Today, the Senate approved H.J. Res. 35, a joint resolution to rescind the Waste Emissions Charge through the Congressional Review Act. The resolution, which the House of Representatives passed on Wednesday (220-206-1), now heads to the President to be signed into law. Once signed, the resolution will take effect immediately, and the Waste Emissions Charge “shall be treated as though such rule had never taken effect.”

Created by Congress in 2022, the charge imposes a fee on methane­ wasted during oil and gas production. The nonpartisan Congressional Budget Office (CBO) estimates that repealing the fee will cost American taxpayers $7.2 billion in lost revenue over the next decade (2025-2034).

Statement by Autumn Hanna, vice president of Taxpayers for Common Sense:

“The common sense methane waste emissions charge benefits taxpayers by generating $7.2 billion over the next decade, discouraging the waste of a valuable domestic energy source, creating jobs in methane mitigation, and reducing pollution. Repealing this modest fee on excess waste in the oil and natural gas industry is fiscally irresponsible.”

Background

Methane waste during oil and gas development deprives consumers of a valuable energy resource, costs taxpayers billions in potential revenue, and forces communities to shoulder costly liabilities. The oil and gas industry routinely wastes methane through venting (the intentional release of natural gas), flaring (burning natural gas), and leakage. In 2019, approximately $509 million worth of natural gas—enough to meet the annual energy needs of 2.2 million households—was lost on federal and tribal lands. This wasted gas resulted in a combined loss of $64 million in federal, tribal, and state royalty revenues.

The oil and gas industry has cost-effective tools to minimize this waste. A 2010 Government Accountability Office study found that 40% of vented and flared gas could be profitably captured using existing technology. The U.S. methane mitigation industry has grown significantly in recent years, with an 88% increase in manufacturing firms and a 105% expansion in service providers since 2017, creating more than 1,040 job locations nationwide.

Under the final Waste Emission Charge rule, large oil and gas facilities—from production to transportation to processing­—that emit more than 25,000 metric tons of carbon dioxide equivalent of greenhouse gases annually are assessed a fee for any methane wasted beyond a congressionally-set threshold. Fewer than 500 oil and gas facilities are expected to be subject to the charge.

The Environmental Protection Agency projects the Waste Emissions Charge will generate $2.3 billion from 2024 to 2033. The CBO projects the fee will generate even greater receipts for federal taxpayers, estimating that repealing the fee through H.J. Res. 35 would reduce federal revenue by $7.2 billion over the next decade.