New Analysis Quantifies Natural Gas Waste and Pollution in Texas

(San Antonio, TX – July 26, 2023) A new Synapse Energy Economics analysis commissioned by Environmental Defense Fund and Taxpayers for Common Sense finds that oil and gas companies across Texas wasted over $1.7 billion worth of natural gas in 2019. That’s enough lost gas to meet the state’s entire residential natural gas demand twice over, totaling $128 million in lost potential revenue for both the federal and state governments. 

This waste occurs when natural gas is flared, vented or leaked from oil and gas infrastructure, and the analysis comes as the U.S. Environmental Protection Agency moves to finalize rules to address methane pollution from oil and gas facilities nationwide. These national rules provide significant upside for states like Texas, where wasted taxpayer resources could be saved with stronger standards for oil and gas operators. 

Watch: Infrared video shows methane gas being released from unlit flares at oil and gas sites across Texas.  

"This analysis shows how critical reducing methane waste and pollution is for Texans," said Elizabeth Lieberknecht, EDF Regulatory & Legislative Manager, Midcontinent. “We urgently need the EPA to finalize its rules to cut methane pollution, especially from the wasteful practice of routine flaring. Strong standards will create jobs and increase revenue for state priorities like education while curbing harmful pollution and strengthening climate security.” 

Methane is a potent greenhouse gas with more than 80 times the warming power of carbon dioxide over a 20-year timeframe and is often accompanied by other local air pollutants. Because methane is the main component of natural gas, it also represents a waste of an energy resource when it is released from the supply chain. 

According to the analysis, the 564 billion cubic feet of methane wasted from Texas’ 294,000 active wells translated into nearly $128 million in lost tax and royalty revenue to the state of Texas in 2019 alone. This lost funding could support Texas’ education system, Rainy Day Fund and the state Highway Fund. Instead, methane and air pollution are released into the atmosphere, harming our climate and hurting public health. 

"We are wasting a valuable domestic energy resource every day. This is true in Texas and across the country. Billions of dollars’ worth of natural gas isn’t getting to market at a time when energy security is important as ever,” said Autumn Hanna, Vice President at Taxpayers for Common Sense.   

This analysis also shows how flaring is a leading cause of wasted gas, responsible for roughly 55% of all methane wasted in Texas in 2019. Operators in Texas flared more than $929 million worth of natural gas in just one year.  

While volumes of flared gas in Texas have decreased in recent years, operators still flare significant volumes of gas. And without strong requirements in place in Texas, there is currently nothing to stop another run up in flared volumes when market forces dictate. This underscores the importance of EPA regulatory action and strengthened standards in a final rule to eliminate pollution from routine flaring to keep this resource out of the atmosphere and in the pipeline. Colorado and New Mexico have already implemented strong rules to stop pollution and waste from routine flaring, creating an important foundation for federal agencies to build upon in developing standards that serve the needs of Texans. 

“Our state oil and gas oversight agency, the Railroad Commission of Texas (RRC), has failed to rein in routine venting and flaring. Climate pollution like this is making Texas hotter and drier, affecting our agriculture sector and making outdoor work more risky. We need strong federal rules in place to stop these emissions faster, because the RRC isn't doing enough,” said Virginia Palacios, Executive Director of Commission Shift. 

Cutting methane waste and pollution from the oil and gas sector will not only reduce energy and economic waste but will also protect communities and increase climate security. Alongside methane, oil and gas production sites emit smog-forming volatile organic compounds and health-harming hazardous air pollutants. Texans across the state are already experiencing the impacts of climate change, such as exacerbated heat waves and prolonged drought.  

“Methane waste and pollution have detrimental effects on communities in Texas,” said Sheila Serna, Climate Science and Policy Director at Rio Grande International Study Center. “When oil and gas operators are allowed to waste natural gas, communities not only lose out on potential revenue but are also impacted by the adverse health and climate impacts of the industry’s pollution.” 

Reducing methane waste and pollution also creates jobs in the fast-growing methane mitigation industry. According to Datu Research, the sector already has 55 locations across Texas, manufacturing products and providing services to help operators curtail emissions. The methane mitigation industry provides family-sustaining jobs that typically pay 10% more than the federal average and can’t be offshored. Over 75% of methane mitigation companies say they would create more jobs with strengthened methane emission standards in place. 

Additionally, reducing the needless waste of gas resources lost through methane waste is an important solution for addressing the joint energy and climate security challenges of the U.S. and its allies as we transition away from fossil fuels to a clean energy future.