Change Agents: Making Sense of the Subpart W Revisions White Paper Enviance Change Agents: Making Sense of the Subpart W Revisions Change Agents: Making Sense of the Subpart W Revisions White Paper On December 23, 2011, the Environmental Protection Agency issued a final rule that amends Subparts A and more significantly, Subpart W of the EPA Greenhouse Gas Mandatory Reporting Rule (GHG MRR). The revisions were intended to correct errors and address issues identified by reporters. Given the significance of the changes, many companies are wondering how the revisions affect their reporting requirements. Are there additional errors in the subpart revisions? Enviance has created this white paper to answer these questions and help companies navigate the most significant and relevant changes in Subpart W. Definitions EPA made clarifications regarding several Subpart A and Subpart W definitions of source category. For example, it was clarified that the terms “Owner” and “Operator” used in Subpart A have the same definition as defined in Subpart W 98.238. This is an important clarification because a different definition was originally provided in Subpart Page 2 A. In essence, it refers to the permit holder or person who pays taxes on the well pad or location, or operator of the facility. EPA also clarified the meaning of Continuous and Intermittent Bleed Pneumatic Devices in Subpart. In Subpart W 98.230, Onshore Petroleum and Natural Gas Production was clarified to include dehydrators and vessels on well pads or associated with a single well page. In addition, Enhanced Oil Recovery operations that use CO2 are included. The recovery of separated gases is not required in Onshore Natural Gas Processing, and the included processes are identified in generic terms. The 25 MM scf/day threshold applies to plants that do not fractionate. Relating to Onshore Natural Gas Transmission Compression, “transmission pipeline” is now defined at 98.238 to be consistent with the intent used at 98.230. In addition, the revisions clarify what Transmission Compression facility includes, and removed the term “natural gas dehydration.” Under Natural Gas Distribution, EPA replaced “city gate station” with “meteringregulating station.” This is an important improvement as Enviance found many reporting clients couldn’t understand what “city gate” was meant to be. Both “meteringregulating station” and “distribution pipeline” at 98.238 are defined in the revisions to be consistent with the intent at 98.230. In addition, the Local Distribution Company description was made consistent Change Agents: Making Sense of the Subpart W Revisions with Subparts NN, essentially meaning suppliers of fuels. EPA also provided definitions for specific terms in Subpart W 98.238. “Associated with single well pad” was newly added for consistency with its source category definition. In addition, “Facility for Onshore Petroleum and Natural Gas Production” was revised for clarification, reflecting the single well pad approach. “Facility for Onshore Petroleum and Natural Gas Distribution” was revised to clarify that all distribution pipelines operated by an LDC in a single state are included. Additional Subpart W definition changes include: “Farm taps” has been revised to eliminate the reference to city gate. “Flare” at the ground level or elevated is newly added, and energy recovery is not required. The broad definition brings in almost any combustion that’s not heat recovery or furnace. “Forced extraction of natural gas liquids” is newly added and describes the removal of C2+ hydrocarbons. The definition excludes dehydration and other water removal activities. “Gas well” has been removed and is now addressed in the “sub-basin” category definition. “Natural gas” is newly added and includes field quality, pipeline quality or process gas. “Oil well” has been removed and is now addressed in the “sub-basin” definition. “Pressure groups” is newly added and used in revised calculations for Well Venting for Liquids Unloading. “Tubing diameter groups” is newly added and used in revised calculations for Well Venting for Liquids Unloading. “Sub-basin category” is newly added, changing from measurements at the field level to the sub-basin level. This category has county overlay in this definition. “Transmission-distribution (T-D) transfer station” is newly added, defining what was previously termed “custody transfer.” This has been added for consistency with the definition of distribution facility. “Transmission pipeline” has been revised, clarifying the definition to be consistent with FERC or state rateregulated pipelines, or those covered by the Hinshaw Exemption