Investors Worth $5.35 Trillion Demand US Methane Regulations

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by | May 18, 2021

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Nearly 150 investors with $5.35 trillion in assets under management have signed a statement calling for stronger methane regulations and enforcement in the United States. Key signatories include Allianz SE, CalSTRS, Legal & General Investment Management and Wespath Benefits and Investments.

Methane, the main component of natural gas, is 84 times more potent as a greenhouse gas than CO2. In addition to its impact on global warming, methane emissions are harmful to human health, including increasing the risk of respiratory illness and heart disease. These impacts are of considerable concern to industry workers and environmental justice advocates.

As the Interfaith Center on Corporate Responsibility (ICCR) writes, “The debate is not whether there should be methane regulations, it’s about how strong the methane regulations should be and how strongly they should be enforced.” said Brian Rice, portfolio manager, CalSTRS. “Investors and companies have a responsibility to help ensure that methane is properly regulated.” 

Regulations would actually help, not harm, oil and gas companies, according to the statement. A 75% reduction in global methane emissions is possible with current technology, and up to 40% of emissions could be mitigated at no net cost. Many major oil and gas companies including Jonah, Pioneer, BP and Shell have already spoken out in favor of methane regulation. 

“There are thousands of independent oil and gas companies across the country operating millions of wells, to say nothing of the more than three million orphaned wells that can continue to leach methane into the atmosphere,” said Andrew Logan, senior director of oil and gas at Ceres. “Without strong regulations and a level playing field, some companies will continue to perform poorly, and as larger companies spin-off old assets to smaller operators, the likelihood of leaks and fugitive emissions will increase. Without methane reductions, the climate math will not work for us to reach critical targets, locally or globally. It’s that simple.” 

The statement’s signatories were coordinated by Ceres, a leading advocate for a just and sustainable future, and the ICCR. It represents another step in a decade-long effort by investors to press for effective methane regulation at the federal and state levels.

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