Over the past couple years of energy market turbulence, pretty much everyone has come to acknowledge that the U.S. — and the rest of the world — will continue to require refineries and refined products for decades to come. It’s also likely, though, that U.S. refiners, like their European counterparts, will be required to do more to reduce the volumes of carbon dioxide (CO2) and other greenhouse gases (GHGs) generated during the process of breaking down crude oil and other feedstocks into gasoline, diesel, jet fuel and other valuable products. And, thanks to new federal incentives, it might even make sense for refineries to capture and sequester at least some of the CO2 they can’t help but produce. In today’s RBN blog, we begin a series on refinery CO2 emission fundamentals, the differing policies that are applied here in the U.S. and abroad, and how those policies might ultimately influence refining competitiveness.
Emissions
Oil and gas companies across the value chain are facing new pressures to manage and reduce methane emissions. Their ability to access premium markets and buyers, appeal to investors and avoid costly fees depends on developing a credible plan to measure and reduce methane emissions. At the very least, the industry’s regulatory outlook, its non-governmental quasi-oversight and its access to capital are changing in ways that make understanding sometimes inconsistent emissions data vitally important. In today’s RBN blog, we explore the recent changes and the mounting external pressures around methane emissions.
Over the past five years, the North American oil and gas industry has undertaken a major strategic shift, embracing the global push to decarbonize by, among other things, emphasizing the greener emissions profile of natural gas vs. coal and taking aggressive steps to reduce the volumes of methane, carbon dioxide and other greenhouse gases emitted during the production, processing and transportation of just about every kind of hydrocarbon. It’s a real challenge, though. Operators face a seemingly endless and overwhelming set of choices about how best to approach emissions reductions, which technologies to use, which programs to join, and how to interpret new emissions-measurement data, to name a few. In today’s RBN blog, we begin a look at how operators can achieve key environmental goals while protecting — even improving — their bottom line and meeting a host of important goals, from reducing the cost of capital and managing investor pressure to improving realized prices and market access.
The U.S. is gearing up to provide billions of dollars in financial support for a series of regional clean hydrogen hubs and had what amounts to an informal cutdown at the end of December, announcing that 33 project proponents had been formally encouraged to submit a full application this spring. Although the Department of Energy (DOE) didn’t name any of the projects on the “encouraged” list, we’ve been able to identify many of the proposals — and add five more in today’s blog — even though a lot of project details remain under wraps. In today’s RBN blog, we’ll look at the new projects on our list and examine the major factors that are likely to influence a project’s viability.
The National Environmental Policy Act was created to ensure federal agencies consider the environmental impacts of their actions and decisions, but it is the Council on Environmental Quality (CEQ), which serves as the White House’s environmental policy arm, that provides guidance as to how those agencies should evaluate the projects subject to their review. Energy and environmental policy have shifted under President Biden, and interim guidance recently submitted by the CEQ extends efforts to prioritize the administration’s commitment toward lowering greenhouse gas (GHG) emissions. Still, it’s not easy to swiftly change policy, for a variety of reasons. In today’s RBN blog, we look at the CEQ’s interim guidance and why the real-world impact on energy and environmental policy might be hard to quantify for a variety of reasons, at least in the short term.
Pretty much everywhere you look, there’s a focus on decarbonizing the global economy, and a lot of those discussions start with the transportation sector. It generated 27% of U.S. greenhouse gas (GHG) emissions in 2020, putting it at the top of the list, just ahead of power generation and industrial production; combined, the three sectors account for more than three-quarters of the nation’s GHG emissions. For personal transportation, most of the attention has been on electric vehicles (EVs), but since the commercial transportation sector is largely powered by diesel and jet fuel, the push for decarbonization in trucking, air travel, and shipping has largely focused on ways to produce alternative fuels that reduce GHGs. Among those are ultra-low-carbon fuels called electrofuels, also referred to as eFuels, synthetic fuels, or Power-to-Liquids (PtL). In today’s RBN blog, we explain what eFuels are and how they compare to other alternatives, how they are produced, and what opportunity there might be to make a dent in the consumption of traditional transportation fuels.
The Biden administration’s first foray into reducing methane emissions from oil and gas operations, released in November 2021, promised to reduce emissions from hundreds of thousands of existing sites, expand and strengthen emission-reduction requirements, and encourage the use of new technologies. It was clear about one other thing too, namely that more was already in the works. And sure enough, the Environmental Protection Agency (EPA) recently followed up with a proposal that significantly broadens the initial plan. In today’s RBN blog we look at that supplemental proposal, its targeting of so-called “super-emitters,” and why third-party groups will play a bigger role in mitigating methane emissions in the years ahead.
Natural gas pipeline project permitting sits at the nexus of the debate about the best path toward decarbonization. Industry proponents rightly point out that pipelines can reduce aggregate emissions by displacing much higher burner-tip emissions from coal in power generation. Environmental opposition, though, highlights that a high rate of methane emissions along the gas value chain could undermine those potential improvements. In today’s RBN blog, we consider the net decarbonization impact of new gas pipelines, including the importance of quantifying upstream methane emissions, by looking at a couple of canceled or long-delayed pipeline projects that could make a big difference.
