Currently, process emissions, production driven reductions, and policy driven potential emissions reductions and costs for oil and gas extraction are grouped into the oil and gas extraction industry to align with the ISIC code structure. However, we separately track oil and natural gas extraction internally in the EPS and the data sources (EPA and IEA) for BPE and PERAC include detailed data for oil vs gas related process emissions and reductions/costs.
The structure for estimating production related process emissions changes for the oil and gas industry uses an energy-weighted average percentage reduction in output and multiplies this by BAU process emissions:
_ZIDZ(
Percent Change in Domestic Fuel Production by Fuel[natural gas]
BAU Fuel Production Imports and Exports[natural gas,production]
Percent Change in Domestic Fuel Production by Fuel[crude oil]
BAU Fuel Production Imports and Exports[crude oil,production],
BAU Fuel Production Imports and Exports[natural gas,production]
BAU Fuel Production Imports and Exports[crude oil,production]
)_
This percentage change is then multiplied by BAU Process Emissions to estimate the emissions reductions from the combined oil and gas industry.
The problem with this approach is that the oil and gas industries have pretty different emissions extraction profiles (and outside of the US, e.g. in Canada, this is even more pronounced).
For example, in the US EPS, 2020 crude production is 2.2e16 BTUs and natural gas production is 3.5e16 BTUs. But per the EPA data we have in BPE and PERAC, 2020 natural gas process emissions were 84 MMT compared to 158 MMT from oil. In other words, the process emissions intensity per unit energy of crude extraction approaches triple the amount for gas. Therefore, using a weighted average energy approach to estimate process emissions reductions is pretty inaccurate. (As an aside, the IEA data is very different here, probably from the use of different leakage rates for natural gas, but it highlights the importance of having this distinction).
We should consider updating the structure to break apart process emissions, production driven reductions, and policy driven reductions for each of oil and natural gas production. This could be implemented in many different ways in the EPS. Here are a few ideas;
We could keep the current structure but split the process emissions and the potential reductions by reading in multipliers for each, we could sum the costs for each component together to keep it within a single oil and gas sector.
We could further subdivide the oil and gas extraction ISIC code, but we would need the relevant data to do that (I would advise against this approach for now).
We could add some new structure for reading in BPE that assigns the values by industry category/ISIC code and fuel type, where relevant.
These are just a few ideas, but there are many other, probably better ones out there.
There has also been some interest in further subdividing oil and gas extraction into the type of oil and gas extraction (which the IEA data has) to better represent differences in extraction approaches. This has come up primarily in Canada in the context of tar sands vs conventional extraction. I don't know if we should pursue this but this is a good place to mention it.
Currently, process emissions, production driven reductions, and policy driven potential emissions reductions and costs for oil and gas extraction are grouped into the oil and gas extraction industry to align with the ISIC code structure. However, we separately track oil and natural gas extraction internally in the EPS and the data sources (EPA and IEA) for BPE and PERAC include detailed data for oil vs gas related process emissions and reductions/costs.
The structure for estimating production related process emissions changes for the oil and gas industry uses an energy-weighted average percentage reduction in output and multiplies this by BAU process emissions:
_ZIDZ( Percent Change in Domestic Fuel Production by Fuel[natural gas]
BAU Fuel Production Imports and Exports[crude oil,production],
BAU Fuel Production Imports and Exports[natural gas,production]
This percentage change is then multiplied by BAU Process Emissions to estimate the emissions reductions from the combined oil and gas industry.
The problem with this approach is that the oil and gas industries have pretty different emissions extraction profiles (and outside of the US, e.g. in Canada, this is even more pronounced).
For example, in the US EPS, 2020 crude production is 2.2e16 BTUs and natural gas production is 3.5e16 BTUs. But per the EPA data we have in BPE and PERAC, 2020 natural gas process emissions were 84 MMT compared to 158 MMT from oil. In other words, the process emissions intensity per unit energy of crude extraction approaches triple the amount for gas. Therefore, using a weighted average energy approach to estimate process emissions reductions is pretty inaccurate. (As an aside, the IEA data is very different here, probably from the use of different leakage rates for natural gas, but it highlights the importance of having this distinction).
We should consider updating the structure to break apart process emissions, production driven reductions, and policy driven reductions for each of oil and natural gas production. This could be implemented in many different ways in the EPS. Here are a few ideas;
We could keep the current structure but split the process emissions and the potential reductions by reading in multipliers for each, we could sum the costs for each component together to keep it within a single oil and gas sector.
We could further subdivide the oil and gas extraction ISIC code, but we would need the relevant data to do that (I would advise against this approach for now).
We could add some new structure for reading in BPE that assigns the values by industry category/ISIC code and fuel type, where relevant.
These are just a few ideas, but there are many other, probably better ones out there.
There has also been some interest in further subdividing oil and gas extraction into the type of oil and gas extraction (which the IEA data has) to better represent differences in extraction approaches. This has come up primarily in Canada in the context of tar sands vs conventional extraction. I don't know if we should pursue this but this is a good place to mention it.