AGA Meeting with EPAAGA Meeting with EPAPart 98 Subpart W

GHG Reporting Proposed RulePart 98 Subpart W

GHG Reporting Proposed Rule

May 6 2010May 6, 2010

OverviewPam Lacey - AGA

• Build on AGA’s excellent relationship and experience gained in EPA Natural Gas STAR program

• But caution experience from individual Gas STAR projects not • But caution – experience from individual Gas STAR projects not necessarily representative – lots of variation out there

• Short timeline for the rule and difficulties involved in surveying thousands of facilities with scarce optical scanning devices will create problems for both industry and the agency:

– cannot ensure reasonable assurance of compliance – EPA will not be able to meet the criteria for “practical

enforcement” ld l k l ’ l d d f• We would like to explore EPA’s real needs and see if we can

help suggest practical ways to achieve the agency’s goals.

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I. Why Exclude Transmission …… But Not Distribution Pipes?

• Logic for Excluding Transmission Lines also Applies to Distribution and Storage

– Processes and procedures in place to address leaks expeditiously – Dispersed facilities – also true of many LDC facilities– Transmission lines are under high pressure and therefore leaks are

more obvious and would be addressed quickly. L k lik l t b dd d i kl i di t ib ti• Leaks likely to be addressed more quickly in distribution

– LDCs have extensive leak management programs to avoid, detect and address leaks quickly - DOT PHMSA & PUCs regulate and require more for LDCs than for pipelinesrequire more for LDCs than for pipelines

– Odorization – The nose knows – 65 million customers – they will call right away

– LNG and underground storage – just like transmission lines -- are under high pressure and the operator quickly becomes aware when a leak appears. Plus, often in odorized

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II. AGA Survey Results – Victoria Plotkin (AGA)

• LDCs have, on average, roughly 19,000 M&R stations per LDC • Wide variety among companies• Confusion about the definition of M&RConfusion about the definition of M&R• Does it include industrial, commercial and/or residential

meters?• M&R stations per company – survey results vary from 4 to over M&R stations per company survey results vary from 4 to over

500,000 – depending on what one includes • LDCs operate, on average, 60 city gate stations per company • Some companies operate their own city gatesSome companies operate their own city gates• Others say all city gate stations operated by the interstate

transmission company• Some LDCs operate over 270 city gate stations Some LDCs operate over 270 city gate stations • Most keep inventories of installed components such as

regulators and meters, but not the other components required in the proposed rule p p

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III. Emission FactorsJim McCarthy (IES)

Emission factors are outdated

• Brief history of GRI emission factors Brief history of GRI emission factors

• AGA’s Guidelines for carbon footprint for LDCs

• Status and timeline of field testing and work to develop updated emission factors – AGA, EPA, GTI OTD

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IV. Annual Leak Detection – Bill Schrand (SW Gas)

• Proposed Annual Leak Detection at M&R Stations Using Optical Gas Scanners and Application of Emission Factors p ppfor “Leakers”

– Inaccurate, Costly, Burdensome and Duplicative

• LDCs already conduct annual leak surveys as required by PHMSA

• Outline PHMSA requirements

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Existing Leak Management

• Customers– Most distribution systems are located within populated areas– Odor added to natural gas is easily recognized– Customers notice gas odor and call to report - provides intense

monitoring– Lower pressures associated with most distribution pipe minimizes

gas lossgas loss

Existing Leak Management

• Emergency Plan required by DOT– Must be kept up to date– Report status of significant leaks to DOT required within 2 hours of

leak notification – Most leaks repaired within 2 hours of being reported– Southwest Gas averages one hour response time

Existing Leak Management

• Leak Survey Procedures required by DOT – Must meet DOT and PUC requirements – Procedures and records audited annually by PUCs – Federal standards for inspection frequency– States may have more stringent requirements, based on number

of leaks foundS i d i ll d l k– Sensor equipment used systematically to detect leaks

– Leaks graded according to hazard level and repaired within a specified timeframe

Existing Leak Management

• Distribution Integrity Management Plans (DIMP)– To be fully implemented in August 2011– Intended to further reduce hazards associated with leaks– Evaluation based, in part, on leak history and leak rate– Repairs based on risk determinations

Optical Scanning vs. Current Leak Detection

• EPA’s proposal exceeds even the most extensive GHG inventories performed by LDCs to date – SW Gas example

• Cheaper methods (soap solution and wand) are more reliable Cheaper methods (soap solution and wand) are more reliable and accurate than optical scanners, which are sensitive to wind and weather conditions and often miss leaks that are found by the low tech method

• There are not enough optical scanners or people trained to use them – regardless of whether the LDC purchases the equipment or hires outside consultants

• There are many thousands of above ground M&R stations –especially if EPA intends to include not just city gates and district M&R but also industrial and commercial customer M&R (basically customer meters) – EPA incorrectly assumes that there are only a few to be surveyed each year

