Step on the gas
Donald Trump may have ditched the methane fee, but energy producers are still under pressure to cut emissions
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"Regardless of regulations, there are still eyes in the sky - satellites that are tracking emissions to the source level."
- Dan Byers, United States Chamber of Commerce's Global Energy Institute
The methane fee, formally known as the Waste Emissions Charge (WEC), was introduced under the Biden Administration in August 2022, part of the Inflation Reduction Act (IRA).
The policy introduced a charge on the excess methane emitted by US fossil fuel producers, estimated to account for a little over one-third America’s methane emissions. The levy was a pioneering first step, marking the first time that the federal government has imposed a nationwide charge on the emissions of a greenhouse gas.
Excess methane emissions occurring during calendar year 2024 would have incurred a charge of $900 per tonne of methane ($36 per tonne of CO2e), rising to $1,200 in 2025, and $1,500 from 2026. Fossil fuel facilities emitting less than 25,000 tonnes of CO2e per year - responsible for around 60% of industry emissions - were exempt from the charge (see Pricing methane emissions out of the atmosphere: America's first nationwide price on a greenhouse gas does not go far enough).1
In November 2024, the Environmental Protection Agency (EPA) finalised the ruling, charging the agency with enforcing the fee. Alas it wasn’t to be. Donald Trump’s return to the White House meant the methane fee never saw the light of day. In March, Trump signed into law the Congressional Review Act, effectively blocking the implementation of the methane fee.
The US is the dominant LNG exporter, however data reveals that its energy producers are woefully underestimating their methane emissions, and that's a big concern for energy buyers in Europe and Asia (see 'Carbon neutral' LNG 2.0).