The Senate Environmental Resources and Energy Committee voted Tuesday to report the nomination of John Quigley as Secretary of the Department of Environmental Protection to the full Senate without recommendation.
Sen. John Yudichak (D-Luzerne), Minority Chair of the Committee, said he was disappointed in the motion to report the nomination with no recommendation, but said he would vote for the nomination so it can be moved to the full Senate.
Here’s a quick summary of the issues raised during the hearing--
-- PennFuture Connection: Sen. Gene Yaw (R-Lycoming), Majority Chair of the Committee, asked whether Quigley saw any conflict in being a former employee of PennFuture and now working for DEP, as well as John Hanger, the Governor’s Policy Director, and Cindy Dunn as Acting Secretary of DCNR, and carrying out his duties. Quigley said he worked for PennFuture for 21 months three years ago and did not see a conflict.
-- Impact Of Marcellus Shale Development: Sen. Yaw asked Quigley to explain a statement he made saying Marcellus Shale development will dwarf the impact of previous timber, oil and coal resource development. Quigley said we are still dealing with the impacts of unregulated coal development in thousands of miles of polluted streams and thousands of acres of abandoned mine land.
Marcellus Shale development, Quigley said, covers two-thirds of the state, but the entire state will be impacted by shale development with pipelines and other supporting facilities. Quigley noted Pennsylvania has an opportunity to write a new chapter in helping Marcellus Shale development “do it right,” demonstrating to the rest of the world how this resource can be extracted safely.
Sen. Yaw said we have environmental laws and agencies we did not have before and hoped Pennsylvania is not especially targeting the Marcellus Shale industry. Quigley said the drilling industry has gone through several generations of new technology and state government must keep up. Quigley said continuous improvement in the industry should be the same standard for state.
Sen. Scott Hutchinson (R-Venango) said he takes exception to the statement Quigley made about previous environmental impacts of timber, coal and oil and gas drilling industries. He said reluctantly there “may be” some impacts from previous coal mining, but that’s it. He said these areas now are thriving forests and beautiful. [See: Analysis: Myth- Conventional Oil and Gas Drilling Is Benign.]
Quigley said timbering 100 years ago did create significant environmental impacts and the boom and bust cycles limited economic opportunities in many communities and through initiatives like Pennsylvania Wilds these areas are starting to come back.
[Note: The timber industry clear cut hundreds of thousands of acres of forests without replanting or conservation measures that caused rivers of mud for decades in these areas. No one wanted those lands until they were bought as State Forest lands.]
Sen. Kim Ward (R-Westmoreland) asked what he means about promoting the right kind of natural gas development. Quigley said companies like Chevron, Shell and Consol are certified by the Center for Sustainable Shale Development are examples of continuous improvement and setting a higher bar.
-- Leasing Of DCNR Lands For Drilling: Sen. Yaw said only about 2 percent of DCNR lands are impacted directly by drilling on State Forest lands and quoted Quigley as saying previous that drilling payments and royalties was the “crack cocaine” for state government budgeting.
Quigley confirmed he did say that when he was DCNR Secretary because the Commonwealth was in the middle of a severe recession and DCNR did the first leasing of drilling rights to help fill the budget gap.
Quigley said he was ordered to do two follow-on leasing opportunities at the request of the General Assembly and Gov. Rendell, in spite of concerns expressed internally in DCNR about more leasing because the agency did not have experience with Marcellus Shale development.
Quigley said he was left no choice but to do the additional leasing, but directed that a monitoring program for the impacts of leasing be developed He also said DCNR undertook an analysis of any additional leasing opportunities which concluded the agency could not do any additional leasing with surface disturbance without endangering the sustainability certification of the State Forest. He noted the certification was very important to maximizing the economic development of timber on State Forest lands.
Quigley said the companies leasing State Forest lands are meeting high environmental standards in a good example of public-private partnership.
