3. Availability of Equipment and Trained Personnel

Comment: Commenters state that the supply of REC equipment 

and personnel is insufficient to meet the requirements of the 

proposed rule, applied nationally. According to commenters, 

proper surface equipment, collection infrastructure and 

qualified personnel are not readily available; they assert that 

this equipment is fairly specialized, the shops licensed to make 

it are limited and some of the components require a long lead 

time. For these reasons, commenters indicate that compliance by 

the issuance date of the rule would be unrealistic and that the 

EPA should provide a longer compliance period.

Response: Based on information submitted by commenters, we 

have reason to believe that, currently, there is already 

significant demand for REC equipment. For example, Colorado, 

Wyoming, the City of Fort Worth, Texas, and the City of 

Southlake, Texas, require REC under certain conditions. 

Additionally, public comments, reports to the EPA’s Natural Gas 

STAR Program and press statements from companies indicate that

some producers implement REC voluntarily, based upon economic 

and environmental objectives. If REC were to be immediately 

required, NSPS would place significant additional demands on REC 

equipment supply and experienced personnel.

As the near-term supply of REC equipment and trained 

personnel will be insufficient to meet the new national demand 
for equipment and labor, immediate compliance with the REC 

requirements could be impossible, potentially causing producers 

to delay well completions until appropriate equipment and labor 

are available. Resulting delays in well completions while 

awaiting equipment availability could cause a decrease in the 

nationwide natural gas supply and would drive up the cost of 

completions doing RECs. It is not the EPA’s intent to set in 

motion a series of events through this rule that has the 

potential to affect the natural gas supply and increased cost of 

REC would undermine our BSER analysis. Accordingly, it is 

important that the EPA consider the availability of REC 

equipment and personnel in its BSER analysis.

The EPA received data on the current and future supply of 

REC equipment. According to one commenter, about 300 REC units 

are in use today, with the ability to process about 4,000 wells 

per year, and 1,300 additional units would be required to 

perform 20,000 REC per year. About 1,600 units performing 20,000 

REC/year implies a REC productivity rate of about 12.5 

REC/year/unit, or roughly each unit performing one REC per 

month, on average. 

The NSPS proposal estimated 9,300 REC performed for new 

natural gas well completions and 12,200 REC performed for 

existing natural gas well completions following refracturing 

would be required, in addition to those already required by 
state regulations. In the analysis supporting the final rule, 

the EPA revised estimates show 12,375 hydraulically fractured 

well completions will be performed in a representative year, 

which includes completions in states which currently have REC 

requirements. Of the total hydraulically fractured well 

completions, the EPA estimates that about 9,500 REC will be 

required nationally on the basis of the final rule’s provisions 

for wildcat (exploratory) and delineation wells, flowback gas 

pressure, and natural gas well completions conducted on existing 

gas wells that are subsequently fractured or refractured. This 

estimate includes REC required by state regulations.

Assuming a REC unit performs 12.5 REC/year, as is asserted 

by the commenter, about 760 units would be required. This

implies a current shortfall of about 460 units, based upon the 

numbers and assumptions provided by the commenter. The commenter 

states that industry can deliver about 50 units per quarter, 

after a 1-year build-up period. Given the EPA does not have an 

alternative estimate of the number of REC units industry can 

produce per year, we adopt the estimate of 50 units per quarter 

for this analysis, although the EPA disagrees with the 

assumption that a 1-year build-up period is required. Using the 

commenter’s assumptions, it would take about 3.5 years to meet 

demand. This scenario is depicted in Scenario A in Table 2 

below, assuming compliance is initiated at the beginning of the 
second quarter, 2012, and the industry begins delivering 50 

units per quarter roughly 1 year after the compliance date.

Surveys conducted by one commenter indicate that nine 

companies expect to perform more REC than the current stock is 

capable of. Given this growing demand, it is reasonable to 

assume industry can deliver units during the buildup period of 

the first year of implementation, which would reduce the time 

required to meet full demand another year to a total of about 

2.5 years (Scenario B).

