S514-119

1. Short title This Act may be cited as the Methane Emissions Reduction Program Clarifications Act of 2025 or the MERP Clarifications Act of 2025.

2. Methane emissions and waste reduction incentive program for petroleum and natural gas systems Section 136 of the Clean Air Act (42 U.S.C. 7436) is amended— in subsection (f), by adding at the end the following: The Administrator may not, pursuant to any requirement under this section, impose a reporting requirement or a charge under this section on an applicable facility described in subparagraph (B). An applicable facility referred to in subparagraphs (A), (C), and (D) is an applicable facility that, as of August 16, 2022— was generating less than 25,000 metric tons of carbon dioxide equivalent of greenhouse gases emitted per year; and had 2,500 or fewer full-time employees. The Administrator may not impose a requirement that an applicable facility described in subparagraph (B) demonstrate to the Administrator that the applicable facility meets the requirements described in that subparagraph. Not later than 60 days after the date of enactment of this paragraph, the Administrator shall provide written notice to each applicable facility described in subparagraph (B) that the applicable facility is not subject to the reporting requirements or charges imposed under this section. The Administrator shall communicate publicly (including through press releases and messages on the website of the Environmental Protection Agency) that the applicable facilities described in subparagraph (B) are not subject to the reporting requirements or charges imposed under this section. Notwithstanding any other requirement of this section, the Administrator may not impose a charge under this section on an applicable facility during any period in which the applicable facility— complies with subpart OOOOb and OOOOc, as applicable, of part 60 of title 40, Code of Federal Regulations (or successor regulations); and is located in a State in compliance with the applicable State implementation plan required under subpart OOOOc of that part (or successor regulations). by striking subsection (g) and inserting the following: The Administrator may not impose or collect the charge under subsection (c) until January 1 of the first calendar year that begins after the date on which the Administrator submits to the Committee on Environment and Public Works of the Senate and the Committee on Energy and Commerce of the House of Representatives a written notice that each of the following requirements has been met for a period of not less than 1 year before that January 1: The grants authorized under subsections (a) and (b) have been fully disbursed to all eligible recipients. The revisions to subpart W of part 98 of title 40, Code of Federal Regulations, that are required under this section— ensure the use of emissions factors that have been validated by the Administrator and posted to the website of the Administrator; and have been finalized. by redesignating subsection (i) as subsection (k); by inserting after subsection (h) the following: Except as provided in section 2(c) of the MERP Clarifications Act of 2025, any proposed regulation, rule, guidance, or directive with respect to the implementation of this section from the Administrator, the Executive Office of the President, or another Federal agency shall, consistent with subchapter II of chapter 5, and chapter 7, of title 5, United States Code (commonly known as the Administrative Procedure Act), be subject to a period of public comment of not less than 90 days. Not later than 60 days after the date of enactment of this subsection, the Administrator shall, consistent with subchapter II of chapter 5, and chapter 7, of title 5, United States Code (commonly known as the Administrative Procedure Act), propose a rule establishing an expedited process for an applicable facility to appeal or dispute the amount of a charge imposed under this section that is separate and apart from any other such process under this Act. by adding at the end the following: The authority provided under this section terminates on December 31, 2034. If this section is not reauthorized by December 31, 2034, the Administrator shall immediately cease all activities with respect to the imposition of the charge under this section. If the Administrator or the head of any other applicable Federal agency carries out any authority under this section after the date described in subparagraph (A), a party that suffers likely harm from the carrying out of that authority may seek financial compensation from the Federal Government in the appropriate Federal district court. A Federal district court shall expedite the consideration of an action described in clause (i) brought by the owner of an applicable facility with 2,500 or fewer full-time employees. On December 31, 2034, there is rescinded the unobligated balance of amounts made available under subsections (a) and (b) as of that date. Not later than 60 days after the date of enactment of this Act, the Administrator of the Environmental Protection Agency (referred to in this section as the Administrator) shall make publicly available, including on the website of the Environmental Protection Agency, an Administrator's Order that includes the following information: Consistent with the Plain Writing Act of 2010 (5 U.S.C. 301 note; Public Law 111–274) and Executive Orders 12866 (5 U.S.C. 601 note; relating to regulatory planning and review), 12988 (28 U.S.C. 519 note; relating to civil justice reform), and 13563 (5 U.S.C. 601 note; relating to improving regulation and regulatory review), an easily understandable explanation of— the methods used for calculating, for purposes of section 136 of the Clean Air Act (42 U.S.C. 7436)— the carbon dioxide equivalent of greenhouse gases emitted; methane intensity; and other emissions factors; and the key calculations necessary to understand the requirements of the program under that section, including the conversion from carbon dioxide emissions to methane emissions necessary for determining the amount of the charge imposed and collected under that section. The methods and mechanisms (including the methods and mechanisms described in subparagraph (A)(i), as applicable) used to calculate, for each category described in paragraphs (1) through (9) of subsection (d) of that section, the charge imposed and collected pursuant to subsection (c) of that section. With respect to the development of any information described in subparagraphs (A)(i) and (B)— a list of the names, including titles, occupations, and biographies, of all consultants (including international and