Colorado officials are advancing rules to cut carbon emissions in yet another sector — this time in the midstream sector of the oil and gas industry, a battleground area in which both industry and environmental leaders worry already about the proposed regulations.
The midstream sector is comprised of the pipelines and facilities that transport natural gas from wells to the transmission companies that distribute it to power plants and homes. A key part of the sector — which is made up in Colorado of three major players and a couple dozen smaller companies — is the compression plants that keep the gas moving down long pipelines to its destinations.
As part of efforts to reduce greenhouse-gas emissions by 2030, state officials have put rules into place already for sectors ranging from manufacturing facilities to large commercial buildings to gas-powered lawn equipment. They have developed rules both for upstream oil-and-gas well production facilities that extract the resources from the ground and for some midstream oil-and-gas facilities, but these new rules are aimed specifically at what is called the industrial sector of the industry.
The rules for the industrial midstream sector have been in development for nearly three years because it is considered one of the more difficult areas to decarbonize. Compressor stations and gas-processing plants are often in remote locations that require new power lines be run five to 10 miles to them to handle the load for electronification efforts — which could only come if companies replace or retrofit large and expensive engines and boilers.
How the emissions cuts would work
Under the proposed rules, which will get a formal hearing before the Colorado Air Quality Control Commission from Dec. 18-20, midstream operators must reduce emissions 22% from 2015 levels by 2030 — a goal higher than the 20% yardstick originally considered. While the goal is sectorwide, specific emission caps would be determined on a company-by-company basis explained Stefanie Shoup, manager of the Colorado Department of Health and Environment’s office of innovations in planning and air-quality assessment.
Division leaders want to create a carbon-credit-trading program similar to that which they are developing for the manufacturing sector. But they also want to mandate companies with facilities in disproportionately impacted communities to cut emissions within those poorer or more polluted communities by at least 20% before using the new credits.
The goal, Shoup told AQCC members before they voted Thursday to set the December hearing date, is to achieve emissions reductions in the communities where they are most needed and to do it in a way that is cost-effective and technically feasible. The rules, she added, should include provisions limiting penalties for scenarios that are outside of an operator’s control, such as a utility’s inability to build power lines needed for electrification out to a plant in a timely…
Read More: Colorado offers proposed emissions-cutting rules for key energy sector
