The United States is now the world’s largest producer of natural gas. This natural gas revolution is driving economic growth across the country, lowering energy prices and creating jobs. It has also contributed to an American manufacturing renaissance. As the President noted in the State of the Union address, American businesses plan to invest almost $100 billion in new factories that use natural gas.
Since 2007, we have seen a 10 percent decline in carbon emissions. About half of that is due to efficiency gains and growing electricity generation from natural gas.
However, methane, the main component of natural gas, is both a potent greenhouse gas as well as a valuable energy resource. Every day, methane escapes from natural gas transmission, storage and distribution infrastructure, costing both the natural gas industry and consumers money and raising safety concerns. Reducing these methane leaks can help consumers and industry save money, create jobs, modernize our energy infrastructure and protect our environment.
As part of his Climate Action Plan, President Obama called for a comprehensive, interagency strategy for cutting methane emissions. Since then, the Department of Energy (DOE) has hosted a series of roundtable discussions with government, industry, non-profit, union and environmental leaders to help identify opportunities, share technical solutions and coordinate best practices to reduce these emissions.
Today, after the final roundtable discussion, DOE announced steps to help modernize the nation’s natural gas transmission and distribution systems in ways that will enhance competitiveness and safety and mitigate methane emissions. As part of the overall Administration’s methane strategy, the Energy Department’s Initiative to Help Modernize Natural Gas Transmission and Distribution Infrastructure includes:
- Efficiency Standards for Natural Gas Compressors -- DOE will begin the process of establishing energy efficiency standards for new natural gas compressor units, which are currently estimated to consume more than 7 percent of natural gas in the U.S. Improved efficiency will help provide energy savings for consumers and reduce greenhouse gas emissions.
- Advanced Natural Gas System Manufacturing -- In collaboration with industry, the Department will evaluate and establish a high-impact manufacturing research and development initiative to improve natural gas system efficiency and leak reduction.
- Incentives for Modernizing Natural Gas Infrastructure -- Following discussion with Chair Cheryl LaFleur, I have recommended that the Federal Energy Regulatory Commission look at ways to provide greater certainty for cost recovery for new investment in modernization of natural gas transmission infrastructure.
- Encouraging State Leadership for Efficient Distribution -- The Energy Department will join the National Association of State Regulatory Utility Commissioners in a technical partnership to better enable investments for infrastructure modernization and repairs to natural gas distribution networks, with DOE providing grant funding and technical assistance to help inform decision-marking by state utility commissioners.
As part of the President’s Climate Action Plan, the Administration is currently carrying out the Quadrennial Energy Review, a policy planning effort to develop a comprehensive blueprint for meeting our 21st century energy challenges. The first installment of the QER is focused on the issues of transmission, storage and distribution infrastructure across the energy sector, including the issues of associated methane emissions.
We are currently hosting stakeholder meetings across the country to engage the public in the Quadrennial Energy Review. I encourage you to join us at one of these meetings, or to submit your comments online.