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August 1 -- The Environmental Protection Agency (EPA) is proposing to amend requirements that apply to the petroleum and natural gas systems source category of the Greenhouse Gas Reporting Rule to ensure that reporting is based on empirical data, accurately reflects total methane emissions and waste emissions from applicable facilities, and allows owners and operators of applicable facilities to submit empirical emissions data that appropriately demonstrate the extent to which a charge is owed. The EPA is also proposing changes to requirements that apply to the general provisions, general stationary fuel combustion, and petroleum and natural gas systems source categories of the Greenhouse Gas Reporting Rule to improve calculation, monitoring, and reporting of greenhouse gas data for petroleum and natural gas systems facilities. This action also proposes to establish and amend confidentiality determinations for the reporting of certain data elements to be added or substantially revised in these proposed amendments. Comments must be received on or before October 2, 2023.

In August 2022, Congress passed, and President Biden signed, the Inflation Reduction Act of 2022 (IRA) into law. Section 60113 of the IRA amended the CAA by adding section 136, “Methane Emissions and Waste Reduction Incentive Program for Petroleum and Natural Gas Systems.” CAA section 136(c), “Waste Emissions Charge,” directs the Administrator to impose and collect a charge on methane (CH4) emissions that exceed statutorily specified waste emissions thresholds from an owner or operator of an applicable facility that reports more than 25,000 metric tons carbon dioxide equivalent (mtCO2e) pursuant to the Greenhouse Gas Reporting Rule's requirements for the petroleum and natural gas systems source category (codified as subpart W in EPA's Greenhouse Gas Reporting Rule regulations). Further, CAA section 136(h) requires that the EPA shall, within two years after the date of enactment of section 60113 of the IRA, revise the requirements of subpart W to ensure the reporting under subpart W (and corresponding waste emissions charges under CAA section 136) is based on empirical data, accurately reflects the total CH4 emissions (and waste emissions) from the applicable facilities, and allow owners and operators of applicable facilities to submit empirical emissions data, in a manner to be prescribed by the Administrator, to demonstrate the extent to which a charge is owed under CAA section 136.

In this action, the EPA is proposing revisions to subpart W consistent with the authority and directives set forth in CAA section 136(h) as well as the EPA's authority under CAA section 114. The EPA is proposing revisions to include reporting of additional emissions or emissions sources to address potential gaps in the total CH4 emissions reported by facilities to subpart W. These revisions include proposing to add a new emissions source, referred to as “other large release events,” to capture large emission events that are not accurately accounted for using existing methods in subpart W. Other new sources proposed to be added or included in revised existing sources include nitrogen removal units, produced water tanks, mud degassing, crankcase venting and combustion slip. The EPA is also proposing several revisions to add new or revise existing calculation methodologies to improve the accuracy of reported emissions, incorporate additional empirical data and to allow owners and operators of applicable facilities to submit empirical emissions data that could appropriately demonstrate the extent to which a charge is owed in future implementation of CAA section 136, as directed by CAA section 136(h). For example, the EPA is proposing new calculation methodologies for equipment leaks and natural gas pneumatic devices to allow for the use of direct measurement. The EPA is also proposing several revisions to existing reporting requirements to collect data that would improve verification of reported data, ensure accurate reporting of emissions, and improve the transparency of reported data. For example, the EPA is proposing to disaggregate reporting requirements within the Onshore Petroleum and Natural Gas Production and Onshore Petroleum and Natural Gas Gathering and Boosting industry segments, with most emissions and activity data for Onshore Petroleum and Natural Gas Production and Onshore Petroleum and Natural Gas Gathering and Boosting being disaggregated to at least the well-pad and site-level, respectively. The EPA is also proposing other technical amendments, corrections, and clarifications that would improve understanding of the rule. These revisions primarily include revisions of requirements to better reflect the EPA's intent or editorial changes.

FRN: https://www.federalregister.gov/d/2023-14338 [160 pages]

Proposed data collection: https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202308-2060-002 Comments due to OMB by August 31.

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