The Obama Administration’s “Strategy to Cut Methane Emissions,” released at the end of March, included recognition that efforts to modernize infrastructure and enhance pipeline safety have significantly contributed to a declining trend in natural gas emissions. Indeed, according to the U.S. Environmental Protection Agency’s most recent Inventory of Greenhouse Gas Emissions and Sinks, emissions from utility-owned distribution systems have dropped 22 percent since 1990 and nearly 90 percent of these emissions declines are due to the pipeline replacements utilities have completed.
Safety remains the top priority for natural gas utilities. It is a core value for the local distribution companies and their employees who live and work in the neighborhoods they serve. These utilities have delivered clean energy to homes and businesses safely and reliably for generations. They remain vigilant and deeply committed to continually upgrading infrastructure and gathering accurate information to help government, industry and other stakeholders work together to develop sound, data-driven policies for the benefit of our nation’s energy future.
An issue that is occasionally raised is the appropriateness of relying upon unaccounted for gas, sometimes referred to as LAUF or LUAF, as an indicator of natural gas emissions. Because the concept of unaccounted for gas incorporates the effects of numerous factors, including many which have nothing to do with emissions, it should not be used as an indicator or a reliable proxy to measure emissions from a natural gas delivery system.
Unaccounted for gas is a term defined for regulatory accounting purposes to represent the inevitable imbalance that exists at any given time between the measured gas coming into a utility distribution system and the measured gas going out of the same system. The cost of unaccounted for gas is calculated through accounting and ratemaking measures, and these measures differ from state to state.
Typically, at a city gate, natural gas is transferred from an interstate or intrastate pipeline to a local natural gas utility. At that moment, the utility would measure the volume of gas using sophisticated technology that is able to quickly and precisely take into account a variety of factors, including temperature, pressure and in some cases gas composition. The utility then delivers gas to homes and businesses that use it as an affordable and efficient source of energy to heat their water, warm their living and work spaces, and cook their food. Upon delivery, the utility adds up the total volume of gas sold to customers as represented on their bills and reports it to their local utility commission. The customer billing cycles occur throughout the month and typically do not match the same time period as the city-gate deliveries. The difference between the city-gate measurement and the volume of gas sold, a figure used strictly for accounting purposes, is considered unaccounted for gas. Unaccounted for gas therefore does not constitute an accurate measure of emissions.
To further support that point, the U.S. Environmental Protection Agency, which carefully tracks all greenhouse gas emissions, rejects the idea that unaccounted for gas could provide an indication of emissions or could be used to formulate policy on emissions.
There are a number of factors that can contribute to unaccounted for gas and, in an effort to bring clarity to this discussion of our shared goal of a safe, resilient, clean energy infrastructure, the American Gas Association has created this chart: