ONE Future Statement on New ICF Study
June 2, 2016
New ICF International Study: Methane Abatement Costs Higher Than Previously Estimated
ONE Future Coalition committed to reducing methane emissions; welcomes updated data on abatement costs
Washington, D.C. – A new independent assessment of methane abatement costs by ICF International concluded that the cost to reduce methane emissions from natural gas systems is $3.35/Mcf of methane reduced, nearly five times greater than previous estimates suggest.
This analysis, commissioned by ONE Future – a coalition of natural gas companies focused on reducing methane emissions – is based on a MAC curve model developed by ICF for the Environmental Defense Fund (EDF) study in 2014. ICF, in this new analysis, evaluates the economics of methane recovery at a natural gas price of $3.00/Mcf. It also uses data from EPA’s 2012 emissions inventory as well as updated cost and emission reduction data that was based on direct experience of ONE Future member companies.
“This new study provides cost estimates of methane abatement technologies that are more consistent with current market realities,” said ONE Future interim executive director Richard Hyde. “These findings will assist ONE Future member companies in our shared efforts to reduce methane emissions to less than one percent of total natural gas production.”
Importantly, this analysis updates the list of known emission abatement technologies and provides revised costs estimates for each one. It also provides estimates of the total methane emission abatement potential associated with the various segments of the natural gas industry. At its core, the study incorporates new information on the cost of methane control technologies and practices and the ability of industry to monetize recovered gas.
ICF updates costs for mitigation technologies by taking into account data provided by ONE Future members. The increased cost of methane reduction is higher than previously estimated largely due to higher assumed costs for leak detection and repair (LDAR) and revised assumptions regarding the ability of midstream segments to monetize the value of recovered gas.
Concluded Hyde, “This in-depth analysis – which incorporated field data and extensive consultation with natural gas producers, midstream operators and distribution companies – confirms ONE Future’s position that combining a performance target with a flexible pathway towards meeting the shared goal of further reducing emissions, gives companies the right tools to meet methane emissions reduction targets.”
About ONE Future. ONE Future is a coalition of companies from across the natural gas industry focused on identifying policy and technical solutions that yield continuous improvement in the management of methane emissions associated with the production, processing, transmission and distribution of natural gas. Formed in 2014, ONE Future member companies aspire to continuously improve the efficiency of the natural gas supply chain. By promoting smarter policy approaches and working to identify solutions across every sector of the industry, we can deliver better results to our customers, increase value to our shareholders, and improve our environment. Today our focus is on improving the management of methane emissions from the natural gas wellhead to the burner tip.