As he nears the end of his presidency, Obama is increasingly attempting to regulate and control the American economy. Obama seeks to use executive agencies to push his agenda and circumvent Congressional approval. This regulatory zeal most harshly manifests itself in the EPA.
This year alone, the EPA has released a variety of new regulations such as the Clean Power Plan, Ozone Standard, and the Waters of the U.S. Rule. Once again the EPA proves its appetite for more regulations with a new rule that limits methane emissions.
The EPA’s new regulation aims to cut methane emissions by 45% by 2025. According to the EPA’s own estimates, this new rule will cost $180 to $200 million in 2020, with costs possibly reaching $500 million in 2025.To achieve its goal, the EPA is expanding its regulatory powers over a vast array of equipment not previously under its control. Under the EPA’s expanded powers, energy producers will be forced to install highly expensive equipment on new operations, the costs of which will inevitably be passed onto consumers in the form of higher energy rates.
These new rules would especially harm the boom in natural gas production the U.S. has experienced through hydraulic fracturing, which has created huge economic growth in the past few years. In 2012 alone the industry boosted the economy by $284 billion and supported over 2 million jobs. The new set of EPA rules threatens to stymie such momentous economic growth
Additionally, the EPA’s methane rule is a regulation in search of a problem. In recent years the energy industry has continuously decreased methane emissions through its own initiatives, even as gas production has increased 44%. Since 2011, methane emissions from the oil and natural gas sector have decreased by 12%, with the largest reductions coming from natural gas recovery sites, which have decreased methane by 73%. The industry accomplishes this feat through investment and innovation in new technology. Because of such innovation, researchers estimate that less than 2% of methane is lost during natural gas production.
The EPA’s one size fits all approach to regulation is inefficient. The energy industry is complex and varies greatly across different operations. The industry’s efforts to reduce methane emissions, without directly regulating methane, dwarf the emission reductions EPA has estimated in their rules. The bureaucrats at the EPA simply cannot match the expertise and knowledge of industry experts.
The new methane rule is yet another attempt of the Obama administration to further regulate the booming energy sector. Given the energy industry’s continued ingenuity and success in reducing methane, this regulation is wholly redundant.
The EPA’s methane rule is unnecessary and simply a regulation for regulations sake. This rule follows a long line of regulations that limit growth and undermine the free market. It is evident that the EPA is on a quest to control the economy, picking winners and losers through senseless overregulation.
Photo Credit: Chesapeake Bay Program