Thursday, March 24, 2022

Republican House Bill Contains Natural Gas Industry Wish List Of Measures To Expand Natural Gas Drilling, Subsidize Pipeline Expansion, Automatically Approve Well Permits, Preempt Local Governments

On March 23, Rep. Seth Grove (R-York) introduced
House Bill 2444 that contains a natural gas industry wish list of measures they want to expand natural gas drilling, subsidize pipeline expansion using DCNR Oil and Gas Fund revenue, automatically approve of well permits and preempting local government regulation of all facilities regulated by DEP.

This legislation is one of several Republican Senate and House initiatives to deregulate the oil and gas industry, power plants and make other sweeping changes under the guise of responding to the oil and gas price spikes caused on world energy markets by the Russian invasion of the Ukraine.

Two Republican Senators last week announced plans to introduce sweeping legislation to do away with “cumbersome taxes, regulations and restrictions” handicapping the state’s energy sector.”  Read more here.

In reality, these are initiatives Republicans wanted to give away to the oil and gas industry for years.

Major Provisions

The major provisions of House Bill 2444 include--

-- Opening All State Park & Forest Lands To Drilling: The bill establishes a program that allows companies to nominate any State Park and Forest land for natural gas and oil development from subsurface drilling originating outside the State Park or Forest property.

Proposals by companies for drilling under State Park and Forest land are automatically approved on the fourth resubmission to DCNR.

This provision is based on the myth that natural gas and oil companies cannot now drill on DCNR State Forest lands.  DCNR has not authorized any unconventional natural gas drilling under State Park lands.

Fact: DCNR testified at the Senate’s March 4 budget hearing, 65 percent of the prime natural gas leases on State Forest land in 2008-2013 have not been developed.  Read more here.

DCNR said they could start drilling on those lands anytime they want, but haven’t.  Read more here.

-- Subsidizing Pipeline Development With DCNR Funds: Establishes a Natural Gas Pipeline Development Program administered by the Commonwealth Financing Authority to provide grants to expand natural gas use for a wide range of purposes-- commercial and in-house use as well as giving “priority to applications that result in maximizing the delivery of nature gas from this Commonwealth to domestic markets.”

This program would be funded by transferring $50 million annually from DCNR’s Oil and Gas Lease Fund.

The program would clearly provide taxpayer funding to support pipelines like Energy Transfer/Sunoco’s Mariner East Pipeline that resulted in record penalties from DEP and the PUC and Energy Transfer’s Revolution Pipeline that exploded in Beaver County in 2018 right after it entered service and also penalized record amounts.  Read more here.

Fact: This provision of the legislation is clearly unconstitutional because the PA Supreme Court has ruled twice that transfers from DCNR’s Oil and Gas Lease Fund to support General Fund purposes is unconstitutional.  Read more here.

-- Automatic Approval Of DEP Permit Applications: Requires automatic approval of any DEP permit application related to unconventional oil and gas development if a decision is not made within deadlines established in the legislation.

This provision is based on the myth that the unconventional oil and gas industry does not already have enough approved permit applications to expand production.

Fact: The unconventional drilling industry has not used 40 percent of the permits DEP issued to these companies. The industry received 22,632 well permits, but only actually drilled 13,395-- a gap of 9,237 wells never drilled by industry.   Read more here.

Fact: The Independent Fiscal Office reported in its fourth quarter natural gas production report that only 10,322 horizontal wells-- of the 13,395 wells drilled-- were actually producing gas, and even then production was up 6.8 percent in 2021. Read more here.

The unconventional gas industry can expand production dramatically today without drilling another well in the near future, if they wanted to.

-- Preempting Local Governments From Setting Environmental Standards For Any Activity Regulated By DEP:  This extremely broad preemption provision covers not just oil and gas drilling activities, but any activity regulated by DEP.

Fact: The PA Supreme Court issued a decision in 2013 declaring a similar provision in the Act 13 state law regulating oil and gas drilling unconstitutional.  Read more here.

The Court’s decision upheld the ability of local governments to protect their local communities and natural resources through their traditional tools of land use controls and zoning ordinances.

The decision was based on the responsibilities all levels of government have under the Environmental Rights Amendment to the state constitution as a trustee for Pennsylvania’s environment.  Read more here.

-- Takes Away DEP’s Authority To Regulate Carbon Pollution: The bill takes away DEP’s existing statutory authority to reduce carbon pollution from power plants and other sources.  It  kills the Environmental Quality Board’s final regulation reducing carbon pollution from power plants consistent with the Regional Greenhouse Gas Initiative.

This provision has nothing to do with increasing natural gas or oil production in the Commonwealth.

The bill copies the provisions of Senate Bill 119 (Pittman-R- Indiana) and House Bill 637 (Struzzi-R-Indiana), which are both in the House.  [Note: Senate Bill 119 is scheduled to be considered by the House Environmental Committee on March 28.  Read more here.]

House and Senate Republicans have been opposed to the regulations since Gov. Wolf announced the initiative in 2019.  Read more here.

The regulations are based on federal law and regulations that classify carbon dioxide as a pollutant that is required to be regulated under the federal Clean Air Act and by states with primacy for regulating air pollution like Pennsylvania.

Related Articles:

-- Republican Rep. Fritz Introduces Bills To Unilaterally Amend Delaware River Basin Commission Compact To End Fracking Moratorium

-- 2 Republican Senators Lay Out Agenda For Deregulating Oil & Gas Industry, Power Plants In PA

-- House Environmental Committee Sets March 28 Meeting To Vote On Bills Killing RGGI Regulations, Promote Natural Gas Pipelines Into NY, NJ 

-- PA Natural Gas Politicians Want To ‘Unleash’ PA’s Gas Industry - What We Need First Is For Industry To Divert LNG To Europe; Take Up The Slack; Oil & Gas 2.0; True Energy Independence 

-- DEP Budget Hearing: Unconventional Natural Gas Industry Didn’t Drill 40% Of The Wells It Had DEP Permits For 

-- Senate Budget Hearings: PA’s Experience With New Pipeline Construction Shows State Laws Not Strong Enough To Prevent Environmental Damage, Protect Public Safety 

-- PA Supreme Court Again Declares Transfers From DCNR Oil & Gas Fund Unconstitutional Under Environmental Rights Amendment

-- PA Supreme Court Rules Act 13 Drilling Law Municipal Preemption Unconstitutional

[Posted: March 24, 2022]  PA Environment Digest

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