• It takes longer to use an optical scanner than EPA assumesg p

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T bl F F iti V t d

Fugitive Vented SourcesFugitive Vented SourcesDue Date: August 19, 2005

District/Office NameC &

Table F - Fugitive VentedInformation Request Reporting Year 2004

Contact Name & Phone number

Direct Emissions - Fugitives

Source IDDistrict/ Plant/ Facility/

Business Unit Equipment Type (Examples Provided below)Length of

Pipeline (km)Number of

Stations Number of

devicesCalculated CO2

(Short Tons)F-1 Customer MetersF-2 Distribution Main Pipeline Length (Cast Iron)F-3 Distribution Main Pipeline Length (Plastic)F-4 Distribution Main Pipeline Length (Protected Steel)F-5 Distribution Main Pipeline Length (Unprotected Steel)F-6 Distribution Services Length (Copper)F-7 Distribution Services Length (Plastic)F-8 Distribution Services Length (Protected Steel)F-9 Distribution Services Length (Unprotected Steel)F 10 Di t ib ti RiF-10 Distribution RisersF-11 Distribution Reg StationF-12 Transmission Pipeline Length (Cast Iron)F-13 Transmission Pipeline Length (Plastic)F-14 Transmission Pipeline Length (Protected Steel)F-15 Transmission Pipeline Length (Unprotected Steel)F-16 Compressor StationsF-17 Other Equipment??? (separators holding tanks etc )F-17 Other Equipment??? (separators, holding tanks, etc.)F-18F-19F-20

Emissions SummaryEmissions SummaryT t l CO

Source TypeTotal CO2e

(percent of total)

Stationary & Indirect 1.5%Stationary & Indirect 1.5%

Mobile Equipment 8.5%

Fugitive & Vented 90%Regulator stations 32%

Residential and commercial meters 17%Distribution mains 30%%

Dig Ins 8%Blow Downs 3%

Grand Total 100.00%

Emissions by Customer TypeBased on Distributed GasBased on Distributed Gas

Type of Customer Number ofCustomers

GasDelivered

Percentage AverageCO2

(Decatherms)Emissions

(tons)Custom. Therms

Residential 1,727,790 70,498,626 95.586% 32.263% 2.4

Small Commercial 77,633 31,455,475 4.295% 14.395% 23.7

Compressed Gas 166 370,899 0.009% 0.170% 130.7

I i ti 379 1 323 894 0 021% 0 606% 204 3Irrigation 379 1,323,894 0.021% 0.606% 204.3

Large Commercial 896 10,817,354 0.050% 4.950% 706.3

Small Industry 254 4,118,353 0.014% 1.885% 948.5S a dust y 5 , 8,353 0 0 % 885% 9 8 5

Essential Agriculture 82 713,821 0.005% 0.327% 509.3

Procurement Sales 20 4,937,975 0.001% 2.260% 14,443.6

Transported 365 94,274,100 0.020% 43.144% 15,109.7

Total 1,807,585 218,510,497

Subpart NN - Suppliers of Natural Gas2008 N t l G D li i t C t2008 Natural Gas Deliveries to Customers

<25,000 mt< 4,600,000 Therms

Report NG Deliveries

>25,000 mt> 4,600,000 Therms

Self Reportingp p gCustomer Class Therms Customers Therms CustomersResidential 704,986,220 1,727,790 0 0Commercial 422,728,290 78,529 0 0Industrial 41,183,510 254 0 0Compressed Natural Gas 3,708,990 166 0 0p , ,Irrigation/Water Pumping 13,238,930 379 0 0Essential Agriculture 7,138,210 82 0 0P t G S l 154 309 0 49 016 621 7Procurement Gas Sales 154,309 0 49,016,621 7Other Gas Sales 208,820 13 0 0Transportation 170,550,000 337 772,191,000 28

Total 1,363,897,279 1,807,550 821,207,621 35This information has already been provided to:Clark Co., NV; Henderson, NV; Maricopa Co., AZ; San Bernardino Co., CA

Total Emissions from SWG Activities

Source Tons %Source Tons %

SWG Operations 1 694 971 11 7SWG Operations 1,694,971 11.7

Customers <25,000 tons 7,978,799 48.2Customers 25,000 tons 7,978,799 48.2

Customers >25,000 tons 4,804,065 40.1

Total 14,477,834

Direct MeasurementM&R Stations

Field test observations:• Extremely difficult to detect small leaks

R lt l i f ti l• Results were only inferential• Use of wands were more effective• Quantification by high-volume samplersy g• Excessive cost for little technical value

