IRA methane emissions fee takes effect for oil and gas industry

The Inflation Reduction Act's methane emissions fee, $900 per metric ton of methane emissions above a threshold for oil and gas facilities, takes effect in 2024, rising to $1,200 in 2025 and $1,500 in 2026. It is the first time the US federal government has placed a direct charge on greenhouse gas emissions from the fossil fuel industry. The fee applies to oil and gas facilities that emit above EPA threshold levels established in the EPA's December 2023 methane rule. Industry groups argue it creates an unfair burden. Environmental groups call it a critical incentive to curb methane, a greenhouse gas 80 times more potent than CO2 over 20 years, from oil and gas operations.