Nearly 130 business and labor groups led by the American Petroleum Institute (API) are urging Congress to oppose a proposed tax on oil and gas methane emissions and instead push for direct federal regulation.

Senate Democrats are considering the Methane Emissions Reduction Act of 2021 for inclusion in their $3.5 trillion budget reconciliation bill. 

Introduced by Democratic Sens. Cory Booker (NJ), Sheldon Whitehouse (RI) and Brian Schatz (MI), the methane bill would levy a fee on emissions of the potent greenhouse gas (GHG) from oil and natural gas facilities.

In a letter to Senate leaders, API and its allies said the bill could have the opposite effect of what legislators intend, causing emissions to increase. API represents 600 companies in the oil and gas sector.