Despite global energy insecurities, many countries continue to push forward with efforts to incentivize an energy transition and fulfill emission-reduction targets. Canada has been no exception, with its federal government earlier this year introducing detailed climate goals for each of its major economic sectors, with particular emphasis placed on oil and gas, the country’s largest emitter. With the aim of a 42% emissions reduction for this sector by 2030 versus 2019 levels, Canada has set a target that may well be beyond reach, raising the possibility that production cutbacks later this decade will be the only alternative. In today’s RBN blog, we examine this potentially disruptive prospect.
The recently passed Inflation Reduction Act (IRA) offers a lot of incentives, mostly in the way of tax credits, to advance the Biden administration’s clean-energy initiatives and reduce greenhouse gas (GHG) emissions. There are inducements for everything from carbon capture and electric vehicles to renewable energy and hydrogen production, but very few penalties. One exception is included in the new law’s Methane Emissions Reduction Program (MERP), which features the federal government’s first-ever fee on the emissions of any GHG. In today’s RBN blog, we look at recent attempts to mitigate methane emissions, how the new methane charge will work, and how it could one day be replaced by new federal rules.
As a piece of legislation makes its way through Congress, the name it’s given can say a lot about its overall importance and what it intends to accomplish, but also a little bit about the current political environment. Surging inflation has been one of the biggest stories of the past year and politicians of all stripes have been looking for ways to ease the pressure on consumers. Those concerns were a big reason why the Biden administration’s Build Back Better Act (BBBA), which included several climate- and energy-related measures, ultimately died in Congress late last year. The Inflation Reduction Act of 2022, which Democrats in Washington hope to pass soon, embraces the fight against inflation and includes other significant provisions, but clean energy is at the heart of the bill. In today’s RBN blog, we look at the legislation's climate and clean-energy initiatives — including a methane-reduction program, more tax credits for electric vehicles, and incentives for renewable energy and clean hydrogen — and how they would help reduce greenhouse gas (GHG) emissions.
It’s one thing if you’re 25 or 30 years old and your 401(k) is just getting started — you’ve got time to build it up, so don’t sweat it — but it’s quite another if you’re 60 or 65 and you’ve still got to sock away a lot of money before calling it quits. It could be argued that the environmental community is facing a quandary very similar to that of an aging boomer short on retirement savings. The fact is that the International Energy Agency’s (IEA’s) target of achieving net-zero man-made carbon emissions globally by 2050 in order to blunt the human impact on climate change will require massive new investment and a complete and well-coordinated transformation of the world’s energy complex. In the near-term, progress along that path must include an extraordinarily rapid ramp-up in the use of carbon capture and sequestration (CCS). And like an aging worker whose late discipline may be thwarted by an unforeseen health challenge, as we’ve seen with the recent energy crisis, there’s a lot that could derail progress toward those goals. Is the IEA's goal achievable? Maybe. But, as we discuss in today’s RBN blog, it won’t be easy.
Carbon-capture projects have begun to pick up steam in recent months, especially in the Midwest and Great Plains, with three major developments already taking shape and the potential for more. At the same time, the need to move natural gas east from the Rockies has declined over time and Tallgrass Energy Partners — a leading midstream player in that space — is looking for ways to make fuller use of its Rockies Express and Trailblazer gas pipelines. In today’s RBN blog, we look at an agreement between Tallgrass and Archer Daniels Midland (ADM) to capture and sequester carbon dioxide (CO2) emissions from a corn-processing complex in Nebraska, how that deal relies on the planned conversion of the Trailblazer Pipeline from natural gas to CO2, thought to be the first of this scale, and why Tallgrass sees potential in carbon-capture projects across the region.
Concerns about climate change have taken center stage in recent years, with the global economy under mounting pressure from governments, investors, and the wider public to reduce greenhouse gas (GHG) emissions and transition to cleaner energy sources. With the understanding that a transition will take a long time and that the world will still need oil and gas in the interim, traditional energy companies are increasingly seeking ways to clean up their current operations as much as possible. That’s where responsibly sourced gas (RSG) comes into play — natural gas that is produced, gathered, processed, transported, and distributed in a way that meets the highest environmental standards and practices, resulting in reduced GHG emissions. In today’s RBN blog we’ll look at the emergence of RSG as an important opportunity for oil and gas companies looking to be responsible environmental stewards and how Project Canary’s certification standards measure their progress in achieving those goals.
In the past few months, there’s been a flurry of interest in certified responsibly sourced gas (RSG). RSG is natural gas — it still comes out of wells in the Marcellus, Haynesville, Permian, and other U.S. production areas. What distinguishes RSG is that its producers and pipeline companies have made efforts to significantly reduce the greenhouse gases — mostly methane — that are needlessly emitted along the value chain, and that an independent and respected outsider has certified the success of these efforts. RSG is still new to a lot of folks, including those in the natural gas business, so it’s reasonable to ask, who does the certifying, and what are the differences between them? In today’s RBN blog, we continue our series on RSG with a look at the different approaches taken by RSG certifiers: Project Canary and MiQ.