Examples of M&R and City Gates –Wide Variety

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SGTC City GateLaughlin, NV

Inlet MAOP 1008 psigOutlet pressure 730 psig

Gasline Road City GateVictorville, CA,

Inlet MAOP 936 psigInlet MAOP 936 psigOutlet pressure 240 psig

City GateWillow Valley, NV

Inlet MAOP 100 psigOutlet pressure 60 psig

Gypsum Plant M&RLas Vegas, NV

Convention Center M&RLas Vegas, NV

APEX Industrial M&R StationLas Vegas, NV

Small Commercial M&R Station

• Photos of components

Couplings

Couplings

Plug Valve

Small Commercial M&RFast Food Restaurant

Commercial M&RBig Box Store

Commercial M&RMedium Box Store

Commercial M&RAnother Medium Box Store

Large Commercial M&R

Large Commercial M&R

Commercial M&ROffice Building Back Up Generation

Commercial M&RLarge Office Building

Cost of Leak Detection & Optical Scanning

• Not clear what type of optical gas scanning equipment would be required

• Could affect the cost significantlyCould affect the cost significantly

– FLIR camera/ Optical Imaging Device? Cost around $80,000 to $100,000 each to purchase – around $2,500 per week to rent

– Mobile or Remote Methane Leak Detector (RMLD)? Cost around $30,000

– Vehicle-Mounted Methane Leak Detector? Cost around Vehicle Mounted Methane Leak Detector? Cost around $16,000-18,000 each

– Remote hand-held optical methane detectors? Cost around $8,000 each.$8,000 each.

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Experience with FLIRPeter Ford (New Mexico Gas)

• FLIR camera cannot scan hundreds of source types quickly –contrary to EPA’s assertion in Subpart W proposal

• The FLIR did not find any leaks we could not find already by just looking for dirty pipe or using soap solution

• And it missed the smaller leaks that we found using other methods

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Cost Considerations - M&R Surveys

• Around $40 per ton of CO2e just to estimate (not reduce) emissions at M&R stations under the proposal

• AGA survey results indicate each company would need to scan AGA survey results indicate each company would need to scan several thousand M&R stations

• Company that recently did a test run found they could only visit and perform the scan at <10 M&R stations per day per scannerand perform the scan at <10 M&R stations per day per scanner

• Each company would need over 100 scanners and trained operators to perform annual survey within a two month period at the average 19 000 M&R stations per company at the average 19,000 M&R stations per company

• A substantial portion of the expected costs would be avoided if M&R stations were removed from the rule – or at least if the term were defined to clearly exclude industrial commercial and term were defined to clearly exclude industrial, commercial and residential customer metering

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Big Picture – Danny Smith (Alagasco)

• What are your goals?• Are EPA’s goals already served by existing regulations?• Is your goal to generate methane emissions data to allow for Is your goal to generate methane emissions data to allow for

calculating the lifecycle GHG emissions for using natural gas or other energy sources?

• AGA supports using lifecycle analysis for calculating energy pp g y y g gyefficiency and GHG emissions

• Better way to achieve that goal--– LDCs already report mileage of mains and services to DOT– EPA creates the annual GHG Inventory applying available emission

factors for bare steel, plastic and cast iron pipe to that mileage– Subpart W would just duplicate that effort for mains and pipes h j h i i O d d• Why not just use the existing DOT data and EPA

Greenhouse Gas Inventory? • And use updated emission factors when available.

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Additional Concerns

• Request clarification – distribution vs. transmission -PGE

– The proposal does not specify where to draw the line between distribution and transmission operations

– Many members operate both distribution and transmission lines and will need additional clarifications to determine what portions of operations are proposed to be includedoperations are proposed to be included.

• Need definition of “connector”

• Does EPA really need the count for such small fittings?

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Questions & Comments

• AGA member company representatives on the phone and webinar link may pose questions to EPA or make additional comments

• “Raise Your Hand” in Chat Area – and post short note in chat area regarding your topic

• When Pam Lacey calls on you, press *6 to un-mute your phone and ask your question

• When you are done, press * 6 to mute your phone again When you are done, press 6 to mute your phone again

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Conclusion• Postpone Subpart W applicability to Distribution until update

emission factors, then see what makes sense• In alternative, use existing GHG Inventory for distribution pipes g y p p

and phase in requirements for M&R and city gates– Use existing best practices in 2012– Phase in additional requirements in 2015– Reduce number of components– Define M&R to exclude industrial, commercial and residential

customer metering and regulatingD i t f i f d d ll f i ti • Drop requirement for infrared cameras and allow use of existing leak surveys as required by PHMSA and utility commissions

– or at least define what types of equipment you have in mind and allow the use of alternative methods in use no – such as soap allow the use of alternative methods in use no such as soap solution and wands

• Do what makes sense and will allow for compliance assurance

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THANK YOU FOR YOUR TIMETHANK YOU FOR YOUR TIME

Pamela LaceySenior Managing Counsel, Environment

placey@aga.org

Pamela LaceySenior Managing Counsel, Environment

placey@aga.org