Over the years MDN has heard the oft-repeated comment that if New York and other states want to block new pipelines, maybe Pennsylvania should quit shipping its gas to those states. PA State Senator Gene Yaw has also heard those comments and, in a brilliant move, Yaw will soon introduce a bill that does precisely that: block natural gas shipments to states like New York, New Jersey and Maryland–states attempting to (or have) blocked new pipelines from PA.
Yaw talked about his plan in a speech at yesterday’s UpStreamPA Natural Gas Conference in State College. Yaw said, “In keeping with the wishes of those states to impede marketing, I intend to introduce a measure, which would prohibit the transportation and sale of any Pennsylvania natural gas that is produced by fracking to those states.” Brilliant!
Of course it will never fly from a legal standpoint, but then, that’s not the purpose. We doubt PA drillers would cotton to the idea of a sales ban if by some miracle Yaw’s bill passes and gets adopted into law. Although NY, NJ and MD are blocking new pipelines, there are existing pipelines that carry a great deal of PA’s gas into those states right now. Cutting off NY, NJ and MD would quite literally bring them to their knees in a hurry.
The point Yaw is trying to make is that if those states continue to block new pipeline infrastructure for purely political reasons (which is the ONLY reason they have to block them), two can play at that game. And PA has a much bigger card to play–an economically crippling card.
So in the end Yaw’s bill is about making a statement. And we applaud Yaw for having the guts to do so.
Here’s how it went at yesterday’s event:
On April 17, Sen. Gene Yaw (R-Lycoming), Majority Chair of the Senate Environmental Resources and Energy Committee, announced in a speech at the UpStreamPA Natural Gas Conference in State College he plans to introduce legislation to ban the sale or transport of Pennsylvania natural gas to states that impede the development of natural gas pipelines.
Sen. Yaw said those states include New York, New Jersey and Maryland.
“As lawmakers, we have an obligation to be aware of the competing interests that involve our state and the nation. If only our state neighbors understood this principle,” Sen. Yaw said. “New York, New Jersey and Maryland have worked to limit the expansion of pipelines, which curtails our ability to market Pennsylvania produced natural gas.
“In keeping with the wishes of those states to impede marketing, I intend to introduce a measure, which would prohibit the transportation and sale of any Pennsylvania natural gas that is produced by fracking to those states,” said Sen. Yaw.
Under Gov. Mario Cuomo, New York State has banned high-volume hydraulic fracturing, and its environmental regulators have blocked a major natural gas pipeline originating in northeastern Pennsylvania, which would provide much needed natural gas to the New England states.
The result has forced those states to import LNG [liquid natural gas] from Russia.
“The actions of the New York Governor have, in essence, stalled infrastructure development that is vital to creating new markets for natural gas and its related liquids, not only in Pennsylvania but across the northeast and world,” Sen. Yaw said. “Further, the delay in infrastructure development is contributing to the large price disparity that is putting Pennsylvania gas producers at a disadvantage, while aiding our global natural gas competitors.”
During the forum, Sen. Yaw noted several issues presently being discussed in Harrisburg including a severance tax on natural gas development, legislation adding nuclear energy to the state’s Alternative Energy Portfolio Standards (AEPS), environmental permitting issues, and the transportation of fracked gas to surrounding states.
Since 2012, the natural gas “Impact Fee” has generated nearly $1.7 billion in new revenue, noted Sen. Yaw.
“Of the roughly 60 percent of the nearly $2 billion impact fee money that goes to local counties and municipalities, more than $250 million has been directed to my Senate district,” Sen. Yaw said. “If a severance tax is imposed on the industry, the impact fee must remain intact.” I do not know of any time when this much money was sent back to our local governments without a long, involved grant process.”
The annual event brought together over 100 key upstream companies and experts in the oil and gas field. The conference provides attendees with the opportunity to learn about upstream development expected for the Appalachian Basin over the next several years.*
Side note #1: If Yaw was quoted accurately above, he misspoke. It is Andrew Cuomo, not his now-deceased father Mario Cuomo, who banned fracking and is blocking pipelines. Easy mistake to make.
Side note #2: We have a disagreement with Sen. Yaw on the severance tax. There is no “if” a severance tax is imposed. It’s an either/or. Either you have a severance tax and no impact tax, or you have an impact tax and no severance tax. You cannot double-tax the industry, making PA taxes on the shale industry the highest in the country, and expect drillers to stick around. We hope Yaw understands that key difference and doesn’t vote, again, for a severance tax as he did in 2017 (see PA Sen. Gene Yaw Defends Vote for Severance Tax).
Aside from our disagreement with Yaw on a severance tax, we want to once again applaud his effort to verbally slap NY, NJ and MD right across the face and get their attention with respect to blocking pipelines. Brilliant move!
*PA Environment Digest Blog (Apr 17, 2019) – Sen. Yaw To Introduce Bill To Ban Sale Of PA Natural Gas To States That Impede Pipeline Development
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