Republican Senators Doug Mastriano (R-Adams) [also a candidate for Governor] and Scott Hutchinson (R-Venango) announced Friday they plan to introduce legislation to “stabilize energy costs” for Pennsylvanians and do away with “cumbersome taxes, regulations and restrictions” handicapping the state’s energy sector.

“The people of our Commonwealth should not be subject to fluctuating energy and fuel costs. We can take steps now to assert future energy independence.”

“With our abundant resources, Pennsylvania should be largely immune to energy cost volatility.”

At the same time, they said-- “Market volatility will not go away anytime soon. There will always be more supply chain descriptions, fluctuations, and international conflicts in the future.”

To accomplish their goal, the Senators propose--

-- Natural Gas and Drilling

     -- “Immediate suspension of the Corporate Net Income Tax and Personal Income Tax for natural gas producers”  [Note: This is just a straight giveaway to the industry for no required benefit to the public.]

     -- “Reduce DEP’s gas permit fees to pre-2020 levels (200% cut from current fees)” 

        [Note: Shale Gas companies already don’t use 40 percent of the drilling permits they are issued by DEP, so it’s likely fees aren’t the problem. Read more here. Right now DEP has a $10.5 million deficit in permit fee revenue that supports the Oil and Gas regulatory program, which is nearly half of the $25 million it costs to run the program.  Read more here.  In addition, conventional oil and gas drillers only contribute $46,100 of the $10.6 million it costs to regulate that industry.  Read more here.]

     -- “End the moratorium on new leases on state lands by directing DCNR to initiate an approval process for new leasing opportunities.”

        [Note: DCNR said at its budget hearing March 2 shale gas drillers haven’t developed 65 percent of the State Forest land they already have leases to drill on, so opening more land they might not drill on doesn’t seem to be the right solution.  Read more here.]

-- Coal-Powered Plants

     [Note: Pennsylvania only has three remaining coal-fired power plants that haven’t announced plans to close due to competition from natural gas and now renewables.  More than 19 other coal plants are already closed for the same reason. Read more here.]

     -- “Exempt Pennsylvania from plant-closing EPA regulations such as the Wastewater Rule and the Cross State Air Pollution Rule.”

        [Note: That’s not the way it works. A state cannot exempt itself from a federal law or regulation. It still applies whether EPA enforces it or the state does through its federally-approved pollution control programs.  The issue of whether a state can secede from the Union unilaterally was settled at Appomattox.]

     -- “Intrastate Coal/Natural Gas Use Provision: establish a provision to clearly state that any environmental regulation of coal and natural gas that is extracted and used in Pennsylvania can only be exclusively regulated by the Commonwealth, not by the Federal government.”

        [Note: That’s not the way it works. A state cannot exempt itself from a federal law or regulation. It still applies whether EPA enforces it or the state does through its federally-approved pollution control programs. The issue of whether a state can secede from the Union unilaterally was settled at Appomattox.]

-- Regulations and Permits

     -- “Require a report from DEP to the General Assembly on all current rules and regulations affecting the natural gas and coal industries and the respective economic impact.”

        [Note: Will the Senate and House offer to pay for this report out of their $233 million operating surplus just sitting in their bank accounts?]

     -- “Require legislative approval for any new regulations affecting the natural gas and coal industries.”

        [Note: House and Senate Republicans have wanted to do this for years.  They even moved legislation to kill regulations by doing nothing.  Read more here.]

     -- “Improve transparency in the permit review process and expedite approvals.

         [Note: At DEP’s budget hearing February 28, the agency announced it would be unveiling a new tool to track permits through the review process.  Read more here.  On expediting permit approvals, Senate Republicans have moved legislation creating yet another bureaucracy to allow private review of permits without such basic provisions as conflict of interest standards which would prevent private consultants from reviewing their own applications.  Read more here.]

-- Regional Greenhouse Gas Initiative

     -- “Immediate suspension of Pennsylvania’s entry into RGGI”

        [Note: Republicans have opposed establishing a program to cut carbon pollution from power plants consistent with the Regional Greenhouse Gas Initiative since it was first suggested. Eliminating this regulation would not address the issue of “fluctuating energy and fuel costs” nor would it somehow increase available supplies of energy.]

This description of the Senators’ suggestions is from the memo they sent to their colleagues asking them to co-sponsor their legislation.  It isn’t the actual legislative language.

But even from this description anyone would be hard-pressed to understand how any of these suggestions would stabilize “fluctuating energy and fuel costs” in the state.

First, Pennsylvania produces only a relatively small amount of crude oil and most of that is refined into lubricating oil, not gasoline or other fuels, as anyone familiar with the oil industry in the Commonwealth would know.

Shale oil executives themselves-- which don’t operate in Pennsylvania-- have said supply chain issues, labor shortages, wary investors, sand supplies and equipment shortages are hampering production-- as well as previously low crude oil prices.  Read more here.

Shale oil executives have also said-- “The [energy] markets] turbulence has just begun.”  Read more here.

Global market forces, not our abundance of domestic fossil fuels, set the price of oil, gasoline and natural gas in the United States and the world.  Read more here. 

Just because you have an abundant supply of something, doesn’t mean you control demand or the price. Read more here.

A good illustration of that is the oil price collapse in 2020 due to COVID when the price of crude oil dropped below zero for a time.  [Note: BTW, the price at the pump didn’t go to zero.]

The reason natural gas producers in Pennsylvania have kept thousands of their shale gas wells shut in, haven’t used 40 percent of the DEP permits they got and haven’t drilled on state land they have already leased-- is because the demand for their product and the price of natural gas wasn’t high enough.

The oil and gas industry now wants to use the invasion of the Ukraine as an opportunity to increase market share, sell their product at whatever premium price they can get and build out an oversized infrastructure because they know the cost of clean, renewable energy is going down and it’s cost is more predictable.  Read more here.

The real question is-- why would we want to lash ourselves even tighter to volatile foreign energy markets when there is no limit on what they can charge us for oil and natural gas?  Read more here.

The proposals in this co-sponsor memo are a good example of political “dog whistles.”

Related Articles:

-- Guest Essay: Our Addiction To Fossil Fuels Fuel War: ‘Only Truly Addicted People Chase After Their Next Hit With Singular Focus As The Consequences Of Their Addiction Pile Up Around Them’ - By Rev. Mitchell C. Hescox, Evangelical Environmental Network

-- 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  

-- Oil & Gas Industry And Their Politicians Are Pushing Hard To Hook Us To Volatile Foreign Energy Markets Where There Is No Limit On What They Can Charge You

-- New European Commission REPowerEU Plan Does Not Justify Dramatic Increase In Drilling, Gas Infrastructure Build Out PA Natural Gas Politicians Are Calling For

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

-- Conventional Oil & Gas Drillers Pay Only $46,100 Of The $10,600,000 It Costs DEP To Regulate That Industry; Taxpayers May Be Asked To Pay The Difference

-- Republican Senators Propose Gas Drilling On At Least 22,000 More Acres Of State Forest, Mining 920 Acres Of Coal Under A State Park To Pay For DCNR Infrastructure Backlog 

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

[Posted: March 12, 2022]

3/14/2022