ICF Methane Cost Curve Report

A groundbreaking analysis conducted by ICF International (ICF) shows that the U.S. oil and gas industry can significantly and cost-effectively reduce emissions of methane – the primary ingredient in natural gas and a highly potent greenhouse gas – using currently available technologies and operating practices.

Environmental Defense Fund commissioned ICF, a leading technical consulting firm with over thirty years of experience in the energy sector, to analyze the economics of methane emission reduction opportunities across the natural gas industry, from upstream production to downstream distribution. ICF’s analysis is based on data and comments from numerous organizations, including oil and gas producers, pipeline operators, equipment vendors, service providers and a trade association.

Key findings of ICF’s report:

1. Total methane emissions from U.S. oil and gas are projected to increase 4.5% by 2018 as emissions from industry growth – particularly in oil production – outpace reductions from regulations already on the books.
2. Industry could cut methane emissions by 40 percent below projected 2018 levels at an average annual cost of less than one cent per thousand cubic feet of produced natural gas by adopting available emissions-control technologies and operating practices. This would require a capital investment of $2.2 billion, which Oil & Gas Journal data shows to be less than 1% of annual industry capital expenditure.
3. If the full economic value of recovered natural gas is taken into account, the 40% reduction is achievable while saving the U.S. economy and consumers over $100M per year.
4. The most cost-effective methane reduction opportunities would create over $164M net savings for operators.
5. Almost 90% of projected 2018 emissions will come from oil production and existing natural gas infrastructure.
6. A number of solutions, particularly in the upstream of the oil and gas value chain, will have environmental co-benefits at no extra cost, by reducing emissions that can harm human health, like volatile organic compounds and hazardous air pollutants. 

This report shows that there are real solutions that can put natural gas on a safer path for communities and for the climate.

This new analysis also complements other research EDF is engaged in to help advance methane science and provide deeper understanding of methane emissions from the natural gas supply chain, in order to inform policymakers about opportunities to reduce methane emissions.

Download the report

ICF Methane Cost Curve Report Adobe Reader [PDF]