Government Accountability Office Report Debunks Industry Criticism of New Federal Fracking Rules

Government Accountability Office Report Debunks Industry Criticism of New Federal Fracking Rules

10/23/2012

 As of Oct. 15, oil and gas operators must notify the U.S. Environmental Protection Agency (EPA) via e-mail two days in advance of extracting natural gas from a hydraulically fractured or refractured well. This notification requirement is part of EPA’s new Clean Air Act (CAA) standards, which will reduce emissions from volatile organic compounds (VOCs) released during natural gas production by requiring “green completions” after January 2015. Industry opposes the standards, but a new report shows they are crucial to protecting the public.

The oil and gas industry appears to be ramping up its lobbying efforts to dismantle the new rule, beginning with criticism of the advance notice requirement that went into effect last week. In particular, drillers are upset that they must send the advance notice to EPA, preferring state regulation of hydraulic fracturing.

However, a new Government Accountability Office (GAO) report explains that states lack the resources necessary to effectively protect the public from environmental pollutants and safety concerns associated with fracking. Given the rapid pace of natural gas development, states need EPA’s help with collecting information needed to conduct inspection and enforcement activities. That is why EPA’s advance notice requirement is an important first step.

Background on Hydraulic Fracturing Regulation

Hydraulic fracturing, commonly referred to as fracking, is a process used by drillers to stimulate the flow of oil and natural gas from tight rock formations thousands of feet beneath the earth’s surface. Fracking occurs by injecting a fluid mixture of sand and chemicals, called “proppant,” into a well at high pressure to cause fissures in the rock formation and force the natural gas to the surface.

The fracking process produces more greenhouse gas emissions over time than traditional methods of oil drilling or coal mining, due to tanker trucks hauling in millions of gallons of water to pump into the wells. Significant emissions, like methane and propane, are also released from the wells themselves. Fracking also poses health risks to workers at wells who may breathe in vapors from fracking operations or from flowback wastes stored in pits or tanks.

The Clean Air Act is the primary federal law responsible for protecting air quality in the United States. Under the act, EPA sets air quality standards, but states typically implement these standards in accordance with a state implementation plan (SIP) approved by EPA. Until recently, the emissions from oil and gas wells remained largely unregulated by federal law, and only some states had regulations that applied to hydraulically fractured wells.

In 2009, several environmental groups filed suit against EPA for failing to review and revise its Clean Air Act rules related to the oil and natural gas sector. In response, EPA issued New Source Performance Standards and National Emissions Standards for Hazardous Air Pollutants in April 2012.

The primary purpose of these new standards is to reduce emissions by requiring operators to capture emissions released into the atmosphere as the fracking fluid pumped into the well flows back out into a surface containment area. Without this requirement, emissions are released into the atmosphere and contribute to the greenhouse effect. The new standards also require drillers to notify their regional EPA office by e-mail at least two days prior to extracting natural gas from a hydraulically fractured or refractured well. The notice must include the name of the owner or operator of the well and the geographical coordinates of the well site.

Industry Criticism of New EPA Rule Debunked

On Oct. 9, E&E reporter Mike Soraghan published an article about drillers’ opposition to EPA’s new air emissions standards. Many drillers would prefer to notify state regulatory agencies instead of EPA. Soraghan quoted the Vice President of Louisiana Oil and Gas Association, Gifford Briggs, who said, “This is as close as [EPA’s] ever gotten to regulating hydraulic fracturing.” Briggs also questioned the purpose of sending the notice to EPA directly, asking, “Why does EPA need to be involved when it’s regulated by the state already?”

A GAO report on unconventional oil and gas development published last month explains why it is imperative for EPA to get involved with oil and gas regulations. The report reviewed eight federal environmental laws and six states’ oil and gas regulations and identified agencies’ largest challenges in overseeing unconventional oil and gas activities (i.e., fracking). EPA’s biggest challenges are its lack of clear legal authority and the limited information it has about well-site locations, practices taking place at the sites, and equipment being used for drilling. States report that their biggest challenge is not having enough staff to perform inspection and enforcement activities. Another challenge for states is the lack of resources and staff needed to promptly respond to information requests and provide educational materials to local communities because of the overwhelming public interest in fracking.

The challenges GAO identified mirror concerns addressed by an OMB Watch report released in July and a recent study by Earthworks. (For a synopsis of the Earthworks report, click here to visit our blog, The Fine Print.)

The gas industry fears EPA notification will be the first step toward stronger federal regulation of fracking hazards, something the industry has been lobbying against for years. For instance, the Energy Policy Act of 2005 exempts fracking from EPA rules under the Safe Drinking Water Act. This was a victory oil and gas lobbyists worked hard to secure.

Industry often prefers state regulation and enforcement of health and environmental rules because they are often more lax and less comprehensive than federal oversight. Of six states reviewed by the GAO report, for example, just five had notification, reporting, or monitoring rules pertaining to hydraulic fracturing, and these regulations varied significantly.

States need help protecting the public, workers, and wildlife habitats near well sites from the dangers of hydraulic fracturing, especially the contaminants released into the air. With few resources and less expertise, states need EPA’s support.

Conclusion

The new notification rules established by EPA provide the agency with a new opportunity to track fracking well locations and compile information about the operators responsible for complying with health and environmental standards. However, where state oil and gas rules also include an advance notification requirement, EPA’s new rules permit the well owner or operator to notify the state agency only and do not require any notification to be sent to EPA. Thus, the new advance notice requirement is an important first step away from the existing patchwork of state regulations and toward a set of comprehensive, uniform federal protections.

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