Trump Dumps Climate Regulation

Transatlantic Policy Divergence:

Analysis of US EPA Endangerment Finding Rescission

Implications for UK Energy Policy & Domestic Gas Utilisation: Date: 13 February 2026

Executive Summary

On 12 February 2026, the United States Environmental Protection Agency (EPA) formally rescinded the 2009 Endangerment Finding, removing the scientific and legal foundation for federal regulation of carbon dioxide, methane, and four other greenhouse gases. This action, described by EPA Administrator Lee Zeldin as the "largest act of deregulation in the history of the United States," represents a fundamental shift in the world's largest economy's approach to climate policy.

This report examines the technical, economic, and policy implications of this transatlantic divergence, with particular focus on methane from domestic gas fields and the impact on UK decentralised energy policy. The analysis reveals significant competitive disadvantages for UK industry and fundamental questions about the scientific basis currently informing UK regulatory frameworks.

1. Background: The 2009 EPA Endangerment Finding

1.1 Original Regulatory Framework

The EPA Endangerment Finding, established under the Obama administration in 2009, made three core determinations:

1. Six greenhouse gases (carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulphur hexafluoride) were classified as air pollutants under the Clean Air Act;

2. These gases were determined to "endanger public health and welfare of current and future generations";

3. The EPA possessed legal authority to regulate these emissions from vehicles, power plants, and industrial facilities.

This determination provided the legal foundation for comprehensive climate regulations affecting automotive standards, power generation, oil and gas operations, and broader industrial emissions.

1.2 The February 2026 Rescission

The Trump administration's rescission rests on two primary arguments:

Legal Authority: The EPA argues that the Clean Air Act does not grant authority to regulate greenhouse gases, and that the Obama administration exceeded its statutory mandate. The determination was characterised as "flawed and unorthodox" with respect to statutory interpretation.

Scientific Reassessment: The current EPA administration has questioned the underlying scientific consensus. The Department of Energy's July 2025 review notably challenged climate orthodoxy, finding that elevated atmospheric CO₂ levels improve plant water-use efficiency. President Trump stated explicitly: "I tell them, don't worry about it, because it has nothing to do with public health. It just was all a scam, a giant scam."

The rescission eliminates requirements to measure, report, certify, and comply with federal greenhouse gas emission standards for motor vehicles through model year 2027, with broader implications for power generation and industrial operations to follow.

2. The UK Regulatory Landscape: A Contrasting Approach

2.1 Current UK Climate Framework

The United Kingdom maintains arguably the world's most aggressive climate regulatory framework, coordinated through:

Department for Energy Security and Net Zero (DESNZ): Under Secretary of State Ed Miliband, DESNZ has committed to achieving net zero emissions by 2050 with an interim 68% reduction target by 2030 (from 1990 levels). The department's approach treats greenhouse gas theory as scientifically incontrovertible.

Office of Gas and Electricity Markets (Ofgem): Ofgem has implemented extensive regulations requiring energy suppliers to source increasing proportions of renewable generation, impose carbon levies, and phase out natural gas infrastructure in favour of heat pumps and hydrogen conversion.

Climate Change Committee (CCC): The independent CCC sets binding carbon budgets that drive regulatory policy across all economic sectors.

2.2 Cost Burden to UK Economy

The Office for Budget Responsibility (OBR) estimates the net zero transition will cost the UK economy between £1.2-1.4 trillion through 2050. The EPA estimates its rescission will eliminate $1.3 trillion in regulatory costs from the US economy. This creates a stark competitive asymmetry.

Current UK policy imposes:

• Carbon Price Support (CPS) mechanism adding £18/tonne to fossil fuel generation;
• Renewable Obligation Certificates (ROCs) increasing consumer electricity costs by approximately 9%;
• Feed-in Tariff (FiT) legacy costs continuing through 2040s;
• Contracts for Difference (CfD) guaranteeing above-market prices for renewable generators;
• Ban on new petrol/diesel vehicle sales from 2030 (delayed to 2035);
• Phase-out of gas boilers in new builds from 2025.

3. The Methane Question: Implications for UK Gas Fields

3.1 UK Domestic Gas Resources

The United Kingdom possesses substantial natural gas reserves:

Despite these resources, UK gas production has declined from 108 billion cubic metres (bcm) in 2000 to approximately 35 bcm in 2024, while consumption remains at ~75 bcm annually. The deficit is met through imports from Norway, Qatar, and increasingly from United States LNG terminals.

