by Wayne Lusvardi | October 2, 2013 12:12 pm
Editor’s note: Some corrections have been brought to our attention, and are appended at the end of the body of this article.
Will the national energy boom come to California? Natural gas unlocked from shale formations — “fracking” — has boosted economies across America. In just the past decade, North Dakota supplanted California as the country’s third-largest producer of oil and gas. Texas and Alaska remain the top two producers.
That could change. Last month, the Democratic state legislators pushed through Senate Bill 4 after it had been amended 10 times. Gov. Jerry Brown signed it into law. Although the bill contains some environmentalist provisions, generally it should promote fracking, which would lead to California jobs creation and higher tax revenues.
SB4 was sponsored by State Senator Fran Pavley, D-Agoura Hills, and her environmental voting block. Pavley previously served in the State Assembly and was chairperson of the Budget Committee on Resources. Her green voting record extends to both houses of the legislature.
Pavley voted for the much-amended SB4 despite opposition by a coalition of the Sierra Club, the Center for Biological Diversity, Physicians for Social Responsibility and a number of oil companies and business groups. The California League of Conservation Voters and the National Resources Defense Council pulled their support of the bill at the last moment. The reason environmental organizations withdrew their initial support was that the provisions in the bill calling for a moratorium and compliance with California’s tough environmental laws were removed and neutered.
The main reason that Democratic legislators unanimously voted for SB4 was the overwhelming support for the bill by city and county officials, the Los Angeles County Democratic Party Central Committee, and even U.S. Sen. Dianne Feinstein. Reports that the oil and gas industry had undermined the bill’s original intent did not stop Democrats from voting for it.
In order to appease the environmental constituency, environmentalists are reporting the passage of the bill in sugarcoated terms of what the bill will do. But it is what SB4 doesn’t do that is so important for California’s economy and future “wall of debt.” Even Democratic politicians sense that the potential revenues from fracking oil and gas in California are one of the few prospects for solving the state’s long-term debt problem, now estimated at $443 billion.
Nearly every Republican in the state legislature opposed SB4. SB4 does impose a lot of unnecessary bureaucratic rigmarole on oil and gas extractors. SB4 omitted any provisions for a fracking moratorium and relaxed compliance requirements with California’s tough environmental law, the California Environmental Quality Act.
Thus, SB4 could be viewed as a pro-fracking bill dressed up as an anti-fracking piece of legislation. If Republicans had voted for it, doing so would have created the impression that environmentalists should oppose it. This was one of those strange occasions where a Republican vote against the regulation of fracking was a vote against California’s overkill environmental laws and over-regulation of fracking.
1. No Moratorium. First and foremost, SB4 does not put a moratorium on fracking, as originally sought by environmentalists. The moratorium provision was strategically dropped at the last moment before the bill was put to a vote.
SB4 does not specifically stop the governor or state regulatory agencies from banning fracking either. But that seems a remote possibility at this point.
2. Fast Tracking Fracking. Fracking permits must also be provided under SB4 to nearby property owners within 30 days for an oil or gas extraction well head. While this provision sounds as if it is regulating fracking, it is actually putting fracking on a fast track. Neighbors to a fracking site can demand water testing. But in reality, a fracking well cannot be delayed for more than a month.
3. Relaxation of State Environmental Law. Most importantly, fracking can proceed without clearance by the California Environmental Quality Act. That’s right. Under SB4, the California Department of Oil, Gas and Geothermal Resources, can set “threshold levels” for chemical use in fracking projects. If a fracking operation stays within the threshold, then CEQA is not triggered.
4. Does Not Divulge Fracking Trade Secrets. SB4 requires fracking operators to apply for a permit from DOGGR. The permit process includes submitting a water management plan, a list of chemicals used, a groundwater monitoring plan and an estimate of how much solid waste (sludge) would be produced. But SB4 allows fracking operators to protect the precise formula of the ingredients they use to enhance the fracturing of subterranean rock formations to extract oil and gas.
Fracking operators have to publicly post the composition of the fluids used. DOGGR can review public demands for the release of such trade-secret fracking chemical formulas. But oil and gas companies can file a legal action to block DOGGR from releasing such information to the public. DOGGR won’t even have a specific website online for public disclosure of fracking until 2016 and must use its old website.
5. Mandates the Scientific Study of Fracking. Lastly, SB4 authorizes the State Department of Natural Resources to complete an independent, peer-reviewed scientific review of fracking technologies by January 1, 2015.
A recent EPA study indicates fracking operations do not leak significant amounts of methane into the environment. Other recent studies conducted in Texas and Canada have concluded that fracking does not contaminate groundwater supplies. This is self-obvious because the fracturing of rock formations to extract oil and gas occur miles below the water table.
Fracking is not purely a scientific issue but a cultural and political issue in California. Opposing fracking on scientific grounds does not appear promising from the prior assessments conducted by other states.
The oversight of fracking operations in California has been dispersed among a number of bureaucracies such as the State Water Resources Control Board, the Department of Toxic Substances Control, the Department of Resources Recycling and Recovery, and regional water quality control boards. So fracking permit fees will go to prop up the budgets of a number of state and regional agencies.
California Republican legislators will continue to be portrayed as obstructionists who oppose every budgetary allocation and regulation that comes down the pipe of the Democratic-controlled legislature. But the reality is quite different than the appearance.
Sometimes Democrats and Republicans are actually cooperating when they respectively support and oppose certain bills that are meant to symbolically appease a powerful special interest group. If Republicans had supported SB4, this would have created the appearance that Democrats should have opposed it.
Editor’s note: The following corrections and comments have been brought to our attention as of Oct. 5, 2013:
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