With the battle lines drawn and the sides already chosen, Republican presidential nominee Mitt Romney is set to get the fossil fuel vote. But would there be a marked shift in how he would use the regulatory levers and if so, what would that be?
A major question is over how shale gas is extracted. Estimates are that there a century’s worth of those reserves here. Indeed, both President Obama and Governor Romney understand the potential but they are diverging over how the drilling process would be monitored. The current White House says that such unconventional natural gas is such a game-changer and that it requires more federal oversight while a Romney presidency would continue to let the states supervise the development of gas drilling.
“While fracking requires regulation just like any other energy-extraction practice, the EPA in a Romney administration will not pursue overly aggressive interventions designed to discourage fracking altogether,” says Romney’s position paper. “States have carefully and effectively regulated the process for decades, and the recent industry agreement to disclose the composition of chemicals used in the fracking process is another welcome step in the right direction.”
That position is supported strongly by the natural gas industry, which says that such regulations should remain at the state level. It adds that the country’s geography varies from region-to-region and that a one-size-fits-all approach is not just impractical but also duplicative and expensive.
Hydraulic fracturing, or fracking, is the process by which gas producers ply loose the shale gas that is embedded in rocks and is located a mile beneath the earth’s surface. Developers use a concoction of sand, chemicals and water to achieve those aims — something that drillers say is safe and proven. However, that is something that some civic and environmental groups say is damaging drinking water supplies and allowing polluted water to resurface.
Herein is the divide between how the two administrations would react: The president’s position is that shale gas can never reach its potential unless the natural gas companies and the developers have the full faith and trust of the communities where they are doing business. As such, Obama says that the Environmental Protection Agency has the authority to monitor certain aspects of shale gas production such as the disposal of waste water and the assurance of clean water supplies.
EPA, for example, would require developers to disclose the chemicals that they use to “frack.” The agency says that harmful elements such as metals, salts and radionuclides could infiltrate unless the drilling methods is fool-proof.
The regulatory agency is also advancing “green completions” whereby producers would install the necessary technologies to capture such releases as methane that can be re-sold. Fracking fluids must also be re-injected or re-cycled, which some states already mandate. The wastewater injection method, however, is being blamed in some circles for tremors that have occurred in Ohio. While the matter is being investigated, it has caused some states to delay those practices until they can be fully understood.
Undoubtedly, shale gas has the potential to transform the national energy picture. Consider: Production from shale formations has grown from a negligible amount just a few years ago to almost 15 percent of total U.S. natural gas production and this share is expected to triple in the coming decades. By 2035, natural gas, generally, will make up about 45 percent of the utility generation market, says the Energy Information Administration.
“So the role the federal government at this point is to make sure that we are providing the research dollars and the monitoring so that we don’t see the health and safety of people in these areas put at risk, but the technology has improved greatly and the natural gas boom that we’re seeing around the country is something that I want to encourage,” Obama told WHBC Radio in Ohio, in a phone interview that its host had conducted.
Several environmental groups are bucking the president, maintaining that unless fracking is certifiably safe, it should be indefinitely postponed. By extension, the natural gas industry is feeling the heat. While it has said that revealing proprietary data would hurt its competitive position, producers are coming around. Chesapeake Energy, for example, says that the disclosure of fracking chemicals is the only way to move forward. Already, about 10 states have such rules on their books.
A high profile advisory board to the U.S. Department of Energy reported last year that shale gas development can live up to its expectations, both economically and environmentally. It said that greater openness would give regulators more accurate and complete information. The public, meantime, would be assured of continuous and measured improvement in the drilling methods being used.
Both Obama and Romney understand that shale gas is positioned to provide abundant energy, and potentially a huge number of jobs. But if the fuel is to fulfill those possibilities, producers must work closely and openly with state and federal regulators as well as their communities. Solutions do not reside with the highest political donors but rather through stakeholder involvement to address all real concerns.