Oil and gas companies can boost profits by going green
Late last year, several of America’s most influential organizations announced a partnership to reduce emissions of methane, a greenhouse gas that contributes to climate change. The partnership is already turning heads, because its members aren’t the typical assortment of environmental groups — they’re oil and natural gas companies.
ExxonMobil, BP and other energy firms don’t often play the role of environmental crusaders. But these companies are convinced they can slow the pace of climate change while still protecting — and actually boosting — their bottom lines.
Methane is the main component of natural gas. Forty percent of methane emissions come from natural sources, like wetlands and volcanoes. But 60 percent of emissions originate from human activity, like raising livestock and producing natural gas.
Methane emissions contribute to the greenhouse effect. The gas traps 25 times as much heat in the atmosphere as carbon dioxide. If you care about the environment, and you wish to see emissions reduced, it makes sense to cultivate willing partners in the energy industry to meet those goals.
The United States has made significant progress curbing methane emissions. According to the EPA, total U.S. methane emissions dropped 16 percent between 1990 and 2015 — and emissions from natural gas production fell nearly 30 percent.
In other words, U.S. energy firms have managed to slash methane emissions even as they’ve increased natural gas production 53 percent since 1990. The main methane emitters are now located in Eurasia and the Middle East. Those regions account for nearly half of methane emissions worldwide.
But there’s still more progress to be made here in America. The American Petroleum Institute just launched the Oil and Gas Environmental Partnership. The partnership will help companies limit methane emissions during natural gas production by sharing proprietary data and best practices. It will also help companies upgrade to the latest equipment to prevent methane leaks. And it will encourage firms to increase emissions monitoring.
Energy firms aren’t undertaking these reforms solely out of environmental altruism, of course. Natural gas and oil companies have an economic interest in shrinking emissions. Partnership reforms could help firms capture more methane, resulting in a cleaner atmosphere — and an extra $1 billion in revenues for natural gas companies each year.
There’s little doubt the partnership will succeed. After all, the oil and natural gas industry has already helped slash U.S. emissions of carbon dioxide. Firms have invested almost $90 billion in zero- and low-emissions energy technologies since 2000 — nearly as much as the federal government.
That investment has yielded eye-popping results. Since 2005, U.S. carbon output has decreased by almost 14 percent. Today, emissions are at their lowest in 25 years. Technologies such as fracking and horizontal drilling have further reduced emissions by increasing the production of natural gas, which burns far cleaner than coal. According to the U.S. Energy Information Administration, 68 percent of the reduction in energy-based carbon emissions from 2005 to 2015 resulted from power plants replacing coal with natural gas and other cleaner fuel sources.
Energy firms are set to prove that it pays to go green.
Jeff Reynolds is a columnist at PJ Media and a conservationist who lives in Portland, Ore.