On January 12th, the Biden Administration announced their proposal to add a new tax on
the fossil fuel industry related to methane emission exceedances. The EPA announcement
states that the proposed rule will assess a charge on certain emitters of waste methane
from the oil and gas sector that exceed emissions intensity levels set by Congress. The
new EPA rule was finalized in December with a stated aim “to sharply reduce methane
emissions and other harmful air pollution from new and existing oil and gas operations.”
The plans also include the Inflation Reduction Act’s Methane Emissions Reduction
Program with the Waste Emissions Charge starting at $900 dollars per metric ton of
wasteful emissions in 2024, increasing to $1,200 dollars for 2025, and $1,500 dollars for
2026 and beyond. Industry leaders are saying the new regulations go too far in punishing
producers and at a very steep rate.
