RSS FEEDSAPRIL 19, 2012
The Facts about Fracking and Physicians
Yesterday's statement by the Pennsylvania Medical Society President Marilyn Heine should put to rest the recent panic over a provision in Act 13—the newly enacted Marcellus Shale legislation (HB 1950)—addressing physicians' access to chemical information used during hydraulic fracturing.
Dr. Heine stated [emphases added]:
As physicians, our first priority is the health of our patients. We applaud the Corbett administration and the legislature for enacting a law that forces natural gas drillers to publicly disclose the chemicals they use as part of the hydraulic fracturing process. More importantly, language in Act 13 demonstrates their concern for public safety by empowering physicians, when they need to treat patients, with the ability to obtain from drilling companies "proprietary chemical compounds" not otherwise publicly disclosed.
...We are gratified by the strong public assurances from the Department of Health, Speaker Smith and House Majority leader Mike Turzai that their intent in drafting the law was for physicians to be able to speak freely with their patients, other health care providers involved in the care of their patients, and appropriate public health officials. Those statements clearly demonstrate their commitment to the health and welfare of all Pennsylvanians.
Act 13 was not written to create a barrier between physicians and their ability to treat patients. It was intended to and does just the opposite—ensures the medical community has access to any and all information to best care for their patients.
Moreover, the language in Act 13 addressing chemicals used in hydraulic fracturing is being called "the most progressive disclosure requirements in the nation." It's unfortunate that instead of celebrating this accomplishment, anti-drilling groups try to drum up fear even when it's unmerited.
posted by KATRINA CURRIE | 03:16 PM | 0 comment
APRIL 4, 2012
Marcellus Shale: Pennsylvania's Manna From Heaven
Yesterday, the American Chemistry Council (ACC) and the Pennsylvania Chemical Industry Council hosted a forum on the benefits of natural gas for Pennsylvania's manufacturing sector.
David Taylor of the PA Manufacturers' Association commented that Marcellus Shale is the closest thing Pennsylvania will get to "manna from heaven." On top of creating tens of thousands of jobs in Marcellus Shale related industries, lowering utility bills, and generating fortunes for farmers, workers and small-business owners, shale drilling is helping to revitalize the manufacturing industry.
As the chart below highlights, ethane, a byproduct of natural gas development, is used to make a host of manufacturing products. The ACC credits the construction of new chemical plants, including Shell's proposed Pennsylvania cracker plant that's expected to generate 17,000 new jobs, to "affordable and abundant domestic shale gas."
Abundant natural gas production has significantly reduced the energy costs associated with manufacturing. However, the panelists were clear that this is a competitive market, and Pennsylvania should continue to address its business climate -- the commonwealth has the 10th highest state and local tax burden out of the 50 states -- and refrain from hand outs to politically favored companies, ensuring businesses compete on a level playing field.
posted by KATRINA CURRIE | 10:28 AM | 1 comment
MARCH 23, 2012
Energy Essential to Economic Growth
The World Economic Forum has a released an updated study on energy and economic growth in the US and guess what sector plays a huge role? That's right, shale gas.
Watch this WEF video for a quick overview.
The study finds that the oil and gas industries added 150,000 jobs in 2011 alone. That's 9 percent of total job growth nationwide. And these jobs are higher paying than many other sectors with an average wage of $28.30 per hour.
A key statistic for measuring an industry's impact on the economy is the "employment multiplier." The WEF rates unconventional natural gas (e.g., Marcellus Shale) jobs at a multiplier of 3.2, meaning that for every direct job in the industry, 3.2 indirect and induced jobs are created in the overall economy. Bradford County hotels, for example, experienced a 100 percent increase in sales during 2010 with ripple effects felt in financial, construction, transportation and other industries.
The study's punch line? "The shale gas industry alone employs 600,000 people in the United States," and the oil and gas sector is projected to grow at 6.9 percent through 2015. In short, count on natural gas development to remain a dynamic job creator in Pennsylvania's economy for years to come, so long as over regulation is kept at bay.
posted by JOHN BOUDER | 01:33 PM | 0 comment
MARCH 19, 2012
Is Corporate Welfare for Shell Cracker Good for PA?
Astute readers may remember that last month Pennsylvania earned the dubious distinction of the highest taxes for mature businesses and the second highest taxes for new businesses. So how did Pennsylvania just beat out Ohio and West Virginia for the Shell Oil Co. cracker plant that is estimated to create more than 10,000 construction and 10,000 permanent jobs?