The EPA also assessed whether the productivity of equipment 

in use could be higher than the 12.5 REC/year/unit derived from 

the comment, and the potential impact of such increase on the 

equipment supply. The EPA estimated that flowback periods will 

typically be 3 to 10 days with 7 being a reasonable average.

Therefore, because it is likely that a REC unit could be moved 

to another well site and be in operation in less than 20 to 27 

days, it is reasonable to conclude that each REC unit can 

perform more than 12.5 REC/year.

If the utilization rate of REC units is increased gradually 

from performing 12.5 REC/year/unit to 14 to 18 REC/year/unit, 

the time required to build the supply of REC units decreases 

(Scenarios C-G). As the Table 2 shows, each 1 REC/year/unit 

increase reduces the buildup time by about 1 quarter. As is 

shown in Scenarios C and G, increasing the utilization rate of 
REC to 14 to 18 REC/unit/year with industry supplying new units 

beginning with the compliance date would provide between 1.25 

and 2 years for full build out of the REC unit supply.

Table 2. REC Unit Supply Analysis

Scenario A B C D E F G

RECs Required 9,523 9,523 9,523 9,523 9,523 9,523 9,523

RECs/year/unit 12.5 12.5 14.0 15.0 16.0 17.0 18.0

Units Needed 762 762 680 635 595 560 529

Stock in Existence (assume industry can build 50 units/quarter; assuming 

industry starts with 300 units); compliance begins approximately at the end 

of the second quarter, 2012.

Scenario A B C D E F G

2012 (Q1) 300 300 300 300 300 300 300

2012 (Q2) 300 300 300 300 300 300 300

2012 (Q3) 300 350 350 350 350 350 350

2012 (Q4) 300 400 400 400 400 400 400

2013 (Q1) 300 450 450 450 450 450 450

2013 (Q2) 300 500 500 500 500 500 500

2013 (Q3) 350 550 550 550 550 550 550

2013 (Q4) 400 600 600 600 600 600

2014 (Q1) 450 650 650 650

2014 (Q2) 500 700 700

2014 (Q3) 550 750

2014 (Q4) 600 800

2015 (Q1) 650

2015 (Q2) 700

2015 (Q3) 750

2015 (Q4) 800

Because of uncertainties in the supply of equipment and 

labor over the near-term, and based on our analysis described 

above, the EPA concludes that REC may not always be available 

during the first 2 years after the promulgation of the NSPS. 

Therefore, during the first 2 years, the BSER for well 

completions is to combust completion emissions. REC with 
combustion as an alternative to combustion is permitted by the 

rule so that facilities that are able to obtain REC equipment 

may still capture completion emissions using a REC. After the 

initial 2-year period, capturing completion emissions using a 

REC will be considered BSER. This 2-year period will permit the 

companies producing REC units to increase production to levels 

sufficient to meet new demand. In addition, because more REC 

will be performed as a result of this rule, the EPA believes

that producers will take advantage of scale economies and use 

REC units at a higher rate of productivity than the rate implied 

by comments received.

The EPA believes that the NSPS, as finalized, will minimize 

the risks of producers slowing well completion-related 

activities to obtain appropriate equipment and labor. While 

there would be NOx formation as a result from the additional 

combustion of completion emissions during the phase-in period,

VOC emissions reductions would be maintained because completion 

emissions will be either combusted or captured. The EPA 

maintains that the benefit of the VOC reduction during the 

phase-in period far outweighs the secondary impact of NOx

formation during pit flaring. The phase-in period would also 

minimize the possibility that the cost of REC equipment and 

labor increases over the near-term, enabling producers to better 

plan efficient use of existing and new capital and labor, and 
providing additional time for innovation in REC technologies

and/or practices.

We believe this period provides ample time for this 

technology to be built and available for use. The EPA will 

monitor the availability of equipment during this 2-year period 

and take action as necessary.