ERM Client Alert: Revisions to Subpart W - GHG Reporting for Petroleum and Natural Gas Systems
20 December 2011
The rule changes are in place and the reporting deadline is set. It is time to get to work on Subpart W. The latest revisions represent significant changes to emission factors, facility boundary definitions, applicability of source types, calculation methods, input data parameters, BAMM provisions, and aggregation levels – all effective for the 2011 reporting year.
On November 29th and December 2nd, the US Environmental Protection Agency (EPA) finalized important changes to the Greenhouse Gas (GHG) Reporting Rule for Oil and Natural Gas Systems (40 CFR 98, Subpart W) along with some specific requirements for Subpart A. The rule updates are intended to clarify facility boundaries and reporting requirements, and allow additional flexibility to reporters.
Changes have also been made to certain calculation methods and input parameters that could significantly impact data collection strategies. A new “sub-basin” concept based on counties and formation levels is introduced for measurement requirements which poses major implications for aggregation of field data in the onshore production segment. On-shore production facilities that were previously below the reporting threshold should review their applicability determinations due to changes to emission factors.
What Steps Should Reporters Take?
- Reassess Scope: Reporters will need to carefully analyze the rule revisions and revise previous facility boundary determinations (e.g. new definition of associated with single well-pad for the onshore production segment), re-orient data collection frameworks, and revisit inventories of sources subject to reporting.
- Revisit Compliance Gaps: Analyses conducted previously to assess gaps between rule requirements and existing data collection and quality assurance procedures will need to be revisited to identify any new gaps that may emerge. Additional data collection, aggregation, and quality assurance practices may need to be implemented to address new gaps. Onshore production facilities previously assessed to be below the reporting threshold should confirm rule applicability.
- Revise Monitoring Plans: Existing GHG Monitoring Plans in most cases will need to be updated to represent revised calculation methods and the corresponding changes to data collection and quality assurance procedures.
- Revise Calculation Tools: Tools developed to calculate GHG emissions and house input data will need to be revised to incorporate changes to calculation methods and corresponding data collection procedures.
- Prepare 2011 Report: The reporting deadline for Subpart W facilities was extended from March 31, 2012 to September 28, 2012. The Subpart W e-GGRT module is not yet available, but collecting and organizing all the data and tabulating emissions in accordance with the rule will easily consume months of time. Waiting for e-GGRT is not an option.
Transitioning from BAMM to Full Compliance
Many Subpart W reporters are currently using the provisions for Best Available Monitoring Methods (BAMM) for data collection for reporting year 2011. Submittal of a notice of intent by January 3, 2012 and a complete BAMM extension request to use BAMM for reporting year 2012 will automatically extend the use of BAMM through end of June 2012. The complete 2012 BAMM extension request is due at the end of March 2012 and must include full justification for any remaining gaps and obstacles that prevent complying with the revised rule. Companies will have to “wean” themselves off of the BAMM provisions eventually and fully comply with all of the monitoring provisions in the rule by no later than reporting year 2013.
What are the Major Rule Revisions?
- Clarification of definitions for onshore production, processing, and transmission compression to assist in determining applicability - including exclusion of emissions from sources at comingled/central facilities not on a well pad for onshore production
- Exemption threshold of 1 mmBtu/hr for internal combustion engines (not compressor drivers) in the onshore production and natural gas distribution segments
- Updates to emission factors (increases in some cases), equations, and variables; clarification of definitions for key terms
- Replacement of “EIA field” with "Sub basin” as the aggregation level for monitoring and reporting purposes for several onshore production sources – sub basin defined in terms of counties and hydrocarbon formation types
- Permitted use of company records for flow meter calibration of combustion sources in the onshore production segment
- Reconciliation of “owner/operator” definition for onshore production for Subpart A purposes
- Updated several emission factors to reflect standard temp. of 60 deg.F instead of 68 deg.F