Biden Imposes First Methane Emission Tax on Fossil Fuel Industry... Will Trump Repeal It?

AFP Yonhap News

The Joe Biden administration in the United States has decided to impose fees for the first time on oil and gas companies that emit methane, a major cause of global warming. However, there is a high possibility that these regulations will be repealed if President-elect Donald Trump, who has called climate crisis policies a "Green New Scam," takes office next year.

On the 12th (local time), the U.S. Environmental Protection Agency (EPA) announced the final regulations related to methane emission fees at the 29th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change held in Baku, Azerbaijan. The government will impose fees on the oil and gas industry that emits methane beyond the standards set by the government.

The fees will start at $900 per ton of methane in 2024, increasing to $1,200 in 2025 and $1,500 in 2026. Bloomberg News reported, "This is the first time such fees have been imposed in the United States." The EPA expects that imposing fees until 2035 will reduce methane emissions by 1.2 million tons, which is equivalent to taking nearly 8 million internal combustion engine vehicles off the road for one year. However, it is expected to take two years for the methane fee to take effect because the EPA must approve state regulatory plans.

The Biden administration is imposing fees on methane emissions because methane is a major contributor to global warming. According to the International Energy Agency (IEA), nearly one-third of the global temperature increase since the Industrial Revolution has come from methane. Methane breaks down faster than carbon dioxide, another greenhouse gas, but traps heat in the Earth's atmosphere at 80 times the potency of carbon dioxide, explained The Washington Post (WP). Additionally, the oil and gas industry is the largest emitter of methane in the United States.

However, there are expectations that the methane fee regulations will be repealed if President-elect Trump takes office in January next year. He has pledged to revive the fossil fuel industry and has criticized the Biden administration's climate crisis policies. Furthermore, Trump appointed his close aide, former Congressman Lee Zeldin, as head of the EPA the day before. Zeldin has announced plans for a major rollback of environmental regulations. Bloomberg reported, "The fossil fuel industry also lobbied lawmakers to classify methane emission fees as taxes and to repeal them."

The methane fee is stipulated in the Inflation Reduction Act (IRA), so it may be difficult to completely repeal the methane fee. However, since Congress has delegated detailed implementation regulations to the EPA, there is analysis that the Trump administration could change the regulations through the EPA.