IEA (2021), Curtailing Methane Emissions from Fossil Fuel Operations, IEA, Paris https://www.iea.org/reports/curtailing-methane-emissions-from-fossil-fuel-operations, Licence: CC BY 4.0
Methane has contributed to around 30% of the global rise in temperatures to date, and curbing these emissions is the most effective means available for limiting global warming in the near term. Emissions from fossil fuel operations present a major opportunity in this respect, since the pathways to reduction are both clear and cost-effective. Fossil fuel operations generated close to 120 Mt of methane in 2020 – nearly one-third of all methane emissions from human activity. The scope for reducing these emissions is enormous. This is particularly true in the oil and gas sector, where it is possible to avoid more than 70% of current emissions with existing technology, and where around 45% could be avoided at no net cost.
Reducing fossil fuel demand alone will not do the job quickly or effectively enough, which means early and concerted abatement efforts by governments and industry are essential. Under the IEA’s Net Zero Emissions by 2050 Scenario, methane emissions from fossil fuel operations would need to fall by around 75% between 2020 and 2030. Only about one-third of this decrease is the result of reduced consumption of fossil fuels, principally coal. Most of the decline comes from the rapid deployment of measures and technologies to eliminate avoidable methane emissions by 2030.
A number of countries have already shown leadership through ambitious policy commitments on methane. Some have included methane alongside other greenhouse gases as part of their national net zero pledges, while others have set dedicated targets like the new Global Methane Pledge, led by the European Union and the United States. Cutting methane emissions from fossil fuel operations can, and should, play a central role in national efforts to meet these goals.
In this analysis, we identify the practical steps that can be taken by countries and companies to secure a 75% reduction in emissions from fossil fuel operations. Building on the estimates of emissions and abatement options in the IEA Methane Tracker, we quantify the potential impact of a range of measures, including policy and regulatory action, voluntary industry initiatives, and improvements in the transparency of emissions data. By identifying the different measures and approaches, this analysis aims to provide insights and guidance for decision makers in the lead-up to COP26 and beyond. This is a crucial decade for action. It is vital that immediate steps be taken to cut emissions of both methane and CO2 to keep a 1.5 °C stabilisation in global average temperatures within reach.
Tried and tested approaches exist for lowering methane emissions from oil and gas, and efforts to improve data quality are ongoing. A set of well-established policy tools have already been deployed in multiple jurisdictions to drive down emissions. These include leak detection and repair requirements, technology standards and bans on non-emergency flaring and venting. Still further reductions can be achieved with the help of more accurate and reliable data on emissions and abatement opportunities – but this will require robust measurement and reporting mechanisms. If all countries that have already committed to reducing methane emissions were to adopt these policies, we estimate methane emissions from global fossil fuel operations could be cut by nearly 15%.
Countries that have already committed to methane reduction can take steps to encourage their trading partners to step up abatement efforts. The committed countries will need to work together to expand their coalition through a mix of diplomatic action, incentives, technical and institutional support, and trade measures. If committed countries were to leverage their buying power, they could reduce the emissions associated with their imports of oil and gas, leading to a further reduction of more than 10%.
The oil and gas industry has a critical role to play as a complement to government action, particularly where regulatory capacity is limited. A growing number of companies are actively working to reduce methane emissions from their own operations, encourage sound policies and regulations, and provide more transparent data. These companies can quickly address emissions across their own operations and help spread best practices across the industry by extending their efforts to ventures where they are non-operating partners. This would accelerate many of the abatement actions targeted by governments and could deliver a further reduction in global emissions of almost 10%.
Better and more transparent data about the sources of methane emissions puts added pressure on countries and companies to act. Measurement‑based emissions reporting helps governments to regulate more effectively. It also allows consumers and investors to identify top performers and to work with companies on setting and achieving emissions reductions goals. Advances in monitoring technologies, notably from satellites, are a key development in this area. As the technology improves and data processing becomes more agile, early-warning systems that pinpoint methane leaks will become increasingly viable. Such powerful tools can facilitate timely action, especially in countries where oversight systems are weak.
When it comes to coal, the most effective way to lower emissions is to focus on lowering demand. But encouraging better management of methane leaks in existing and abandoned mines is also important. Under the Net Zero Emissions by 2050 Scenario, the global supply of coal falls by more than half by 2030, which would significantly reduce total methane emissions from fossil fuel operations. If all the countries with commitments on methane were to follow this path, total emissions would decline by more than 10%. A further 5% of emissions could be avoided in the near term if mine operators took steps to utilise more of their methane and to limit emissions from their abandoned sites.
A broader coalition is needed to address methane emissions. At present, around 40% of methane from fossil fuel operations originates in countries where strong commitments to reduce emissions have already been made. So even if these countries were to deploy every strategy listed above to tackle the methane emissions within their borders, it would still not deliver a 75% reduction by 2030. Although recent policies and technological advances are reasons for optimism, the time has come for all countries and operators to tackle the issue head on.