* Some critics see emissions gap in EU climate regulations
* EU has no plans to set standards for gas imports - draft
* GRAPHIC-EU gas imports by origin: https://tmsnrt.rs/2Wnn3ca
By Kate Abnett and Shadia Nasralla
BRUSSELS, July 17 (Reuters) - The European Union does not
plan to crack down on planet-warming methane emissions from gas
imports despite pressure from oil companies, activists and
academics, according to its draft strategy and sources familiar
with the matter.
While the EU plans to impose carbon dioxide (CO2) taxes on
imports of energy intensive goods, critics say the world's
biggest gas importer is not targeting suppliers of the fuel hard
enough in its methane strategy due to be unveiled this year.
This comes despite an unlikely alliance of big oil firms,
environmental activists, investors and researchers pushing the
bloc to plug this hole in its methane plan and punish gas
producers that fail to rein in their emissions.
While the EU regulates methane emissions from gas burned in
the bloc, it doesn't regulate emissions during the production or
transport of gas imported by Europe. That means those emissions
don't show up in the tally of greenhouse gases linked to
Europe's gas-fuelled power plants, nor are they are counted in
the EU's climate goals.
The draft methane plan, which may be subject to change, says
the European Commission will propose legislation requiring gas
firms to better monitor and report methane emissions, but it
does not include setting methane standards for imported gas.
The Commission, the European Union's executive, declined to
comment on unpublished documents.
Campaigners say the omission of imported emissions risks
undermining the EU's climate policy as methane is 100 times more
potent than CO2 when it first goes into the atmosphere.
"Setting clear product standard requirements on all gas sold
in the EU's internal market is essentially a global climate
opportunity with significant potential to curb global methane
emissions from oil and gas quickly," said Poppy Kalesi, global
energy policy director at the Environmental Defense Fund (EDF).
It teamed up with seven European oil firms - BP, Eni
, Equinor, Repsol, Royal Dutch Shell
, Total and Wintershall DEA - to ask Brussels
to address what they see as a blind spot in its climate plans.
Sources familiar with the Commission's thinking say it has
not shifted its position on regulating methane emissions from
imported gas since compiling the draft.
Gas production is associated with emissions of methane,
which leaches into the atmosphere from leaky pipelines and
infrastructure at oil and gas fields.
The EU imported about 80% of the gas it consumed last year.
Almost three-quarters of its imports came from Russia, Norway
and Algeria, with Russia's Gazprom by far the biggest
non-EU supplier.
Methane is 100 times more powerful than CO2 as a global
warming gas, but it degrades while CO2 remains in the
atmosphere. Over a 20-year period, methane is 86 times more
powerful though that drops to 34 times over 100 years.
SATELLITE FINDINGS
Analysis of satellite imagery and other aerial surveillance
over the past few years has shown that oil and gas industry
leaks are responsible for far more of the methane in the
atmosphere than previously thought.
The Institutional Investors Group on Climate Change, whose
members have 30 trillion euros ($34 trillion) of assets under
management, wrote to the Commission in May asking it to propose
rules this year to ban gas with a methane leakage rate in
upstream supply chains of more than 0.25% by 2025.
U.S. lobby groups EDF and the Rocky Mountain Institute, the
Florence School of Regulation research centre and the European
oil companies also wrote to the Commission in May, recommending
"a methane intensity-based performance standard applied to the
upstream segment of the supply chains from 2025".
Their letter called for: "A procurement standard to be
applied from 2025 to incentivise the continual reduction of the
methane emissions intensity of the gas entering domestic and
import supply chains."
A Commission official said by focusing its proposals on
monitoring and reporting emissions, the aim was to get a handle
on the issue.
"The main thing is to get a good picture of where the
methane is actually coming from," the official said, speaking on
condition of anonymity.
Campaigners fear this approach could delay plans to regulate
imported emissions and say there is sufficient data to design
such policies.
Andris Piebalgs, professor at the Florence School of
Regulation and a former EU energy commissioner, said any
indication that Brussels will integrate international methane
emissions into its policy would be a substantial step forward.
"Because at this stage, it's not ... much discussed at all."
For European oil and gas firms, tackling methane emissions
could help them make the case that gas can play a role in
Europe's shift to "net zero" emissions by 2050 at a time when
investors are increasingly focused on their climate performance.
European oil companies that have invested to curb their own
methane emissions may also be wary about being undercut by
producers outside the bloc who haven't done the same.
BENEFIT WIPED OUT
Gas is far from being a zero emissions fuel but it produces
roughly half the CO2 emissions of coal when burned in power
plants and is seen by Eastern European countries such as Poland
as a transition fuel to wean themselves off coal.
But methane leaks can quickly dent this argument.
"When you get to about 3% leakage, the entire benefit of gas
as a lower-emissions fuel is entirely wiped out. So we're
operating in a relatively small window of gas actually being
better than coal," said Frank Jotzo, director of the centre for
climate economics and policy at Australian National University.
The International Energy Agency says a third of methane
emissions from the oil and gas industry could be saved at no net
cost, as the captured gas could be sold.
However, EU methane standards for gas imports could rile
large suppliers, especially if it restricts their access to the
European market.
"As 40% of EU gas imports stem from Russia, dealing with
methane emissions means dealing with Gazprom," said Esther
Bollendorff, EU gas policy coordinator at the non-profit Climate
Action Network, referring to Russia's state-owned gas producer.
Gazprom is Europe's largest gas supplier and owns
pipelines transporting the fuel to Europe. Last year, it sold
almost 200 billion cubic metres of gas to countries in Europe
and Turkey.
In a June 10 statement about emissions, Gazprom estimated
that 0.29% of the 679 billion cubic metres of gas it moved
through its pipelines escaped as methane in 2019 and said this
corresponded to the best global practices.
Some observers said the slump in EU gas consumption this
year during coronavirus lockdowns meant the bloc was less
dependent on gas suppliers and was in a stronger position to
push them to tackle methane emissions.
"The EU has the power now," said Lisa Fischer, senior policy
adviser at the climate change think-tank E3G.
($1 = 0.8749 euros)
(Reporting by Kate Abnett and Shadia Nasralla; Editing by David
Clarke)
