Inspenet, August 29, 2023.
In a recent turn of events, the natural gas industry has raised red flags over a regulatory proposal submitted by the Pipeline and Hazardous Materials Safety Administration (PHMSA). This proposal, whose main objective is to strengthen measures to detect and repair leaks in gas pipelines , has been received with skepticism and concern by various key players in the energy sector.
Natural gas industry at odds
Several leading associations, including everything from the American Gas Association to the American Petroleum Institute, have consolidated efforts to present a set of recommendations that they believe would refine and improve the initial proposal. These organizations contend that the regulation, in its current form, goes beyond what Congress had envisioned for PHMSA. In addition, they criticize that the proposal lacks a detailed and rigorous analysis of the costs and benefits that its implementation would entail.
One of the most notable sticking points is how the concept of “hazardous leaks” is defined and approached. The proposed regulation does not seem to make a clear distinction between leaks of different magnitude and risk potential. This, according to the associations, could lead to inefficient management, treating minor leaks with the same urgency and resources as leaks that pose an imminent danger to the community and the environment. The associations advocate a more nuanced classification that allows prioritizing interventions according to the level of real risk.
In terms of economics, the discrepancy between PHMSA’s cost estimates and those of the industry is considerable. While PHMSA projects an annual outlay of about $14.9 million for implementation of the standard, the Interstate Natural Gas Association of America (INGAA) estimates that actual costs would range from $228 to $516 million annually . This difference highlights the need for a deeper and more collaborative analysis.
Additionally, the proposal has been criticized for its focus on reducing emissions of methane , a greenhouse gas significantly more potent than carbon dioxide. Although the intention to reduce these emissions is laudable, the associations argue that the standard, in its current form, could have the opposite effect. By requiring more frequent inspections and repairs, more emissions could be generated than are intended to be avoided.
Concluding their observations, the associations have requested a review of the implementation deadline. They argue that PHMSA’s proposed 6-month period is simply unrealistic and have called for it to be extended to 3 years to ensure a smooth and well-planned transition .
The debate is open and the industry expects its concerns and recommendations to be seriously considered. The balance between security, sustainability and economic viability is delicate, and the way forward will require dialogue and collaboration.