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POLITICS: PennAve

EPA chief to investors: We need more gas pipelines

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Politics,Energy Department,Climate Change,EPA,PennAve,Gina McCarthy,Energy and Environment,Fracking,Zack Colman,Natural Gas,PoliticsToday

Environmental Protection Agency Administrator Gina McCarthy wants energy investors to spend their dollars on building infrastructure to carry natural gas across the country.

McCarthy's pitch to the business community at a Barclays-hosted conference in New York Tuesday instead of, say, regulators or policymakers stems from the EPA having no jurisdiction over the pipes that send natural gas into homes and businesses. Federal regulations, therefore, can't address all the issues the agency sees with natural gas infrastructure, and McCarthy wants businesses to answer calls for improvements from state governments and utilities.

"This is really about building a healthy industry, a healthy investment market, and lowering carbon pollution," McCarthy said.

The United States doesn't have enough pipelines for natural gas, from the "upstream" portion that brings energy out of the ground to the "downstream" arena that pumps it into homes.

Companies in North Dakota and elsewhere have resorted to burning excess natural gas at drilling sites because there are not enough pipes nearby to send it to another location. New England has a shortage of pipelines to get fuel to customers, and the region's governors have banded together to address the issue. Under many cities, older pipelines are leaking — sending greenhouse gases, not to mention product, into the air while also posing safety risks — and must be replaced.

But all of that costs money. Marshaling private dollars to the sector would solve the financing aspect for state officials and utilities looking to make those changes — and, at the same time, those upgrades would prevent escaped emissions that contribute to climate change and lost fuel.

Methane is short-lived, but potent — up to 25 times more effective at trapping heat than carbon dioxide and comprises about 9 percent of total U.S. greenhouse gas emissions, according to agency estimates. Still, the EPA has maintained that the amount of methane that leaks during fracking is minimal.

"If the investment community invests in the future, instead of the technologies of the past; if EPA can develop its rules and develop its voluntary programs in ways that don't work counter to where the energy world is heading but actually provide the wind in the sails to that movement. Because we are in a unique moment in time, folks. I am just hoping that we seize that opportunity," McCarthy said.

Replacing aging cast-iron pipelines that run under New York City, Boston, Washington and other older cities costs between $1 million and $3 million per mile, according to Mark Brownstein, associate vice president and chief counsel of the U.S. energy and climate program with the Environmental Defense Fund.

Building infrastructure to better connect customers to areas where natural gas is being extracted is also expensive and faces intense environmental opposition.

Democratic Virginia Gov. Terry McAuliffe, for example, on Tuesday endorsed a $5 billion proposal spearheaded by Dominion Resources to build a 550-mile pipeline running from West Virginia to North Carolina. McAuliffe called it a "game-changer," but Mike Tidwell, executive director with the Chesapeake Climate Action Network, said he was "downright disappointed" that McAuliffe would support a project that would facilitate fracking.

The Obama administration has relied on natural gas to meet its climate change goals. The fuel is half as carbon-dense as coal, though environmental opponent worry that methane that leaks during fracking could erase its climate benefits.

The administration has focused recently on patching up pipelines to ensure less methane escapes into the atmosphere. The Energy Department in July proposed new regulations for units that compress natural gas and shove it through pipelines, and also asked federal grid regulators to explore crafting incentives for investing in natural gas pipeline infrastructure.

The EPA is also devising a framework for addressing methane regulations. The strategy is due in the fall, McCarthy said, though she didn't telegraph any new regulations for the sector, as some believe will be the case.

"This industry again needs investment and infrastructure that values the industry the way this administration values this industry," McCarthy said.

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