Energy Exchange

In President Obama’s State of the Union address last night, he laid out his plans for the expanded role that natural gas will play in the future. The President stated:

“We have a supply of natural gas that can last America nearly one hundred years, and my Administration will take every possible action to safely develop this energy. Experts believe this will support more than 600,000 jobs by the end of the decade. And I’m requiring all companies that drill for gas on public lands to disclose the chemicals they use.”

I am pleased to see a commitment to the full disclosure of hydraulic fracturing chemicals, but this is only the first step in getting the rules right for natural gas. As we discussed back in November, EDF President Fred Krupp sat on the Shale Gas Subcommittee of the Secretary of Energy Advisory Board (Subcommittee), which provided strong recommendations for strengthening environmental management in the shale gas industry and developing this abundant energy source in ways that safeguard public health and the environment. 

I would have liked to have seen the President speak directly to implementing the Subcommittee’s recommendations, beginning with the Department of the Interior (DOI). Simply committing to the disclosure of hydraulic fracturing chemicals isn’t enough. The recommendations included strict requirements for everything from well construction and the reduction or elimination of methane venting to groundwater protection to methane leakage and emissions flares, among others.  These recommendations are ready to be implemented, and DOI has an opportunity to demonstrate best practice in its leasing and oversight of unconventional natural gas development on federal lands.

The jury is out on whether states will embrace the Subcommittee’s recommendations and it will take a concerted effort on the part of organizations like EDF and concerned citizens to demand swift action to improve the quality and effectiveness of state regulations.  Implementation of the Subcommittee’s recommendations at the state level is a good place to start and some states are beginning to take a lead role.  For example, on the issue of disclosure, Colorado recently set the bar for requiring the full disclosure of all chemicals used in hydraulic fracturing by making this information available on a searchable database. On the other hand, states like New York have proposed weaker requirements, asking companies to disclose only half of the proposed additive products instead of the chemicals actually used in the hydraulic fracturing treatment. For these reasons, it is crucial that the DOI disclosure requirements set a leading example that will influence states to do better.  The DOI should start with Colorado, but can do even better.

Last night, the President demonstrated his commitment to domestic energy production through natural gas development and said that “America will develop this resource without putting the health and safety of our citizens at risk.” The federal government and the states have a shared responsibility to ensure that our air, land and water are safe wherever hydraulically fractured wells are drilled.

Today the Department of Energy’s Shale Gas Production Subcommittee released a final report that follows up on its earlier recommendations for increased oversight and transparency, assesses their implementation to date and lays out a roadmap for improvement.  The report proposes a focused set of steps for strengthening environmental management in the shale gas industry and developing this abundant energy source in ways that safeguard public health and the environment.  

The report is a call to action, stating “Americans deserve assurance that the full economic, environmental and energy security benefits of shale gas development will be realized without sacrificing public health, environmental protection and safety” and the Subcommittee believes that these recommendations, if implemented, would make real progress toward meeting these goals.  Time is of the essence, though, as the ramifications of inaction pose more risk every day.  

While much more remains to be done to ensure shale gas development is safe for people and the environment,  important progress is currently underway on federal, state and local levels.  The EPA, for example, has proposed rules to reduce air pollution from oil and gas development activities that, while needing improvement, are a critical first step.  Likewise, we’ve seen that states can move very quickly to update their oil and gas rules when they have a mind to.  For example, in only the past eleven months Arkansas, Texas, Montana and Louisiana have adopted requirements mandating the disclosure of chemicals found in hydraulic fracturing fluid.  And Colorado, New York, New Mexico and North Dakota have recently proposed requirements relating to fracturing fluid chemical disclosure.  In Pennsylvania, West Virginia and Ohio, legislatures have passed, or are in the process of debating, more stringent regulations on the exploration and production of natural gas.  

EDF is actively engaged across the country to further the safety and environmental protection of our natural resources wherever the production of natural gas is occurring.  It’s a long, cross-country road trip on highways still under construction.  We’re prepared for the long haul.

Natural gas plays an important role in our nation’s economy, and has the potential to help reduce greenhouse gas pollution, bolster energy security, and reinvigorate domestic manufacturing.  Unfortunately, these potential benefits are jeopardized by inconsistent and often poor natural gas production practices, leading to real threats to public health and the environment, that understandably engender community opposition to natural gas production. 

To say the natural gas industry has a credibility problem is an understatement.  If the recent spate of critical articles in the New York Times escaped your attention, than perhaps you saw this recent bit on the Colbert Report, which demonstrates, among other things, that the general public has little understanding for the complex issues surrounding shale gas development, and the industry has been doing little to engage them in a serious way.  The Colbert bit is funny, but the need to get the shale gas issue right is no joke.

In March, President Obama directed Energy Secretary Steven Chu to appoint a group of energy and environmental experts to study the issue.  EDF President (and my boss) Fred Krupp was appointed to the panel.  During 90 days of intensive investigation and deliberation, the panel, chaired by MIT professor John Deutch, held a series of public hearings. They heard from industry officials, environmental leaders, federal and state regulators, scientists and others.  They visited well sites to see drilling and production first hand.   They held a public meeting in southern Pennsylvania to hear directly from people who are living with intensive shale gas development – both the good and the bad.  Supporters and opponents packed the auditorium and told stories about how the shale gas boom had affected them. For some, it had provided an economic lifeline. For others, it had made life a nightmare. 

And today, after much study and deliberation, the committee has issued a report with some very specific recommendations which, if implemented, could materially reduce the risks to public health and environment from shale gas development and begin to build public trust. 

The report calls for increased oversight: robust enforcement practices and modernized rules to safeguard communities and improve communication between state and federal regulators. The report makes it clear that “effective and capable regulation is essential to protect the public interest. The challenges of protecting human health and the environment in light of the anticipated rapid expansion of shale gas production require the joint efforts of federal and state regulators. This means that resources dedicated to oversight of the industry must be sufficient to do the job and there is adequate regulatory staff at the state and federal level with the technical expertise to issue, inspect and enforce regulations.”

The report also makes clear that regulation alone will not be enough.  It calls for the full public disclosure of all chemicals used in the process of hydraulic fracturing.  It calls for gathering the data necessary to determine whether, and to what degree natural gas provides greenhouse gas benefits when substituted for coal or oil in energy production or transportation.  It recommends that the industry get its own house in order by organizing itself to identify and share best practices across the industry with a relentless focus on continuous improvement in reducing air and water pollution and other environmental harms. 

These recommendations won’t solve all problems, and there is much work to be done simply to make these recommendations a reality, but today’s report is an important step in getting beyond the comedy bits and headlines to focus on those measures that can make a material difference in improving public health and the environment.