June 17, 2025

Petroleum and Natural Gas Waste Emissions Charge Rule Revoked

On November 18, 2024, EPA finalized the waste emissions charge (WEC) rule, a program to impose and collect fees on petroleum and natural gas facilities with high methane emissions. [89 FR 91094] The WEC rule became effective January 17, 2025, but as of March 14, through the use of the Congressional Review Act (CRA), it had no legal effect and was removed from the regulations on May 19, 2025. [90 FR 21225] Why does this matter? It is the first time in the Clean Air Act’s 55-year history that Congress has moved to weaken the power of that environmental statute.

The waste emissions charge rule

The WEC rule resulted in a new 40 CFR Part 99, a program in which an annual $/metric ton charge would be calculated and levied upon petroleum and natural gas facilities that were required to report greenhouse gas emissions under Part 98, Subpart W of more than 25,000 metric tons carbon dioxide equivalent for a reporting year. However, the details of the rule are not important to this discussion, as the rule no longer exists. What is important is understanding how the rule was removed.

Legal implications

Part 99 implemented CAA Section 136(c) [42 U.S.C. Sections 7436(c)], which was added to the CAA as part of the 2022 Inflation Reduction Act. The text of this statutory section, which is still present in the law, reads:

“WASTE EMISSIONS CHARGE.—The Administrator shall impose and collect a charge on methane emissions that exceed an applicable waste emissions threshold under subsection (f) from an owner or operator of an applicable facility that reports more than 25,000 metric tons of carbon dioxide equivalent of greenhouse gases emitted per year pursuant to subpart W of part 98 of title 40, Code of Federal Regulations, regardless of the reporting threshold under that subpart.”

The 1996 Congressional Review Act (CRA) [5 U.S.C. §§801–808] created a mechanism in which Congress may pass a joint resolution of disapproval, invalidating a federal agency’s rule and preventing that agency from issuing another rule “in substantially the same form” unless Congress authorizes the agency to do so in a subsequent law. A joint resolution holds the same legal effect as a bill, so when Congress passed House Joint Resolution 35 in February 2025, and the President signed it in March, the WEC final rule had no legal force or effect. Due to this CRA revocation, EPA issued its final rule removing Part 99 in May 2025. [90 FR 21225]

As of this writing, Congress has not passed a subsequent law in which EPA may promulgate a rule implementing CAA Section 136(c). Thus, the agency is in a position where they are legally required (from a statutory perspective) to establish a waste emissions charge program but are legally prevented (from a joint resolution perspective) from doing so. While EPA has finalized rules weakening air regulations before, the joint resolution of disapproval is the first time the U.S. legislature has weakened the CAA law. With the WEC provisions in legal limbo, it is unclear if Congress will resolve this dichotomy.

A 2021 article on the CRA states it “has been used to overturn a total of 20 rules: 1 in the 107th Congress (2001-2002), 16 in the 115th Congress (2017-2018), and 3 in the 117th Congress (2021-2022).” It appears the nullification of EPA’s WEC rule is its 21st use.

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This document addresses issues of a general nature related to the federal environmental regulations. Persons evaluating specific circumstances dealing with the environmental regulations should review state and local laws and regulations, which may be more stringent than federal requirements. In addition, the assistance of a qualified professional should be enlisted to address any site-specific circumstances.