3.2 Methane: The Regulatory Paradox

Current UK policy creates a striking paradox regarding methane:

Domestic Production Constraints: UK operators face stringent methane emission monitoring, leak detection requirements, and carbon pricing mechanisms. The Oil and Gas Authority (now North Sea Transition Authority) requires operators to demonstrate alignment with net zero, effectively constraining production from domestic fields.

Import Dependency: The UK imports approximately 40 bcm of natural gas annually. This imported gas is subject to the same combustion emissions once burned, but the extraction and transportation emissions occur outside UK regulatory jurisdiction and are not accounted for in UK emission inventories.

LNG Transport Emissions: Liquefied natural gas (LNG) shipments from the United States involve energy-intensive liquefaction, transportation across 3,000+ nautical miles, and regasification. Total supply chain emissions for US LNG delivered to UK terminals are estimated at 20-30% higher than equivalent domestic production, yet this differential is not reflected in UK climate accounting.

3.3 US Deregulation Impact on UK Gas Markets

The EPA's rescission of methane regulation has immediate market implications:

• US natural gas producers face elimination of leak detection and repair (LDAR) requirements, reducing operational costs;
• Reduced compliance costs make US LNG more competitive in European spot markets;
• UK domestic producers face increasing cost disadvantage versus deregulated US competitors;
• UK policy incentivises importing gas from jurisdictions with lower environmental standards than could be achieved domestically.

4. Decentralised Energy: The Case for Domestic Gas Utilisation

4.1 Principles of Decentralised Generation

Decentralised energy systems generate power close to point of use, reducing transmission losses and improving grid resilience. In the UK context, natural gas-fired combined heat and power (CHP) systems offer:

• Overall system efficiencies of 80-90% (versus 45-50% for centralised CCGT);
• Reduced transmission and distribution losses (typically 7-10% of centralised generation);
• Grid stability during peak demand periods;
• Energy security through distributed generation assets.

4.2 Current Policy Barriers

UK decentralised gas generation faces multiple regulatory obstacles rooted in greenhouse gas theory:

Carbon Price Floor: The £18/tonne CPS applies to all fossil fuel generation regardless of efficiency. A highly efficient CHP system pays the same carbon price as an inefficient baseload plant, eliminating the efficiency advantage.

Capacity Market Distortions: Renewable generators receive preferential treatment in capacity auctions, while gas-fired CHP faces derating factors that undervalue reliability benefits.

Gas Boiler Ban: From 2025, new buildings cannot install gas boilers, eliminating the heat load essential for CHP viability. This regulation presumes that grid electricity (with transmission losses and intermittency backup) is environmentally preferable to efficient on-site gas utilisation.

Planning Restrictions: Local authorities increasingly refuse planning permission for gas-connected developments based on climate objectives, regardless of system efficiency or carbon intensity relative to alternatives.

4.3 Alternative Scenario: US-Style Deregulation

If UK policy adopted the US EPA's position that methane emissions do not endanger public health:

• Carbon pricing mechanisms (CPS, UK ETS) would lack legal foundation;
• Domestic gas field development could proceed on economic merit without climate-based restrictions;
• CHP and decentralised generation would compete on efficiency and economics alone;
• Consumer energy costs would fall by elimination of policy costs (estimated £150-200 annually per household);
• UK industrial competitiveness would improve relative to current trajectory.

5. Scientific and Policy Questions Arising

5.1 The "Settled Science" Paradox

UK policy discourse treats anthropogenic climate change as scientifically incontrovertible, frequently citing "97% consensus" among climate scientists. However, the US EPA - equipped with substantial scientific resources, access to identical peer-reviewed literature, and subject to the same international scientific community - has reached the opposite regulatory conclusion.

This creates several uncomfortable questions:

Question 1: If the greenhouse gas hypothesis represents settled, incontrovertible science, how can a major scientific regulatory body formally determine the opposite?

Question 2: Does the UK government accept the EPA's scientific determination? If not, on what basis does it reject findings from a peer regulatory agency?

Question 3: If the UK maintains its regulatory framework while the US eliminates equivalent rules, what mechanism ensures this divergence serves UK national interests rather than simply displacing economic activity?

5.2 Department of Energy Carbon Dioxide Findings

The US Department of Energy's July 2025 review represents a significant challenge to climate orthodoxy. The finding that elevated atmospheric CO₂ improves plant water-use efficiency contradicts the uniformly negative framing in UK policy documents.

This raises the question: are UK policymakers aware of research suggesting potential benefits from increased atmospheric CO₂? If so, how is this incorporated into cost-benefit analysis? If not, does this represent a gap in the evidence base informing trillion-pound policy commitments?

5.3 Economic Competitiveness Implications

The EPA estimates its deregulation will save the American economy $1.3 trillion. The UK is committed to spending £1.2-1.4 trillion on net zero. This creates a £2.5 trillion competitive differential between economies of similar size and development level.