The Post Gazette has the answer, "Gov. Tom Corbett and his closest advisers spent months wooing the company." In other words, corporate welfare. Pennsylvania's corporate taxes are so awful that the Corbett administration had to wine and dine company officials and hand over special tax exemptions and subsidies to seal the deal.
Eventually the administration discovered some Shell executives were fans of the Steelers and treated them to a game at Heinz Field. The Post Gazette reports executives were even given a glimpse of the locker room. Good thing West Virginia doesn't have an NFL team and the Cleveland Browns. . . well we all know that story.
On the policy side, the General Assembly voted in February to expand Keystone Opportunity Zones (areas which exempt businesses from taxes) for businesses that invest at least $1 billion and create at least 400 permanent, full-time jobs. Legislators also implemented a natural gas impact tax, about $10 million of which will be used to subsidize projects like the Shell plant.
While the Shell decision seems like good news, the truth is tax breaks and corporate welfare merely mask and exacerbate the problems with our business taxes and regulations.
If Governor Corbett and the General Assembly want to attract jobs they need to stop making exceptions for large corporations and improve the business climate for all businesses. Indeed, lawmakers should take the lesson from the Keystone Opportunity Zones—that businesses are attracted to lower taxes—and apply it statewide.
posted by ELIZABETH STELLE | 10:49 AM | 0 comment
MARCH 16, 2012
For Dimock, The Verdict Is In
In an update to the ongoing saga of federal overreach in Dimock, Pa., the Environmental Protection Agency has released results of drinking water testing at 11 area homes that activists claim were polluted by natural gas drilling.
Earlier this year, the EPA abruptly stepped in to supply drinking water to some of the homes in question, despite the conclusion by Pennsylvania's Department of Environmental Protection that any concerns had been resolved by the installation of water treatment systems paid for by the drilling company. The issue has since been used as a scare tactic by celebrity anti-fracking activists calling into question the safety of the entire gas drilling industry.
Today, the verdict is in and no less than the Sierra Club has expressed disappointment that tests, "failed to show elevated levels of contamination," confirming DEP's initial conclusion. Maybe next time the EPA will think before they act, and avoid disrupting local economies like Dimock's, which has faced a costly drilling moratorium throughout the investigation.
posted by JOHN BOUDER | 05:04 PM | 0 comment
MARCH 13, 2012
Fighting Fiction with Fracking Facts
Yesterday, I had the pleasure of speaking to Tea Party Patriots of Central Pa on environmental aspects of natural gas drilling in Pennsylvania and new Marcellus Shale regulations and taxes in Act 13 (formerly House Bill 1950).
I was joined by the talented journalist and documentary filmmaker Ann McElhinney - she produced Not Evil Just Wrong, a response to Al Gore's An Inconvenient Truth. Ann was talking about her new project FrackNation, a documentary that will tell the truth about fracking. You can learn more about FrackNation here.
PA Marcellus Shale Presentation
posted by KATRINA CURRIE | 02:19 PM | 1 comment
MARCH 5, 2012
Utility Rates Drop Again Thanks to Marcellus Drilling
Natural gas drilling is continuing to provide significant savings for Pennsylvania families across the state through lower electricity and natural gas prices.
Last week, PPL Electric Utilities, servicing eastern Pennsylvania, dropped its residential rates nearly 11 percent. As the Philadelphia Inquirer explains, customers using 1,000 kWh a month will save $8.84. That's an extra $106 a year!
Southeastern counties serviced by UGI Utilities will see even lower natural gas bills. On the tail of its 13.5 percent rate reduction for residents in December, the company announced another 4.3 percent drop this week. All in all, UGI estimates its 570,000 customers are saving $300 million annually compared to gas prices in 2008, an average of $526 each.
Additionally, residential customers using Philadelphia Gas Works just saw prices fall by 6.6 percent this week, which it credits to the abundance of natural gas drilling.
posted by KATRINA CURRIE | 00:40 PM | 0 comment
FEBRUARY 21, 2012
DRBC Moratorium Puts Residents' Property Rights in Limbo
Wayne County land owners in favor of natural gas drilling are fed up with the Delaware River Basin Commission's baseless moratorium on fracking. The commission has suspended natural gas development in the northeast corner of Pennsylvania since May 2010, depriving residents of income from gas leases and squelching the economic boom seen in neighboring counties.
