EU to Delay by Three Years Methane Rules Penalties on Importers
(Bloomberg) -- The European Union’s executive plans to recommend that member states delay by three years penalties on energy importers that fail to comply with the bloc’s controversial methane emissions rules.
Over past months, the European Commission has resisted pressure from the US, the oil and gas industry, and more than half of its member states to revise its methane rules, opting instead to issue non-binding guidance. It is set to recommend next week that penalties should not be applied between 2027 and 2029, except for “cases of large-scale fraudulent breaches,” according to a draft document seen by Bloomberg News on Friday.
Disagreements over the rules — which target emissions of the potent greenhouse gas within the EU and impose new requirements on fossil fuel imports — have intensified after the US, Qatar and other gas-producing nations warned the bloc that the regulation could jeopardize energy shipments.
Beginning in 2027, fossil-fuel imports into the EU will have to comply with monitoring, reporting and verification requirements aimed at reducing methane emissions, a greenhouse gas that traps about 80 times more heat than CO2 over its first 20 years in the atmosphere. By 2030, imports exceeding a methane-intensity threshold will face penalties. Under the current framework, companies could be fined as much as 20% of their annual turnover.
The US, which has become Europe’s largest supplier of LNG, has warned that its supplies will head elsewhere if the bloc refuses to ease the regulation.
The debate comes as the EU seeks to bring down stubbornly high energy costs and diversify supplies amid the conflict in the Middle East and efforts to end reliance on Russian energy. It also underscores the challenges the bloc faces in extending stricter environmental standards to imports from third countries.
The industry has repeatedly said that the recommendations pledged by the EU are not enough and that importers risk being pushed into non-compliance. They cited verification as a major bottleneck, with too few recognized protocols and verification bodies.
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