuing a similar rule subsequently.
Tyson Slocum, director of Public Citizen’s energy initiative, expressed disapproval, stating, “It’s a sorry testament to the influence of Big Oil on Capitol Hill that one of the top priorities of Congress is a blatant handout to the worst actors in the fossil fuel industry.”
In contrast, the American Petroleum Institute, the premier representative for the oil and gas sector, praised the repeal, denouncing the fee as a “duplicative, punitive tax on American energy production that stifles innovation.” Amanda Eversole, executive VP and chief advocacy officer at API, highlighted, “Thanks to industry action, methane emissions continue to decline as production increases, and we support building on this progress through smart and effective regulation.”
Globally, aerospace concentrations of methane have seen a consistent rise.
Discussing the repeal on the Senate floor, Republican Sen. Shelley Moore Capito of West Virginia, who leads the Senate’s Environment and Public Works committee, remarked on the necessity of boosting natural gas production “We should be expanding natural gas production, not restricting it. Instead, the natural gas tax will constrain American natural gas production, leading to increased energy prices and providing a boost to the production of natural gas in Russia,” she declared.
Highlighting the inefficiency associated with gas leaks, it is noted that producers squander gas that could otherwise be preserved and sold. Sen. Sheldon Whitehouse of Rhode Island, the leading Democrat on the environment panel, commented, “Republicans are helping out the absolutely worst offenders of methane leakage. The companies only pay the methane fee if they don’t meet their own industry standard for … avoiding leaks of a dangerous, explosive, poisonous greenhouse gas.”
This elimination of the methane fee marks one of several pro-oil and gas policies introduced since Trump assumed office. His initial day in office featured declaring a national energy emergency, pushing for increased oil and gas output while reducing environmental assessments. Democratic efforts to counter this emergency declaration were unsuccessful. Additional actions by Trump include revoking a pause on new liquified natural gas export terminal applications, withdrawing the U.S. from the Paris climate accord, and seeking to open further lands and waters for exploration by oil and gas companies.
Initially designed to incentivize the adoption of enhanced emission control measures, the methane fee was anticipated to mitigate 1.2 million metric tons of methane emissions by 2035. This reduction equates to removing 8 million vehicles from roadways for an entire year.
The Biden administration had enacted methane regulations for existing oil and gas wells after addressing emissions from new wells, intending the fee to bolster those rules and emphasize the worst offenders. A recent study indicates nearly half of all methane emissions from wells originate from a mere 6% comprised of smaller producers.