of 1994 Natural Gas Act. “Horizontal well” is newly added and used in calculations for well completions and workovers. “Vertical well” is newly added and used in calculations for well completions and workovers. “Well testing venting and flaring” is newly added, defined as occurring at the time the production rate is Page 3 Change Agents: Making Sense of the Subpart W Revisions determined. If the production rate is determine upon completion, then that activity would be part of completions and workovers, as opposed to using the different calculation for well testing and flaring. Calculations In the December 23, 2011 revisions to Subparts A and W, there were 58 separate changes to calculation definitions or the terms used in the calculations. As most of the changes are clarifications and technical improvements, this white paper covers the most significant changes. One key change is that the standard temperature was defined as 60o F. Many of the changes made to the emission factors are due to the standard temperature and pressure (STP) change. For example, in Table 1A (onshore production), most of the new factors are lower and the pneumatic devices are now different for the Eastern and Western United States. The Western U.S. appears to be changed due to the STP shift, while the Eastern changes are perhaps due to new information. In either case, the emission factors are reduced. In Tables 2 (natural gas processing), Table 3 (transmission compression), Table 4 (underground storage), Tables 5 and 6 (LNG storage and import/export), and Table 7 (natural gas distribution), all changes are due to the change in STP. Page 4 There have also been significant actions taken in the calculations changes. For pneumatic devices and pneumatic pumps, Equations W-1 and W-2 now use Tt (average estimated number of operational hours). The default is now 8760 hours, which is a change EPA made at the request of industry to allow people with data on their operating time to have a lower value to go from hourly emissions to yearly emissions. In addition, both equations use correct factors to convert scf to CO2e: • • CH4: 0.000403 metric tons CO2e per scf CH4 at 60F CO2: 0.00005262 metric tons CO2e per scf CO2 at 60F Acid gas removal calculations, Equations W4A and W-4B, were added in place of W-4 to clarify inlet vs. outlet measurement approaches. Previously, reporters had to make their own decision with single equation 4. The well venting for liquids unloading calculation now uses the tubing diameter and pressure group combination approach in Equation W-7. Those two factors go into the flow rate (FR) factor below, for a unique combination of tubing diameter and pressure group. Change Agents: Making Sense of the Subpart W Revisions For gas well venting completions/workovers with hydraulic fracturing, reporters now need to aggregate measurements at the sub-basin level. In addition, Equations W-10A and W10B have been added in place of W-10 to reflect whether the backflow (synonymous with the term flowback used in the industry) is measured with a meter. Use Eq. W-10A if flowback is calculated or measured. Use Eq. W-10B if flowback is measured or vent gas flow rate is measured. Blowdown vent stacks are now applicable to only manually activated operations and use the “unique physical volume” concept. Equation W-14A is used when temperature and pressure are the same for all blowdowns or a group of blowdown events. Equation W-14B is used when temperature and pressure vary for each event, and is the sum of all individual blowdowns. Equations have been renamed and Equation W-11C has been added to determine if the flow is sonic. If the value of R in Eq. W11C is equal to or greater than 2, then flow is sonic and Eq. W-11B should be used to calculate FR (which is subsequently used in defining FRM in Eq. W-12). If flow is not sonic, use Eq. W-11A to calculate FR. Equation W-12 now defines FRM, the ratio of backflow rate to average production rate. FRM is then used in other calculations. For onshore production storage tanks, EPA clarified that the 10bpd threshold is based on annual average daily throughput. Equation W-15 was corrected to add the factor of 1,000 that was missing. [Please note, however, that e-CFR did not display the factor of 1,000 in W-15 as of May 18, 2012.] Equation W-16 was revised to reflect yearly emissions rather than hourly. EPA replaced well testing venting and flaring Equation W-17 with W-17A for oil well and W-17B for gas well. Eq. W-17A uses the gas to oil ration method, which helpful as a substitute for storage tank counts. The gas to Page 5 Change Agents: Making Sense of the Subpart W Revisions oil