Following the methane waste emissions charge (WEC)’s adoption in the 2022 Inflation Reduction Act (IRA) as part of the Methane Emissions Reduction Program, the Environmental Protection Agency (EPA) finalized its implementation guidance in November 2024. As written, the fee applies to oil and gas facilities that report more than 25,000 metric tons of CO2 equivalent per year, beginning at $900 per metric ton of methane reported in 2024 and increasing incrementally to $1,500 by 2026 and beyond. (See InfluenceMap’s Methane Emissions Charge policy tracker page for an overview of how the fossil fuel industry advocated to weaken the ambition of the methane fee over the 2021-2022 time period leading up to the IRA’s passage).
In its implementation guidance, the EPA proposed three possible exemptions from the methane fee, available to companies that exceed the waste emissions threshold:
“Unreasonable delay” in environmental permitting, defined by a set of four criteria that must all be met in order to qualify for the exemption;
Regulatory compliance, for facilities that meet the methane regulation once all federal and state implementation plans have been approved, among other qualifications;
Plugged wells, only in the onshore and offshore petroleum and natural gas production industry segments, that have been “permanently shut-in or plugged” in the previous year in compliance with closure requirements.
The methane fee was written to complement the EPA’s methane regulation – finalized in December 2023 – in that companies that do not comply with the regulation would be subject to the fee. The methane reporting revisions, which were finalized in May 2024, provided assessment requirements and criteria for the methane fee.
The finalized implementation guidance for the methane fee in November 2024 appears weakened compared to the guidance proposed in January 2024. Following the comment period between January and March 2024, which received intense engagement from the oil and gas industry, the emissions netting provisions and exemption criteria have been adjusted: the final ruling allows for emissions netting at the parent company level and the scope for emissions under the plugged wells exemption was expanded. However, with Congress passing a Congressional Review Act resolution in February 2025 to overturn the final guidance, the methane fee is at risk of repeal.
AT RISK – Guidance finalized in November 2024. Congress voted to repeal the methane fee in February 2025. Additional legislation required to fully overturn the policy.
AT RISK – Guidance finalized in November 2024. Congress voted to repeal the methane fee in February 2025. Additional legislation required to fully overturn the policy.
| Influencemap Performance Band | Organization | Policy Position | Policy Engagement Intensity |
|---|
