Editor’s Note: This is the second of a two-part series on hydrofracturing, or “fracking,” the controversial process of extracting natural gas and oil. Pipeline giant Kinder Morgan has proposed constructing a $5 billion 36-inch, high-pressure pipeline from the Marcellus Shale in Pennsylvania through New York and Massachusetts to transport fracked natural gas to eastern New England. Sixty-eight percent of the natural gas is available for export. The pipeline network has become the subject of intense protests from environmentalists who warn that not only does the pipeline itself represent an environmental risk but that it perpetuates the nation’s reliance upon fossil fuels. To read Part I of our series, click here.
Federal regulations – A plethora of exemptions
If fracking were to be transformed into a safer and cleaner industry, at a bare minimum, numerous loopholes in existing federal regulations would need to be closed. Right now, EPA has scant authority to oversee fracking operations.
The Safe Drinking Water Act. Enacted by Congress in 1974, the law is intended to ensure that all public drinking water is safe, whether from surface or groundwater sources. However, the Energy Policy Act of 2005 specifically exempts oil and gas hydrofracking from the Act under the provisions of the Halliburton Amendment, so-named because Dick Cheney, former CEO of Halliburton, and, in 2005, Chairman of the National Energy Policy Development Group, advocated the amendment. Under its terms, EPA is barred from regulating any activities associated with well construction, fluids injected undergound into the drilling well, and other activities at the wellpad. EPA does, however, retain authority under this Act to administer the Underground Injection Control (UIC) program, which governs disposal of fracking wastewater. Over the years, however, most states have been granted authority by EPA to run their own UIC programs.
The Resource Conservation and Recovery Act. (RCRA). This Act gives EPA authority to regulate the transportation, storage, and disposal of hazardous waste generated by industrial facilities. However, waste from oil and gas production, such as drilling fluids and wastewater, are categorized as “special wastes” rather than hazardous wastes, and are subject to less protective requirements. For example, while hazardous wastes must be stored in pits or surface impoundments that have impermeable liners to prevent migration of the waste, there is no liner requirement for oil and gas wastes.
Superfund. Enacted in 1979 for the purpose of funding and remediating abandoned hazardous waste, the Superfund statute excludes waste from petroleum and natural gas — even if it contains hazardous chemical compounds. Companies arguably have little incentive to prevent or clean up spills.
The Clean Water Act (CWA). The CWA, designed by Congress to protect the country’s streams, rivers, creeks and wetlands, exempts oil and gas drilling and production facilities from the requirement to obtain permits for storm water runoff. The Energy Policy Act of 2005 added a provision that exempts oil and gas construction activities from storm water runoff permitting requirements in addition to “ oil and gas exploration, production, process or treatment operations.”
The National Environmental Policy Act (NEPA). Whenever there is a “major federal action,” such as interstate pipeline construction, mining projects impacting federal lands, or activities that would affect floodways or wetlands, the impacts of the project must be comprehensively analyzed in an Environmental Impact Statement, (EIS). Under the Energy Policy Act of 2005, however, oil and gas drilling activities that may impact public lands or involve some sort of federal participation are exempt from the EIS requirement.
The Clean Air Act (CAA) The CAA has reduced emissions of hazardous pollutants as well as ozone, particulates and others. Hazardous emissions are subject to strict controls under the Act if they exceed a pounds-per-year limit. When pollutants are emitted from different sources, or parts of an industrial process, their emissions are generally aggregated for purposes of figuring the total pounds-per-year as long as the different sources are located near each other and under common control. However, EPA has exempted oil and gas production from the aggregation requirement, meaning that the pounds-per-year limit is not met, and there are no regulatory controls for emissions of volatile organic compounds, hydrochloric acid, hydrogen sulfide and other hazardous pollutants, all of which are emitted in the course of fracking.
Chemical disclosure and proprietary products
One of the thorniest problems with the gas and oil fracking industry is that the public has been unable to access information about the nature, amounts, and concentrations of chemicals used in the fracking process.
Under the Emergency Planning and Community Right to Know Act, EPA is required to list industry groups that must release, on an annual basis, the names and amounts of hazardous chemicals that they release into the environment. The information is then compiled and released to the public every year as “the Toxic Release Inventory or TRI.”
So far, EPA has refused to list the oil and gas exploration and production industry on the TRI, meaning that the sector – including all oil and gas fracking wells – is exempt from any legal obligation to disclose their toxic releases.
On January 12, 2015, nine environmental groups sued EPA to require the agency to list the oil and gas hydrofracking industry as one of those subject to Toxic Release Inventory mandate. The groups stated, “The annual TRI reporting is critical to health, community planning, and informed decision making. Whether to add the oil and gas extraction industry shouldn’t even be a question at this point.”
The oil and gas industry has devised a voluntary reporting program, a website called FracFocus.org. Launched in 2011, it is intended to satisfy public demands for information. Fourteen states actually require well operators to use the website to disclose the chemicals used in their processes.
However, as reported last August in StateImpact Pennsylvania, a group called “SkyTruth” that attempted to access and aggregate FracFocus data concluded “information about tens of thousands of wells is technically available to the public, but in such an obscure, obtuse way that it’s impossible to look at it in aggregate.”
Moreover, companies need not disclose any substances or ingredients deemed by manufacturers to be proprietary or “trade secrets.” An April 2011 Report by the Committee on Energy and Commerce of the U.S. House of Representatives titled, “Chemicals Used in Hydraulic Fracturing” stated, “…In most cases the companies [carrying out hydraulic fracturing operations] stated that they did not have access to proprietary information about products they purchased “off the shelf” from chemical suppliers, [and claimed that] the proprietary information belongs to the suppliers, not the users of the chemicals.”
