Paris, Climate Progress and U.S. Natural Gas

Mark Green
Posted January 22, 2021

“The risks of climate change are real. Our companies have played and will continue to play a significant role in reducing greenhouse gas emissions (GHG) that contribute to climate change.”

– 2021 State of American Energy report

Above is a quick summary of the natural gas and oil industry’s climate position (more detail here). Basically, industry recognizes significant climate risks and is committed to working to further reduce GHG emissions – both especially relevant with President Biden’s announcement that the U.S. is rejoining the Paris Climate Agreement.

As the leading provider of the energy that powers the U.S. economy and Americans’ everyday lives, our industry has a key role to play in the national climate conversation and in developing climate solutions – even as it supports economic growth and U.S. energy security. API President and CEO Mike Sommers:

“We support the ambitions of the Paris Agreement, including global action to reduce greenhouse emissions and alleviate poverty around the globe. America’s natural gas and oil companies are part of the solution and continue to drive down GHG emissions to generational lows while investing billions in new technologies to advance further environmental progress.”

During remarks at last week’s State of American Energy event, Sommers said industry already is providing leadership on climate issues. Sommers:

“[O]ur industry is a driver of technology progress against greenhouse gas emissions, among other environmental challenges. It is our technology that is making all the difference, and we’re pointing the way forward.”

Indeed, actions – not just words – are critically important on climate. The natural gas and oil industry has been and is working to protect the environment and advance climate goals. More Sommers:

“Environmental goals are easy to declare, the more far reaching the better. But nothing is actually accomplished by announcements and agreements. Someone still has to invest the capital and do the innovating and engineering. That’s what our industry has been doing. That’s why the United States today is the world leader in reducing greenhouse gas emissions.”

In that spirit, here are three of the ways our industry can continue helping the nation achieve its climate goals.

Thanks to the shale energy revolution, wider use of natural gas in the power sector is the chief reason U.S. carbon dioxide emissions from generating electricity have fallen 33% since peaking in 2007.

No other nation has cut CO₂ emissions as much as the U.S. since 2000, according to the International Energy Agency; U.S. CO₂ emissions are at their lowest levels in a generation – again, mostly because the country is using rising volumes of cleaner natural gas in power generation.

Another way to look at the role natural gas has played in lowering emissions is seen in this from the U.S. Energy Information Administration: Since 2005, fuel switching from coal to natural gas accounted for 61% of the CO₂ emissions reductions in the power sector (CO₂ savings from natural gas dark blue bars; savings from renewables light blue bars):

Sustaining and growing domestic natural gas production can help continue this trend. We’ve seen this – natural gas is the No. 1 fuel for generating electricity in the U.S., 38% in 2019 and 41% through the first three quarters of 2020 – and need forward-looking policies that support continued natural gas development.

This is especially important for the nation’s renewable energy goals. Natural gas is the essential partner to expand wind and solar energy, providing reliable, quick-starting fuel for when the wind isn’t blowing and/or the sun isn’t shining. Natural gas has a number of unique attributes that are good for the health of the electricity grid.

Industry has and will continue to lead in using technologies and innovation, while operating under best-in-class standards, to lower methane emissions associated with natural gas and oil production.

The Environmental Partnership, whose participants represent 74% of new U.S. onshore natural gas and oil production, is focused on reducing emissions by improving equipment at industry facilities, leak detection and repair and more. The Partnership recently added flare management to its program.

In addition, API just announced its support for direct regulation of methane emissions from new and existing sources – as well as its desire to work with the new Biden administration to develop a regulatory regime that’s sensible, workable and follows the law. Regulation should promote further technological advances and innovations to further reduce emissions, even as industry provides the natural gas and oil the country needs.

Significant progress already has been seen. EPA’s latest Greenhouse Gas Reporting Program report and U.S. Energy Information Administration data show that emissions per unit of production from key basins fell nearly 70% between 2011 and 2019 – meaning that industry was increasingly efficient in reducing emissions.

Sommers writes:

We are an industry of innovators and solution-finders. We will work with the new administration and Congress where we can toward common-sense approaches that achieve what all Americans want: environmental protection and safe, secure, affordable and reliable energy.

3. By supporting increased U.S. LNG exports

Abundant domestic natural gas production has supported U.S. exports of liquefied natural gas (LNG). LNG exports provide an opportunity for friends and allies around the world to lower their emissions through increased use of natural gas. Sommers at State of American Energy:

“Late last year, U.S. LNG exports reached a record high, and they are forecast to increase 30% this year. With this breakthrough, American energy is enabling the transition to cleaner power generation and accelerating environmental progress across the world. U.S. liquefied natural gas exports are a far cleaner option for electricity generation in places like China, India, and other nations in Southeast Asia.”

API supports the ambitions of the Paris Agreement, and greater global access to natural gas, helped by U.S. LNG exports, can be part of climate progress going forward – while also helping certain countries expand access to cleaner electricity that benefits public health and improves overall quality of life. Sommers:

“Models show this agreement between nations cannot be achieved without access to natural gas, and that’s why we will continue to advocate for expanded U.S. LNG exports as a path to transition countries toward cleaner fuels while ensuring millions of people in developing nations have access to electricity.”

Again, API supports the ambitions of the Paris Agreement. And natural gas is providing golden opportunities for significant climate action and progress. Right now.

There are many people new to policymaking positions in Washington, so we’ll keep saying it to get on their radar: U.S. progress on climate, lowering emissions has been led by cleaner natural gas, and more progress is available.

We should not be so agenda-focused that opportunities are missed, today, to move the needle on climate. The environmental benefits of natural gas are not theoretical, they’re not years into the future. They’re available today. While other nations’ climate obligations under Paris remain years into the future, the U.S. has safe, abundant, affordable natural gas making a difference now.

As the new administration begins, our industry has created a strong energy foundation upon which climate goals – and so many other national priorities – can be helped. Needed is smart energy policy and regulation to foster safe, responsible domestic production. Sommers:

“President Biden … inherits a strong American energy picture – marked by low household energy costs, record emissions reductions and less reliance on foreign energy. Accelerating America’s energy and environmental progress and enabling the nation’s economic recovery will require sound and effective regulatory and other policies that protect access to affordable, reliable, and cleaner energy produced in the United States.”