ratio for materials multiplied by the throughput provides the potential maximum gas emissions for that. For gas wells, an estimate is provided by calculating production rate multiplied by daily flow. Eq. W-17A is also useful as an easy means of calculating emissions from separators, tanks, and combinations of the two. As stated above, it assumes that all gas in the oil is emitted. This may overstate the emissions somewhat, but this conservative approach may be well worth it, since it is much simpler than using E&P Tanks or other more complex emissions estimating applications. For flare stack emissions at 98.233(n), EPA made a clarification that onshore natural gas processing plants that solely fractionate a liquid stream use GHG mole percent in feed natural gas liquid for all streams. In addition, the Tier 4 (CEMS) method is allowed if CEMS is present. For leak detection and leaker emission factors in 98.233(q), Equations W-30A and W-30B were added in place of W-30. W-30A should be used for natural gas processing, transmission compression, underground storage and LNG storage and import/export. W-30B is used for natural gas distribution. Page 6 For underground storage and transmission compression GHGi, use 0.975 for CH4 and 0.011 for CO2. For LNG storage and import/export GHGi, use 1.0 for CH4 and 0 for CO2. For natural gas distribution GHGi, use 1.0 for CH4 and 0.011 for CO2 [the CO2 value, however, is likely a mistake since the total should not exceed 1.0.] In addition, monitoring for leaks can be done over a period of up to 5 years. In population count and emission factors (98.233r), “meter/regulator runs” at above grade “metering-regulating stations” term is used instead of “non-custody transfer city gate.” In equation W-31, underground storage and transmission compression GHGi uses 0.975 for CH4 and 0.011 for CO2. LNG storage and import/export GHGi uses 1.0 for CH4 and 0 for CO2. Natural gas distribution GHGi uses 1.0 for CH4 and 0.011 for CO2, which could possibly be a mistake. Equation W-32 now yields an emission factor with a unit of measure of scf per meter-regulator run per hour. There may also be a potential mistake in the combined use of W-30B and W-32 to produce the emission factor in W31, which results in the double use of GHGi. Since the GHG factor is present in each one, it actually creates a much lower than intended emissions factor. Change Agents: Making Sense of the Subpart W Revisions For volumetric emissions in 98.233t, the standard temperature was set at 60 degrees F and standard pressure was retained at 14.7 psia. In GHG volumetric emission in 98.233u, the mole fraction (Mi) should be an annual average value when measuring. The default mole fraction was set at 0.95 for CH4. Please note the inconsistency with 98.233q for these values. It may take some work to unify how fugitive emissions vs. process emissions and their default values are being handled. • Segment • 98.233(u) • 98.233(q) • TC • 0.95 • 0.975 • Und. Storage • 0.95 • 0.975 • LNGs • 0.95 • 1.0 • Distribution • 0.95 • 1.0 For GHG mass emissions in 98.233v, ρ I is the density of GHGi. Use 0.0526 kg/ft3 for CO2and N2O, and 0.0422 kg/ft3 for CH4at 60 °F and 14.7 psia. numerous other calculations. There is a significant error in that this equation takes the volume of individual gas and multiplies it by density and global warming potential to come up with the equivalent amount of CO2e. However, the CH4 density factor is incorrect (correct value noted above.) The mistake is a factor of 2.2, so do not apply it as it will more than double the amount of emissions. After notifying EPA on January 13, 2012 that the CH4 density value is incorrect in Eq. W36, Enviance received response that “if the EPA decides to issue guidance on this topic, it will be posted here: http://www.epa.gov/climatechange/emissions /subpart/w.html. For onshore production and distribution combustion in 98.233(z), EPA clarified that external fuel combustion sources with a rated heat capacity equal to or less than 5 mmBtu/hour are exempt. In addition, internal fuel combustion sources that are not compressor drivers and with a rated heat capacity equal to or less than 1 mmBtu/hour are exempt. EPA also clarified that Subpart C methods should be used in the following cases: • • Please note that the density of CH4 provided by EPA is incorrect. The correct value is 0.01919 kg/ft3. Another note of caution is that Equation W-36 is applied to results from • • Fuel is listed in Table C-1 or blend thereof Fuel is pipeline quality natural gas with minimum HHV of 950 Btu/scf Can use any tier of Subpart C Reporting as required in Subpart W 98.236(c)(19) Page 7 Change