EPA s Proposed GHG Reporting Rule: Oil and Natural Gas Systems Presented to the Wyoming Pipeline Authority Quarterly Public Meeting Tuesday, May 19 th, 2009 Casper, Wyoming
Outline of Presentation Regulatory background General information on EPA GHG rule EPA GHG rule specific to Oil and Gas Systems Review of applicable subparts Missing data Recordkeeping Topics for Commenting Summary
How it All Got Started: Massachusetts et al. vs. EPA (April 2007) Greenhouse gases are air pollutants CAA does give the EPA the authority to regulate tailpipe emissions of GHG GHG fit well within the CAA capacious definition of air pollutant EPA must consider endangerment (1) Make a positive endangerment finding; (2) Make a negative endangerment finding; or (3) offer a reasonable explanation as to why it cannot or will not exercise its discretion to determine whether they do. **This ruling opened the door to regulation of GHG under Section 202 of CAA**
Draft EPA Endangerment Finding (April 17, 2009) Endangerment: EPA declared CO 2 a danger to public health and welfare Cause and Contribute: Emissions from cars contribute to atmospheric levels of GHGs National GHG plan vs. regulate under existing laws Public comment period: June 23, 2009 **Likely increase pressure on Congress to adopt federal GHG regulations.**
The First Step: EPA GHG Proposed Reporting Rule As required by the FY2008 Consolidated Appropriations Act EPA Draft Rule March 10, 2009, published in Federal Register on April 10, 2009 Comments on proposed rule June 9, 2009 EPA Target for Final Rule: Late Fall 2009 EPA estimates 13,000 affected facilities (large emitters) ~85 % of GHG s Includes energy intensive sectors: cement production, iron and steel production, electricity generation, refineries, and oil and natural gas (NG) Systems
The First Step: EPA GHG Proposed Reporting Rule Annual monitoring and reporting of GHG Facility Level** First Report: 2011 reporting of 2010 emissions Certification: GHG report shall be submitted, signed and certified by a designated representative Penalties (CAA): Up to $32,500 per day per violation, Criminal penalties are also possible EPA estimated cost to comply (all private sectors): ~$160 million for the first year, ~$127 million in the following year ($0.04 per tonne CO 2 e)
Key Definition: **Facility any physical property, plant, building, structure, source, or stationary equipment located on one or more contiguous or adjacent properties in actual physical contact or separated solely by a public roadway or other public right-of-way and under common ownership or common control.
The Specifics: Oil and Natural Gas Systems Must report if total GHG emissions 25,000 tonnes CO 2 e/year Gasses covered: CO 2, CH 4, N 2 O Once in always in Includes: Offshore production facilities Onshore gas processing facilities Onshore gas transmission compressor facilities Gas storage facilities LNG storage facilities and import/export facilities **Notable exclusions (for now): Onshore petroleum and natural gas production and pipeline segments for NG and crude, NG distribution, crude oil distribution
The Nuts and Bolts: Applicable Subparts W - Oil and NG Systems (fugitives) A - General Provisions C - Combustion Sources NN - Suppliers of NG and NGLs PP - Suppliers of CO 2 And Others
Key Definition: Fugitive Emissions (IPCC 2006) Unintentional equipment emissions and intentional or designed releases of CH 4 and/or CO 2 -containing NG or hydrocarbon gas from emission sources including but not limited to: Open ended lines Equipment connections or seals to the atmosphere Combustion of NG in flares
Subpart W: Oil and Natural Gas Systems Fugitive and process emissions only (24 identified emission source types) Required to detect emissions Required to calculate emissions: Using direct measurement Engineering measurements (AGR, NG driven pneumatic pumps, NG driven pneumatic manual valve actuator devices, NG driven pneumatic valve bleed devices, blowdown vent stacks, dehydrator vent stacks) Engineering/direct measurement (flare stacks, storage tanks, compressor wet seal degassing vents)
Subpart W: Detection and Calculation Annual leak detection for all sources must be comprehensive Detection: Optical (infrared or laser), or OVA/TVA type analyzers allowed Quantification: Leak measurement required for subset of components generally all traditional fugitives High-flow sampler required unless they cannot capture the total leak Calibrated bags (required in some instances) 3 runs required Route to stack/pipe and use velocity meter
Subpart W: Reporting Fugitive emissions aggregated for each source type (ex. emissions from all pumps combined) Quantity of CO 2 captured for use and the end use, if known Fugitive emissions from standby sources would be separately identified Activity data for each aggregate source type level
Subpart C: Combustion Sources Stationary fuel combustion sources are devices that combust any solid, liquid, or gaseous fuel to: Produce electricity, steam, useful heat, or energy for industrial, commercial, or institutional use Reduce the volume of waste by removing combustible matter Includes: boilers, combustion turbines, engines, incinerators, and process heaters, etc. (units) Excludes: portable equipment or generating units that have been designated as emergency generators (based on permit), and flares Report total CO 2, CH 4, and N 2 O emissions from each fuel combustion unit and for each type of fuel combusted Report CO 2 emissions from sorbent use in air pollution control equipment