-- Protecting Coal: Sen. Yaw quoted Quigley as saying previously, “We must seize this opportunity to turn off coal and take advantage of alternative energy opportunities. Sen. Yaw asked how Quigley squares this comment with Gov. Wolf’s statement he wants to protect the role of Pennsylvania coal.
Quigley said that statement is several years old and he now has a boss and he agrees with Gov. Wolf’s approach to protecting coal, but also in taking a leadership position in dealing with issues like climate change regulations in a way that is Pennsylvania-centric.
Sen. Don White (R-Indiana) said he needs to know that Quigley will stand up for Pennsylvania coal like Gov. Wolf says he wants. He noted he has the coal industry, oil and gas industry and electric power industry in his district. He said he does not believe these industries need any more regulations.
-- Climate Change Regulations: Sen. Elder Vogel (R-Beaver) asked if Pennsylvania will get any credit for what Pennsylvania power plants have done to reduce emissions before 2012 as part of the EPA Clean Power Rule. Quigley said they are working with EPA on the issue and pointed out the Clean Power Rule is not yet been finalized. He said he is working to ensure there will be an opportunity to develop a Pennsylvania-centric plan for meeting those requirements, including protecting Pennsylvania coal.
He noted the General Assembly passed legislation last year giving the House and Senate the opportunity to review any plan before it is submitted to EPA.
-- Natural Gas Severance Tax: Sen. Yaw quoted Quigley from the House budget hearing related to the Governor’s severance tax proposal as saying the Marcellus Shale industry would not go anywhere, but to a state with a higher severance tax. Sen. Yaw noted a Senate hearing Monday heard testimony from the Independent Fiscal Office that Gov. Wolf’s severance tax would be the highest in the country.
Quigley said the Administration has differences with the IFO over how to calculate the effective tax rate. He repeated, the Marcellus industry is not going anywhere. Quigley said he wants to work with the Marcellus industry to maximize their economic development potential in Pennsylvania, but in a way that protects the environment.
Sen. Vogel (R-Beaver) said he hopes the severance tax proposal will not scare away economic opportunities like the Shell ethane plant in Beaver County. Quigley said Shell has said a severance tax will not have an impact on their final decision. Quigley noted DEP staff beat a deadline for having an air quality permit proposed for the ethane plant and did it correctly.
-- Chapter 78 Regulations: Sen. Yaw said his Committee has asked for DEP’s responses to the 24,000 comments originally made on Chapter 78 drilling regulations, but that request has been denied. He said the Committee cannot do its complete job in evaluating the rulemaking without those response. This denial, he said, does not square with the mantra of “transparency” the Wolf Administration.
Quigley said DEP started the public discussion of the Chapter 78 regulations in 2011, had 12 public meetings and 12 public hearings and have chosen to go beyond the minimum public participation requirements with the recent advance notice of public rulemaking.
He said he views the legal responsibility of the agency is to provide responses to comments on the differences from proposed to the final version of the regulation. “Simply,” said Quigley, “We are not done yet.”
Quigley acknowledge a Right-To-Know request from the Senator on the issue and said DEP will respond to that.
-- Oil & Gas Advisory Groups: Sen. Hutchinson (R-Venango) said DEP added members of the Oil and Gas Technical Advisory Board advising on the Marcellus Shale industry and created a related Oil and Gas Advisory Committee for conventional drilling without statutory authorization.
Quigley said in meeting with the conventional drilling industry, he thought they deserved their own advisory group and took action to form one. He noted Sen. Hutchinson sent DEP three letters recommending members to the Committee.
On the Technical Advisory Board for the Marcellus industry, he said that is still a work in progress, but Quigley said he believes it is better to come down on the side of having more participation, not less.
Sen. Hutchinson said the conventional drilling industry is telling him the new advisory group was created to provide “cover” to continue the development of regulations holding them to the same standards as Marcellus Shale drillers that will put them out of business.
Quigley said if DEP was not serious about hearing from the conventional well drillers, they would have not done it. He said the regulations covering conventional drillers have not been updated for decades and there continues to be environmental problems with conventional drilling. [See: Analysis: Myth- Conventional Oil and Gas Drilling Is Benign.]
