Could EU methane emission rules hamper a gas deal with Trump?
Pipe dream
Major EU importers of gas have said that the bloc’s new rules to cut methane emissions are complicating contract negotiations, just as the bloc tries to wrap increased energy purchases into a trade deal to appease US President Donald Trump, writes Alice Hancock.
Context: The EU adopted stringent rules to cut methane emissions in 2024. Methane, which often leaks from gas infrastructure, is 80 times more polluting than carbon dioxide during the 20 years after it is released, and a significant contributor to climate change. Fixing methane leaks is seen as one of the most achievable climate policies.
Under the EU methane rules, fuel importers must monitor and report their methane emissions or face fines. Other countries’ rules can be deemed “equivalent”, but few have a framework as strict as the EU’s.
In a letter to the European Commission sent today, gas companies including BP, Equinor and Uniper have said that “unresolved uncertainties” in the law concerning importers’ reporting requirements are “already disrupting contract negotiations and risking the EU’s energy security”.
The companies, which will face fines of 20 per cent of annual turnover for non-compliance, have said that the commission must take “urgent action” to clarify the rules. Otherwise they will “further limit Europe’s ability to attract diverse and reliable gas supply”. Companies are due to make their first reports in May.
The statement comes as the EU is in the process of finalising a plan for how to wean itself off Russian fossil fuels. A senior EU official said that the document would contain various legal options for how companies could break their Russian contracts.
Brussels favours buying more US LNG as a way to fill any gap left by cutting out the last Russian imports, and Brussels has said it is happy to comply with Trump’s demands that the EU buy more US fossil fuels as a way to bridge its goods trade deficit with the US.
Trump shook hands with commission president Ursula von der Leyen at Pope Francis’ funeral on Saturday, and the two used a brief exchange to agree to a meeting, her spokesperson said without providing details.
But Trump has also moved to scrap US rules around reporting methane emissions, complicating any efforts to deem US methane rules equivalent in order to smooth imports.