Who pays for greenhouse gas emissions?

A story in Scientific American discusses the difficulty of assessing greenhouse gas (GHG) emissions. The oil industry in the United States are as of next year required to report GHG emissions from all their activity, some 13,000 sites. Not surprisingly, the industry organization API (American Petroleum Institute) protests, wanting more lenient regulation:

“We feel that to make this successful, there needs to be some acceptable lead time for facilities, and that should include allowing for best available data … until normal scheduled and planned shutdowns or services at our facilities to install the new monitoring devices,” said API’s Khary Cauthen, who attended the meeting.

Actually, this question is not as simple as it might seem, with the government wanting something and the industry protesting out of old habit. The exact measuring of GHG emissions is a complicated thing, and there might be something in the industry’s claim that “There is not that standard methodology yet”. However, when they want to use “best available data”, isn’t this an exact description of what will be the case under either regime? It would seem to me that normal regulation would require the industry to keep up on the prevailing best way of determining GHG emissions, but allow for some period of adjustment for each new measuring technology. As it is for most of the refinery sites, they have biannual downtime for refitting and upgrades, so the time period wouldn’t be too long.

Furthermore, there is the question of how to define GHG emissions. To quote the article,

The group also argues that the draft rule imposes requirements for reporting on petroleum-products supplies that will result in “significant overstatement” of emissions for some facilities, according to comments that API sent in June to EPA.

This is because some products, such as asphalt and lubricants, are not ultimately burned the group wrote. Also, some products, such as naphtha, require further processing or blending.

“The refinery that processes the feedstock and produces the extra volume of product should be the one that reports,” API wrote. “If a facility has the ability to determine that the stream will not be combusted they should be able to exclude it from their GHG emissions calculations.”

So who should shoulder the burden here? Ideally, some sort of life-cycle analysis of petroleum products should be agreed on, where a form of GHG accounting is set up deciding who takes which expense in a transaction. Example: a refinery receives some crude oil, accounts for their part of the processing of some finished (gasoline) and some half-finished products (naphtha for further refining) and, idunno, half the transporting emission of both kinds to end users (e.g. gas stations) or other refineries. This will be costly and bureaucratic, but that’s the only way to set this up in a just way. Because the API does have some good points. This does not give them carte blanche to dictate terms in all such issues. They can afford this, and they would earn a lot by showing some interest in working with governments in such regulation.

The larger point here is of course the very real problem of having accurate knowledge about human activity. The statistics we have about a large portion of what it is we actually do and buy is simply aggregations and sometimes even just educated guesses. We don’t really know how much traffic there is, we don’t how much is bought and sold of any products (except maybe online goods, but there we have the reporting problems of pirated goods), we don’t know how much money there is in the world, we don’t know how much oil there is and so on and so on. Of course, some of this has to do with surveillance issues, but it also hampers our ability to make efficient policy. A real dilemma, there.

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