domestic consultants) that assisted in that development; a list of the academic institutions (including any international and domestic academic institutions) that assisted in that development; and points of contact for each such academic institution; a list of the nongovernmental institutions (including any international and domestic nongovernmental institutions) that assisted in that development; and points of contact for each such nongovernmental institution; and a list of any other organizations the resources or personnel of which were used in any way in that development. A description, including citations and hyperlinks, of all studies used by the Administrator to develop the information described in subparagraphs (A)(i) and (B). A summary of all other information collected and used by the Administrator to develop the information described in subparagraphs (A)(i) and (B). In carrying out paragraph (1), the Administrator shall, in consultation with the owners and operators of applicable facilities (as defined in section 136(d) of the Clean Air Act (42 U.S.C. 7436(d)) with fewer than 2,500 full-time employees, ensure that the documentation required under that paragraph will allow operators subject to a reporting requirement or charge under section 136 of the Clean Air Act (42 U.S.C. 7436) to clearly understand the reporting requirements and calculations required under that section. Except as otherwise provided in this section or an amendment made by this section, any proposed regulation, rule, guidance, or other document required under this section or an amendment made by this section shall be subject to, as applicable— except as provided for in paragraph (2), the notice and comment provisions of section 553 of title 5, United States Code; and a public comment period of not less than 120 days. (8)Exemption for small upstream producers(A)In generalThe Administrator may not, pursuant to any requirement under this section, impose a reporting requirement or a charge under this section on an applicable facility described in subparagraph (B).(B)Applicable facilities describedAn applicable facility referred to in subparagraphs (A), (C), and (D) is an applicable facility that, as of August 16, 2022—(i)was generating less than 25,000 metric tons of carbon dioxide equivalent of greenhouse gases emitted per year; and(ii)had 2,500 or fewer full-time employees. (C)No requirement to demonstrateThe Administrator may not impose a requirement that an applicable facility described in subparagraph (B) demonstrate to the Administrator that the applicable facility meets the requirements described in that subparagraph.(D)Notification(i)Notice to facilityNot later than 60 days after the date of enactment of this paragraph, the Administrator shall provide written notice to each applicable facility described in subparagraph (B) that the applicable facility is not subject to the reporting requirements or charges imposed under this section.(ii)PublicationThe Administrator shall communicate publicly (including through press releases and messages on the website of the Environmental Protection Agency) that the applicable facilities described in subparagraph (B) are not subject to the reporting requirements or charges imposed under this section.(9)Exemption for certain producersNotwithstanding any other requirement of this section, the Administrator may not impose a charge under this section on an applicable facility during any period in which the applicable facility—(A)complies with subpart OOOOb and OOOOc, as applicable, of part 60 of title 40, Code of Federal Regulations (or successor regulations); and(B)is located in a State in compliance with the applicable State implementation plan required under subpart OOOOc of that part (or successor regulations).; (g)PeriodThe Administrator may not impose or collect the charge under subsection (c) until January 1 of the first calendar year that begins after the date on which the Administrator submits to the Committee on Environment and Public Works of the Senate and the Committee on Energy and Commerce of the House of Representatives a written notice that each of the following requirements has been met for a period of not less than 1 year before that January 1:(1)The grants authorized under subsections (a) and (b) have been fully disbursed to all eligible recipients.(2)The revisions to subpart W of part 98 of title 40, Code of Federal Regulations, that are required under this section—(A)ensure the use of emissions factors that have been validated by the Administrator and posted to the website of the Administrator; and(B)have been finalized.; (i)Public comment periodExcept as provided in section 2(c) of the MERP Clarifications Act of 2025, any proposed regulation, rule, guidance, or directive with respect to the implementation of this section from the Administrator, the Executive Office of the President, or another Federal agency shall, consistent with subchapter II of chapter 5, and chapter 7, of title 5, United States Code (commonly known as the Administrative Procedure Act), be subject to a period of public comment of not less than 90 days.(j)Dispute resolution procedureNot later than 60 days after the date of enactment of this subsection, the Administrator shall, consistent with subchapter II of chapter 5, and chapter 7, of title 5, United States Code (commonly known as the Administrative Procedure Act), propose a rule establishing an expedited process for an applicable facility to appeal or dispute the amount of a charge imposed under this section that is separate and apart from any other such process under this Act.; and (l)Sunset(1)Termination of effectivenessThe authority provided under this section terminates on December 31, 2034.(2)Continued imposition of waste charge(A)In generalIf this section is not reauthorized by December 31, 2034, the Administrator shall immediately cease all activities with respect to the imposition of the charge under this section.(B)Enforcement(i)In generalIf the Administrator or the head of any other applicable Federal agency carries out any authority under this section after the date described in subparagraph (A), a party that suffers likely harm from the carrying out of that authority may seek financial compensation from the Federal Government in the appropriate Federal district court.(ii)Expedited reliefA Federal district court shall expedite the consideration of an action described in clause (i) brought by the owner of an applicable facility with 2,500 or fewer full-time employees.(3)RescissionOn December 31, 2034, there is rescinded the unobligated balance of amounts made available under subsections (a) and (b) as of that date..