For energy-intensive UK industries (steel, chemicals, cement, glass), this differential translates directly to competitive disadvantage. Manufacturing facilities face a choice: absorb higher energy costs and lose market share, or relocate to jurisdictions with lower regulatory burdens.

6. Recommendations

6.1 Policy Review Requirements

Recommendation 1: Independent Scientific Review

Commission an independent review of the greenhouse gas hypothesis and its regulatory implications, given the EPA's formal rescission of its endangerment finding. This review should examine:

• The scientific evidence supporting and challenging the current UK regulatory framework;
• The US Department of Energy's findings on CO₂ benefits to plant physiology;
• The range of scientific opinion on climate sensitivity and attribution;
• Whether current policy adequately reflects scientific uncertainty.

Recommendation 2: Economic Competitiveness Assessment

Conduct comprehensive assessment of the UK's competitive position given US deregulation, including:

• Energy cost differentials for key industrial sectors;
• Capital investment flows and manufacturing location decisions;
• Long-term viability of UK manufacturing under current regulatory trajectory;
• Risk of carbon leakage to deregulated jurisdictions.

Recommendation 3: Methane Regulation Reassessment

Re-examine the regulatory treatment of methane from UK domestic gas fields, considering:

• Total supply chain emissions of domestic versus imported gas;
• Energy security implications of import dependency;
• Economic value of domestic resource development;
• Whether current restrictions serve environmental objectives or simply export emissions.

6.2 Decentralised Energy Policy Reforms

Recommendation 4: Remove Efficiency Penalties

Eliminate carbon pricing mechanisms that penalise high-efficiency CHP systems identically to low-efficiency baseload generation. At minimum, carbon pricing should reflect actual system efficiency and total emissions per unit of delivered energy.

Recommendation 5: Reverse Gas Appliance Restrictions

Suspend the gas boiler ban and restrictions on gas connections pending resolution of the broader policy questions raised by US regulatory divergence. Allow decentralised CHP to compete on merit against centralised alternatives.

Recommendation 6: Capacity Market Reform

Restructure capacity market mechanisms to value reliability and dispatchability appropriately, rather than favouring intermittent generation based on climate assumptions now questioned by the US EPA.

7. Conclusions

The US EPA's rescission of its greenhouse gas endangerment finding represents more than a regulatory policy shift - it fundamentally challenges the premise underlying UK climate regulation. The world's largest economy and historical emissions leader has formally determined that CO₂, methane, and other greenhouse gases do not endanger public health.

This determination emerges from the same scientific literature, peer-review processes, and international research community informing UK policy. Yet UK regulations proceed on precisely the opposite basis, imposing estimated costs of £1.2-1.4 trillion on the economy through 2050.

For UK decentralised energy policy and domestic gas utilisation, the implications are profound:

• Domestic gas fields face regulatory restrictions while the UK imports equivalent volumes from jurisdictions operating under lower standards;
• High-efficiency CHP systems are penalised identically to low-efficiency alternatives;
• Energy security is compromised in favour of import dependency;
• UK industry faces a growing competitive disadvantage versus deregulated American competitors.

The transatlantic divergence demands urgent policy attention. At minimum, UK authorities must explain on what basis they maintain regulations that the EPA has determined lack scientific foundation. More fundamentally, the question must be asked: does current UK climate policy serve national interests, or has it become divorced from both scientific rigour and economic reality?

The stakes - measured in trillions of pounds, industrial competitiveness, energy security, and the prosperity of future generations - demand answers.

Appendix: Key Data Points

UK Energy Statistics

• Natural gas consumption (2024): ~75 billion cubic metres
• Domestic gas production (2024): ~35 billion cubic metres
• Import dependency: ~53%
• Average household energy bill (2024): £1,928 per annum
• Policy costs as percentage of bill: ~23%
• Industrial electricity costs: 4th highest in Europe

US Regulatory Changes

• Estimated regulatory savings: $1.3 trillion
• Vehicle standards eliminated: Model years 2012-2027
• EV tax credits: Eliminated
• Paris Agreement status: Withdrawn
• Federal methane leak detection requirements: Eliminated
• Coal power plant support: New federal purchasing requirements

CHP Efficiency Data

• Typical CHP system efficiency: 80-90%
• Centralised CCGT efficiency: 45-50%
• Transmission and distribution losses: 7-10%
• Carbon emissions per kWh (CHP): ~180g CO₂/kWh
• Carbon emissions per kWh (grid average): ~220g CO₂/kWh
• Payback period (typical commercial CHP): 3-5 years at current gas prices