Subpart C: Calculation and Monitoring Methodology Calculation methodology - a fourtiered approach (subject to restrictions based on unit size and fuel). Tier 1: Emission factor that is multiplied by annual fuel use and a default HHV/LHV Tier 2: An emission factor that is multiplied by annual fuel use and a measured HHV/LHV Tier 3: Annual fuel use and measured carbon content Tier 4: Continuous emissions monitoring systems (CEMS)
Subpart C: Calculation Hierarchy Is the max. rated heat input capacity > 250 MMBtu/hr or does the unit have a max. rated input capacity of 250 tons/day of municipal solid waste (MSW)? NO Does the unit have a Are solid fossil fuel or MSW YES CEMS that is required, YES the primary or secondary fuel YES certified, and undergoes sources and has the unit periodic quality assurance testing? operated more than 1000 hrs/year since 2005? NO Tier 4 Does the unit have both stack gas volumetric flow rate and CO 2 concentration monitors? YES Tier 3 NO NO Is the fuel s HHV determined on a monthly basis? Note: Data may be provided by a fuel provider? NO Are default HHV and CO2 emissions factors available in Table C-1 fro the fuel combusted? YES NO Is a default CO2 emission factor available in Tables C-1 or C-2 for the fuel combusted? NO Tier 3 YES Tier 2 DATA REQUIREMENTS Tier 1 - Annual Fuel Consumption Tier 2 - Tier 1 + measured HHV YES Tier 3 - Tier 1 + measured carbon content Tier 1 Tier 4 -CO 2 CEMS data
Subpart C: Reporting Annual mass emissions for each GHG for each unit Some emissions can be aggregated: Small units that have a combined max. heat input capacity of 250 MMBTU/hr Units that share a common stack and use CEMS Units that combust the same fuel and is metered through the same pipe Measured inputs Certification tests and major QA tests for CEMS
Subpart NN: Suppliers of NG and NGLs suppliers of natural gas and natural gas liquids would report the emissions that would result from the complete combustion or oxidation of the products that they place in commerce. Suppliers include: NG processing plants: CO 2 emissions from the complete combustion or oxidation of the annual quantities of propane, butane, ethane, isobutene, and bulk NGLs sold or delivered for use off site Local distribution companies: Report CO 2 emissions from the complete combustion or oxidation of the annual volume of natural gas provided Calculations: Uses either a measured or default CO 2 emissions factor Reporting: Annual volume of natural gas received for delivery to various end users and the associated GHG emissions.
Subpart PP: Suppliers of CO 2 Facilities with production process units that capture and supply CO 2 for commercial applications Facilities with CO 2 production wells Importers of bulk CO 2, if total combined imports of CO 2 and other GHGs exceed 25,000 tonnes of CO 2 e/year Exporters of bulk CO 2, if total combined exports of CO 2 and other GHGs exceed 25,000 tonnes CO 2 e/year Exclusions: entities that store CO 2 through geologic sequestration or above ground storage; use CO 2 in enhanced oil and gas recovery; transport or distribute CO 2 ; purify, compress, or process CO 2 ; or import or export CO 2 in equipment.
Subpart PP: Reporting and Monitoring Monitoring: Suppliers would calculate emissions quarterly by measuring the mass flow of gas and multiplying by the CO 2 composition of the gas Reporting: Total annual mass of CO 2 The weighted average composition of the CO 2 stream captured, extracted, or transferred Annual amounts of CO 2 transferred to the appropriate end-use applications
Missing Data (all subparts) Subpart C: Allows for averaging, other methodology outlined in the rule Subpart W: If data is lost or there is an error, data must be collected again Subpart NN: Allows for substitution of data using the methodology outlined in the rule Subpart PP: Allows for substitution of data using the methodology outlined in the rule
Record Keeping (5 years) (all subparts) List of units, operations, processes, and activities The data used to calculate GHG from each emission source for each subpart Documentation of data collection process GHG methodology and calculations Name of personnel ANNUAL GHG emissions report Missing data computation A written QAPP Log book documenting procedural instrumentation and/or instrumentation readings Additional information applicable to each subpart
Topics Suggested for Commenting. 3 rd party verification vs. self-certification Time frames alternatives for 2010/2011 reporting option: 2011 on best available data basis 2012 for 2011 Reporting of indirect emissions (scope 2) Source specific CH 4 and N 2 O factors for combustion sources Use of a basin approach for onshore petroleum and NG production Methodology for measuring and quantifying fugitive emissions Confidential Business Information Definition of facility and fugitives
Summary: GHG Reporting Rule Massive Rule (~285 pages in Federal Register and 42 subparts) Does not trump state and/or regional rules already in place Final rule likely in November 2009 Effective January 1, 2010 First annual report is due March 2011 Comment period is open until June 9, 2009 Applicable subparts: W, A, C, PP, NN, and others Submit report and supporting documentation to EPA All will be public More to come..most likely first step in mandatory regulation of GHG. Ex. Cap and trade? Carbon tax?