Addressing methane leakages from domestically produced fossil gas, as well as from imported gas, is paramount, given that the majority of gas consumed in the European Union (EU) is imported, and that the biggest leaks happen at the extraction and production stage.

On 15 November 2023, European institutions reached a final agreement on the text of the EU Methane Regulation as part of the ‘Fit for 55’ package of legislative proposals. This marks the first EU-wide regulation targeting methane emissions, the primary component of fossil gas.

The regulation aims to track and reduce methane emissions from the oil, gas and coal sectors, both within the EU and from imported fossil fuels. It introduces new requirements for operators to measure, report and verify their methane emissions (MRV rules), and to implement mitigation measures such as leak detection and repair (LDAR) and limiting venting and flaring. Additionally, it establishes global monitoring requirements to ensure transparency and accountability of methane emissions from imports.

While the regulation is a welcome step towards a methane mitigation framework, it falls short of being ambitious enough to address the urgency and scale of the challenge. Several weaknesses and loopholes undermine its effectiveness and credibility.

Firstly, the EU is one of the largest fossil fuel consumers in the world and imports 80% of its consumption. Even though the Regulation puts in place first steps for a framework to tackle emissions from imported energy sources, these measures could be strengthened by accelerating their implementation.

The text applies a three-phase approach, which is delaying the whole process, as the first phase takes up to three years and only requires an information obligation for importers of oil and gas, on how methane emissions are reported and quantified by the producer or exporter. It does not go beyond 2027, when full MRV rules will finally be applied to importers (second phase). Finally, the real emission reduction action, ie the methane intensity target, will only be defined in 2028 and applied in 2030 (third phase), too late given the urgency of climate change.

Secondly, the regulation lacks a binding EU-wide methane emission reduction target for 2030 and fails to incorporate specific mitigation measures for imports, going beyond monitoring and reporting obligations. Furthermore, there are no concrete financial sanctions or carbon border adjustment mechanisms in place to incentivise compliance or penalise significant emissions.

Thirdly, the regulation is weakened by exemptions, especially for the LDAR rules. The regulation adopts a risk-based approach, drawing a distinction between two types of LDAR surveys, based on minimum detection limits and maximum leak thresholds. It results in reducing the frequencies of inspections to detect leaks from every four months up to every 18 or 30 months, depending on the type of components and their location.

While the regulation is a welcome step towards a methane mitigation framework, it falls short of being ambitious enough to address the urgency and scale of the challenge.

This regulatory framework lags behind international standards from the US or Canada, for example, mandating monthly or three-monthly LDAR checks. It is well established that frequent LDAR is the only proven way to avoid methane emissions, and estimates of the fraction of fugitive emissions that they prevent range between 70–80%  through quarterly inspections, and at least an additional 10% for monthly inspections.

Additionally, the inclusion of the different exemptions are in reality creating an incentive for companies to not find leaks, allowing for fewer LDAR inspections when leaks haven’t been found for some time, despite scientific evidence showing leaks to be unpredictable both in time and location.

While some significant proposals to tackle methane leakages from imported oil and gas have been included, overall the regulation fails to address the root cause of the methane problem: the continued reliance on fossil fuels, particularly gas, in the EU’s energy system. It provides the first elements of a framework for addressing imported fossil fuels, but those need to be strengthened significantly, and in the near future.

The methane intensity target kicks in too late and lacks clear enforcement mechanisms, rendering it insufficient to prevent the catastrophic impacts of methane emissions on our climate. The EU must do its homework by strengthening the implementation of the Regulation (for instance with the delegated act defining the methane intensity standard to come in 2027). Only then will it be a credible actor to use its diplomatic leverage and promote global action on methane emissions. Without forgetting that tackling methane is only a piece of the puzzle. The larger goal to achieve climate neutrality by 2040 is to phase out fossil gas fully by 2035.

The views and opinions expressed in this article are strictly those of the author only and are not necessarily given or endorsed by or on behalf of the Energy Institute.

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