Quigley said there are differences in how conventional well drillers are regulated in Chapter 78, including onsite disposal of wastewater and drill cuttings and other examples.
-- Abandoned Mine Reclamation: Sen. Yudichak (D-Luzerne) asked what DEP’s plans are to deal with the environmental impact of abandoned mine lands and old deep mines. Quigley said a reduction of resources to DEP and an aging workforce, particularly in Deep Mine Safety that is near retirement has been a problem in addressing these issues. Quigley said they are working with federal partners to attract as many resources as possible for reclamation and managing DEP’s existing resources carefully to address these issues.
-- Reuse Of Mine Drainage: Sen. Camera Bartolotta (R-Greene) said she will be introducing legislation to promote the reuse of mine drainage to replace fracking water used in Marcellus Shale drilling operations and asked if Quigley supported it. Quigley said conceptionally, he had no problem with it when it could be safely done.
-- Use Of Coal Refuse: Sen. Bartolotta (R-Greene) said the use and burning of coal refuse is an environmental advantage and should be promoted. Quigley said he looks forward to meeting with the coal refuse association in the coming weeks to go over their issues.
-- Comprehensive Energy Policy: Sen. Yudichak (D-Luzerne) asked Quigley to comment on the fact Pennsylvania has not had a comprehensive energy policy to deal with issues like natural gas developing, pipeline infrastructure, increasing manufacturing opportunities and striking a balance with regulating natural gas and coal industries.
Quigley said DEP meets with the Marcellus Shale industry quarterly to understand the issues they have and partner with them in developing the e-permitting program, for example. He said Chapter 78 is an effective response to concerns raised about drilling and is continuing to work with stakeholders on the final version.
Quigley said Gov. Wolf has proposed a comprehensive $225 million Energy Investment Program, including the last mile development to provide access to natural gas. [See: Summary of House Democratic Policy hearing Monday on the program.]
With respect to pipelines, Quigley said there are problems with getting natural gas to markets, “we get that,” he said. At the same time, the industry will be developing 25,000 miles or more of pipelines in the future to make these connections.
He said he intends to work with a new pipeline task force, like he did while at DCNR on wind energy, with the pipeline companies and other stakeholders having a conversation about how to work through the issues involved in developing and siting pipelines.
Quigley said he would like to get to the “sweetspot” of speeding up the pipeline planning and permit process, while reducing environmental and community impacts.
-- Smart Growth: Sen. Andrew Dinniman (D-Chester) asked for Quigley’s definition of “smart growth” to protect natural resources. Quigley said Chester County has a good model for protecting open space and attracting compatible development. He said he hopes natural gas pipelines can be developed in the same way through the pipeline task force. He noted it is not an easy process.
-- Differences Between Regions: Sen. Bartolotta (R-Greene) noted differences between the way DEP’s offices in the Southwest and Northeast handle pipeline permits and asked why. Quigley said there are differences in the volume of permits going through each of the offices. He noted DEP has lost 14 percent of its complement over the last six years, when the average state agencies lost 6 percent of its staff.
Quigley said under Gov. Corbett’s Permit Decision Guarantee Program DEP meets permit issuance deadlines 92 percent of the time, if the applications are submitted correctly.
Sen. Yaw said the Committee has not have an opportunity to discuss issues like the Chesapeake Bay Watershed and other concerns with federal regulation during the hearing, but made the motion to report Quigley’s nomination out of Committee without recommendation.
The full Senate has until June 9 to vote on Quigley's nomination.
The full Senate has until June 9 to vote on Quigley's nomination.
A video of the hearing is available on the Senate Environmental Resources and Energy Committee webpage.
Sen. Gene Yaw (R-Lycoming) serves as Majority Chair of the Senate Environmental Committee and Sen. John Yudichak (D-Luzerne) serves as Minority Chair.
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