AURORA, Colo. -- Colorado will be the first state in the country to regulate emissions of methane, a potent greenhouse gas, as part of new air quality rules for the state's booming oil and gas industry that were finalized on Sunday afternoon.
Operators of wells across the state will also have to abide by stricter leak detection requirements under the new rule, which survived the five-day rule-making process mostly in tact, despite efforts by the industry's main trade group to change it.
Since the rule-making opened on Wednesday, the Commission heard from concerned citizens, politicians, air quality experts, doctors, environmentalists and representatives of the energy industry.
On Sunday afternoon, after voting down motions to weaken the rule based on suggestions from the industry -- they wanted the rule applied only along the Front Range in ozone "non-attainment" areas and to exempt smaller wells altogether -- the board voted 8-1 in favor of the new rules.
"I think that the vote was 8-to-1 tells you we felt this was a strong, fair rule," said AQCC Chairman John Loewy.
The three largest operators in the state, Noble, Anadarko and Encana pledged to support the rules, which were outlined late last year by Gov. John Hickenlooper after he brokered a compromise that got them, along with the Environmental Defense Fund, to officially sign on.
That compromise was announced after Hickenlooper and the Commission delayed the rule-making, initially set to be completed before the end of 2013, in order to allow more time to come to an agreement.
"I think that coalition being in place was a critical factor," Loewy said Sunday. "And I thought they also presented very strong arguments."
Those operators will also absorb about 75 percent of the overall cost of the new regulations.
"Smart and cost-effective regulations – ensuring that oil and natural gas is developed in the safest way possible – are in the best interest of all Colorado residents,” said Ted Brown, Noble Energy Senior Vice President, in a statement Sunday evening to FOX31 Denver. "We all want clean air, and we believe keeping methane in the pipeline and out of the air is the right thing to do.
"We believe these new rules will help improve air quality and enable responsible, economic energy development. They establish the most progressive and protective air quality regulations governing hydrocarbon emissions from the oil and natural gas industry. Just as importantly, the collaborative effort to develop these rules demonstrates we can work together to have the energy we need, the economy we want and the environment we deserve."
Rules are a victory for Hickenlooper
The final vote was also a major victory for Hickenlooper, who is facing reelection in November and now pointing to the compromise he helped broker as evidence of pragmatic, consensus-focused leadership.
"Colorado is proving once again that collaboration and compromise help solve important issues facing our state. The new rules approved by Colorado’s Air Quality Control Commission, after taking input from varied and often conflicting interests, will ensure Colorado has the cleanest and safest oil and gas industry in the country and help preserve jobs," said Hickenlooper, a former geologist who has often irked environmentalists by supporting fracking, in a statement Sunday night.
“We want to thank the environmental community, the energy industry and our state agencies for working together so hard to take this significant step forward. All Coloradans deserve a healthy economy and a healthy environment, and we’re working to ensure that Colorado continues to have both."
Hickenlooper is planning a celebratory press conference at the Capitol on Tuesday where he'll be joined by representatives of the big three energy companies and the environmental groups that supported the rules.
Commission rejects "step-down" motion
As it deliberated Sunday, the Commission also rejected an industry motion to reduce -- or "step down" -- the requirement that operators check most wells for leaks once a month if those operators demonstrate that they don't have many leaks; but commissioners also expressed a willingness to study that issue further.
"It's true that most of the leaks you find will occur in the first year of monitoring," said Dan Grossman of the Environmental Defense Fund. "But what's not true is that those leaks stop occurring, because they don't."
As the Commission finally wrapped up its hearings Sunday inside the Aurora City Council Chambers, environmentalists stood up and high-fived.
"Today is a great day for Colorado’s air, our communities and the health of our children and loved ones," said Conservation Colorado's Pete Maysmith in a statement. "Thousands of Coloradans across the state made their voices heard in support of strong air protections from oil and gas operations - and they were heard.
"Colorado has seen an explosion of oil and gas drilling and these new protections will go a long way toward reducing ozone and methane pollution which contributes to climate change. These landmark new protections would not have been possible without the leadership of Gov. Hickenlooper or the willingness of a number of oil and gas companies to meet their social and moral obligations to address their pollution and plug their leaks."
The Colorado Oil and Gas Association, the industry trade group that pushed hard to change the rules, also issued a statement following the vote.
“Oil and gas operators in Colorado strive to protect the health and safety of our communities and environment every day; after all, these are the communities where we are raising our families," said COGA's Doug Flanders. "The rulemaking process demonstrated a commitment to bringing all stakeholders together.
"The new rules accomplish much, which we support. Unfortunately, we were not successful in ensuring that the rule accommodates the differences in basins and operators. Nevertheless, we are committed to working with our operators, our communities, and the state to successfully and effectively implement these rules."
Stan Dempsey with the Colorado Petroleum Association, which echoed COGA's concerns about the rules, was equally conciliatory following Sunday's vote.
"We appreciate all the work the Commission did. They listened attentively to all of the parties and all of the alternative proposals," Dempsey said. "We respect the Commission's decisions and we'll work through the questions that we still may have."