The DRBC has provided no scientific justification to hold hostage the economic advancement of an entire region. They appear to be bowing to the pressure of anti-fracking propaganda, citing vague "potential dangers and consequences" as their excuse and providing no timeline for a resolution to the issue.
Pennsylvania already has stringent regulations in place that have proven demonstrably effective in thousands of gas wells across the state. Area landowners have organized as the Northern Wayne Property Owners Alliance and are pursuing legal action to reinstate their constitutional property rights. The Delaware River Basin Commission should lift the fracking moratorium and uncap economic development.
posted by JOHN BOUDER | 10:49 AM | 0 comment
FEBRUARY 15, 2012
Which County will be Duped into Imposing Marcellus Tax?
On Monday, Gov. Tom Corbett signed House Bill 1950, the Marcellus Shale impact tax, into law.
The funding formula funnels the first $23 million in revenue to statewide programs. Local communities get 60 percent of whatever is left, with the state getting the rest for additional programs. To see the revenue distribution chart, click here.
With Harrisburg politicians' pet projects getting a large chunk of the initial revenues, county officials face a "Prisoners' Dilemma." The first county to enact the tax will send the funds to Harrisburg. If a county acts alone in imposing the tax, they risk reaping less than $23 million and getting nothing in local revenue.
About 460 Marcellus wells need to be taxed this year to feed the state its $23 million. According to State Impact PA, only three counties (Bradford, Tioga, and Washington) have enough producing wells currently to generate more than $23 million. And already, Bradford County commissioners - where the lion's share of drilling is occurring - have said "no thanks" to a new tax. The commissioners note the county already received ample revenue from drillers in the form of taxes and road repairs.
The question remaining is which county will be first to tax its wells, knowing they may drive drillers away without receiving a nickel for local coffers?
posted by KATRINA CURRIE | 01:30 PM | 0 comment
FEBRUARY 9, 2012
Marcellus Shale Bill Summarized
Gov. Corbett is expected to sign HB 1950, a comprehensive bill addressing Marcellus Shale. What's inside the bill?
The Marcellus Shale impact tax included in HB 1950 falls short of being a principled impact fee. However, it is a victory for Pennsylvania workers and land owners that this was not imposed at the state level. Instead it allows counties to choose whether or not to enact the tax, which will hopefully create important tax competition. Some counties have already said current relationships between government and the companies are already compensating for impacts.
One of the more negative aspects of the bill is that it is littered with corporate welfare. The graph below demonstrates how the revenue from the impact tax will be distributed. Right off the bat, an assortment of local and statewide programs are funded. The leftover revenue is split up with only 60% staying local and 40% going, again, statewide with much of the revenue going to non-drilling related projects.
The bill also significantly increases drilling regulations and bonding requirements. Here's a synopsis of those changes:
| Marcellus Shale Regulatory Changes | ||
| Environmental Protection and Oversight | Old Regulations | New Regulations |
| Bond (per well) | $2,500 | $4000 per well under 6000 feet; increase per number of wells; $10,000 per well for depths of 6,000 feet or greater |
| Blanket Bond | $25,000 | Up to $250,000 for wells under 6,000 feet and up to $600,000 for wells over 6,000 feet |
| Setbacks from Private Water Wells | Wells may not be drilled within 200 feet | May not be drilled within 500 feet |
| Setbacks from Public Water Supply Systems | 200 feet for waste pits and impoundments | May not be drilled within 1,000 feet of existing supply extraction point |
| Setbacks from Buildings | Wells may not be drilled within 200 feet of existing occupied structures, unless consent or | Unconventional wells may not be drilled (well bore) within 500 feet of existing occupied structure, unless consent or variance |
| Presumed Liability for Impaired Water Supply | Private water supplies within 1,000 feet of well | Private water supplies within 2,500 feet |
| Duration of Presumed Liability for Impaired Water Supply | six months | One Year |
| Water Supply Restoration Obligations | Restore or replace with adequate quantity and quality | Restore or replace affected water supplies to assure compliance with PA Safe Drinking Water Act standards |
Finally, the bill restricts local governments' ability to target drilling through zoning and other regulations. Local governments retain the authority to pass ordinances (noise, lighting, etc.) so long as they don't single out gas drilling. If a county's ordinances doesn't allow for the reasonable development of drilling (decided by the Public Utility Commission or the courts), that county won't be eligible for impact tax revenue.
posted by KATRINA CURRIE | 06:15 PM | 0 comment
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