Oil and gas regulation in Colorado

Methane requirements 

In February 2014, Colorado became the first to establish methane emissions targets for the oil and gas sector. This rule also set requirements for the design, operation, and maintenance of well production facilities and created new leak detection and repair requirements for upstream and midstream operations. These policies helped shape the U.S. EPA’s 2016 and 2018 methane rules. The programs created in 2014 evolved over several more rulemakings between 2016 and 2023, which also influenced the U.S. EPA’s 2024 methane rule.  

Infrared cameras

In July 2016, the CDPHE Air Pollution Control Division published its findings after a two-year pilot study to identify and address sources of emissions leak and venting at well production facilities. The division completed 4,474 inspections using optical gas imaging infrared cameras between 2013 and 2015. These specialized cameras show the presence of methane, hydrocarbon, and other gas while equipment or pipelines operate. The division found that the use of the infrared cameras helped oil and gas operators to prevent and address these sources of emissions. By the end of the study, the division found that a facility’s leak and vent rate decreased to an average of 9% from 42%.

The success of the study allowed the division to permanently include the use of infrared cameras as part of its air quality compliance oversight activities. 

Strengthening local control and public safety

In July 2019, the Colorado legislature passed the Protect Public Welfare Oil and Gas Operations law. This bill significantly changed the state’s regulatory approach to the industry, placing a higher focus on increasing public safety and lowering emissions of greenhouse gases and other pollutants. 

The bill empowered local governments to be more active in overseeing oil and gas operations, marking a shift toward more comprehensive and community-centered regulatory practice. The bill revised the authority and mission of the Colorado Oil & Gas Conservation Commission. Instead of fostering oil and gas development, the commission was now tasked with regulating oil and gas development and production in a manner that protects public health, safety, welfare, the environment, and wildlife resources. 

The legislature also granted the Colorado Department of Public & Environment with the authority to regulate greenhouse gas emissions. This decision has significantly increased the state’s ability to lower its greenhouse gas emissions. 

Reduction targets for oil and gas emissions

In July 2019, Colorado established the first statewide greenhouse gas reduction goals. The Colorado Air Quality Control Commission further expanded on these goals in 2020 by breaking down those targets across various economic sectors, including the oil and gas industry. Since then, Colorado lawmakers have passed several bills that have enhanced the state’s reduction goals and targets. 

As of July 2021, the oil and gas sector is required to reduce its greenhouse gas emissions by at least 36% by 2025, and 60% by 2030, relative to 2005 emissions levels. The latest state greenhouse gas inventory report shows the industry is on track to achieve even further reductions by those deadlines. The state has made progress on this sector’s reduction goals by implementing actions from the Colorado Greenhouse Gas Pollution Reduction Roadmap.

Colorado Environmental Justice Act

In July 2021, state lawmakers passed the Colorado Environmental Justice Act. This historic law recognized that “all people have a right to breathe clean air, drink clean water, participate freely in decisions that affect their environment, live free of dangerous levels of toxic pollution, experience equal protection of environmental policies, and share the benefits of a prosperous and vibrant pollution-free economy.”

The bill also acknowledged that there are disproportionately impacted communities in Colorado that have been forced to bear the adverse effects of pollution. As a result, this law required all future rulemakings to take into account environmental justice, prioritizing reductions of pollutants in these communities over time. 

Greenhouse gas intensity program

In December 2021, the Colorado Air Quality Control Commission introduced its first greenhouse gas rule for the oil and gas sector, establishing “intensity” requirements for upstream facilities. “Intensity” refers to the ratio of how much greenhouse gas emissions are emitted per barrel of oil and gas produced. This rule essentially requires operators to become more efficient at reducing their greenhouse gas emissions per each barrel of oil they produce.

Colorado became the first U.S. in July 2023 to establish an intensity verification rule, ensuring methane emissions accounted for in intensity calculations. 

Midstream combustion fuel equipment rulemaking

In December 2024, Colorado adopted a first-of-its-kind rule to reduce greenhouse gas emissions from midstream oil and gas operations. “Midstream” refers to facilities that gather, compress, and process natural gas, such as compressor stations and processing plants. The rule focuses on lowering emissions from midstream fuel combustion equipment such as engines, turbines, and heaters. 

Phase out of natural-gas driven pneumatic devices

In February 2025, the Colorado Air Quality Control Commission approved measures to phase out the use of natural gas-driven pneumatic devices at oil and gas facilities statewide. This phase out timeline is more stringent than the March 9, 2029 deadline under federal requirements. Oil and gas operators with facilities located in Colorado areas that do not meet federal health standards for ground-level ozone pollution must phase out the use of these devices even more quickly.