Agents: Making Sense of the Subpart W Revisions Subpart W methods should be used in the following cases: • • • Field gas, process vent gas or blend thereof, or not pipeline quality Use calculation method at 98.233(z)(2) – carbon content approach Reporting as required in Subpart W 98.236(c)(19) In essence, if an organization’s fuel meets qualities shown in Table C-1 from Subpart C, then use Subpart C methods. Otherwise, use the Subpart W method, which is a carbon counting method. Reporting A reporting rollup by equipment/component type is common. The population emission factor reporting had a significant rollup change. The original rule required rollup by equipment type. The revisions now ask for it by component type, which significantly changes the way calculations are put together and assembled after basic calculations are done. For gas sent to a flare, companies now need to report the amount to unlit flare and to lit flare. Emissions are reported under the equipment source type, not at the flare. Companies need to back those emissions out when doing their flare calculations so as not to double report. A unique name or ID is now required for blowdown vents for all segments (unique Page 8 blowdown volume), acid gas recovery units in onshore processing segment, dehydrators in onshore processing segment, flares in onshore processing segment, and storage vessels in transmission compression segment. Reporting changes for well venting for liquids unloading for each tubing diameter group and pressure group combination in each sub-basin category include: count of wells vented to the atmosphere for liquids unloading – which is a fairly significant change, count of plunger lifts, whether the selected well from the tubing diameter and pressure group combination had a plunger lift, cumulative number of unloading vented to the atmosphere, and average flow rate of the measured well venting in cubic feet per hour. Additional reporting changes are internal casing or tubing diameter and well depth of each well in that tubing size and pressure combination, casing pressure in that tubing size group and pressure group combination that does not have a plunger lift, tubing pressure in a tubing size group and pressure group combination that has a plunger lift, and annual CO2 and CH4 emissions, expressed in metric tons of COe for each gas. Reporting by sub-basin category is also applied to workovers and completions, storage tanks for onshore production, and enhanced oil recovery. For each oil sub-basin category, EPA has also added a requirement that companies report their best estimate of Change Agents: Making Sense of the Subpart W Revisions API gravity, gas to oil ratio, and average low pressure separator pressure. Conclusion EPA made many revisions and additions in its December 2011 revisions rule – some minor and some significant. It can be overwhelming to understand how the changes affect your organization and how changes in calculations and reporting, combined with some of the errors, could affect the outcome for your company. This white paper has provided a high-level overview of some of the more significant and relevant revisions. But if you’re in need of further detail on the Subpart W revisions, organized by subject matter, Enviance has created a 200+ page, detailed guide to the revisions. The content and expert advice is easy to read and use, and provides a step-bystep guide to implementation. Contact John at 760-496-0200, x215 to receive your copy of Enviance’s 200+ page Guide to Subpart W revisions! About Enviance Enviance is the leading provider of Environmental ERP software. With more than a decade of experience providing environmental data management and expertise, Enviance’s proven system is used by the world’s largest corporations and government agencies. Enviance maintains deep domain expertise in EHS management and technology, and has more than 17,000 users in more than 49 countries, including American Electric Power, ArcelorMittal, Beam Global Wine & Spirits, Boral Industries, Chevron, Continental Resources, DuPont, Entergy, FujiFilm, Freescale, Georgia-Pacific, Koch Fertilizer, Los Angeles World Airports, Metropolitan Water District of Southern California, Midway Products, NV Energy, Oldcastle Building Products, Pacific Gas & Electric, Patriot Coal, Princeton Plasma Physics Laboratory, Roquette America, Sanofi Pasteur, Southern California Edison, Southern Company, Syngenta, US Dept. of Defense, Valero, and Walmart. Industry leaders have used Enviance to streamline GHG Management since 2006. For more information: www.enviance.com Page 9
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