In a 2013 report, the Environmental Policy initiative at Harvard Law School gave FracFocus a failing grade as a disclosure tool.
EPA: Mostly sidelined, but filling some gaps
Despite being constrained by Congressionally imposed exemptions for the oil and gas industry in environmental statutes, EPA is working on three fronts to address environmental issues.
First, the agency has been working on a comprehensive study of fracking, with emphasis on the cycle of water use, from withdrawal to disposal. Drilling sites in Colorado, Pennsylvania, Louisiana, North Dakota, and Texas are the focus of the study. Announced in 2011, the study is proceeding slowly, with final results now pushed back to 2016.
Second, in April 2012, EPA promulgated regulations that address air emissions from new and modified fracked natural gas wells, focusing on reduction of volatile organic compounds (VOCs) like benzene, toluene, and xylene.
Oil and natural gas production is the United States’ largest industrial source of VOCs, and, according to a 2012 Environmental Health Perspectives Report, also emits nearly forty percent of the nation’s total methane. Many VOCs are associated with cancer, and cardiovascular, respiratory and neurologic damage and also are an ingredient (with NO2 and sunlight) in formation of ground-level ozone, or smog. Methane is twenty times more potent as a heat-trapping gas than carbon dioxide.
Although the regulations require process and equipment changes that, EPA claims, will annually cut ninety-five percent of the VOC emissions from newly fracked wells, environmentalists were disappointed that EPA addressed only new, rather than existing, fracking operations.
In early January, President Obama announced plans to cut methane emissions from oil and gas production up to 45 percent by 2025 from 2012 levels. Final regulations are slated to be released by 2016. But, like the VOC emission rules, the rules will address only emissions from new and modifying oil and gas production facilities.
Third, EPA is also in the process of promulgating pretreatment standards for wastewater discharges that are sent to municipal sewage treatment plants or private treatment plants, after which they are dumped into rivers, streams and lakes, or recycled for road dust suppression, agriculture use or the like. Many of the country’s treatment plants are not properly equipped to fully reduce chemical contaminants from fracking wastewater, and it is likely that discharges have been polluting rivers and lakes.
Of particular concern is that when fracking liquids bubble up from subterranean depths, they not only contain the chemicals that were added before drilling, but often contain “highly corrosive salts, carcinogens like benzene and radioactive elements like radium,” picked up from rocks and minerals, according to a New York Times 2011 story. EPA studies, and the drilling industry itself, have concluded, “radioactivity in drilling waste cannot be fully diluted in rivers and other waterways.” When EPA releases new effluent limitations for the industry, treatment plants will need to meet the more stringent standards, including, presumably, eliminating radioactive waste before discharging fracking wastewater.
State regulation: Can states have their cake and eat it, too?
Although EPA is attempting to carve out some areas where it can impose nationally applicable standards, most of the regulatory oversight of fracking — underground injection well controls (UIC), disposal, chemical reporting requirements, and siting and permitting of wells – has been left to the states. All but seven states run their own UIC programs, an important component of fracking.
State regulatory efforts must be viewed, however, in the context of the prosperity that can come with fracking. State economies are thriving in those states where hydrofracking is a major activity. Although the heated-up economies lead to increases in rents and commodities that can make life difficult for those left out of the new job market, for the most part, fracking has created jobs, raised wages, and put royalties and rents in the pockets of property owners whose land is leased for drilling. For example, Cabot Oil & Gas Corp. has spent $2 billion for leases in Susquehanna County, Pennsylvania since 2005. Moreover, donations from Cabot spurred construction of a new regional hospital.
Again taking Pennsylvania as an example, the state legislature passed Pennsylvania’s Impact Tax in February 2012. Stateimpact Pennsylvania reported that the impact fee has brought in $630 million to Pennsylvania ($204 million in 2011, $202 million during 2012, and $224 million in 2013). Sixty percent of the impact fee revenue is distributed to counties and towns where wells have been drilled during the year
That the fracking industry has conferred economic benefits on states has not prevented states from imposing regulatory requirements, but may have affected their stringency and enforcement. Typically, state regulations focus on site design, drilling procedures, well design, and handling of materials and waste. Most states also require pre-drilling testing of water to establish a baseline in case water sources are later contaminated. In addition, states oversee the disposal of wastewater.
But how effective are state regulations? Again focusing on the Pennsylvania experience, the answer may be, “nowhere near effective enough.”
According to a 2010 article in Citizens Voice, “Right-to-Know” request to the Pennsylvania Department of Environmental Protection (DEP) revealed hundred of spills at natural gas drilling sites over the five year period from 2005-2010. Documents showed that the DEP issued 421 notices of violation to 15 of the largest operators in the Marcellus Shale for spills that reached waterways, leaking pits that harmed drinking water, or failed pipes that drained into farmers’ fields, killing shrubs and trees.
A 2011 New York Times in-depth report on wastewater treatment plants concluded that “in Pennsylvania, [water] treatment plants discharged drilling waste into some of the state’s major river basins. Greater amounts of the wastewater went to the Monongahela River, which provides drinking water to more than 800,000 people in the western part of the state…and to the Susquehanna River…which provides drinking water to more than six million people…”
“The risks are particularly severe in Pennsylvania,” the article continues. “The level of radioactivity in the wastewater has sometimes been hundreds or even thousands of times the maximum allowed by the federal standards for drinking water…used for comparison [because] there is no federal standard for safe levels of radioactivity in drilling wastewater.”
Last August, as reported by the online news service, ClimatepPogress, the Pennsylvania DEP finally made public 243 cases of contaminated drinking wells from oil and gas drilling operations. Only after lengthy litigation initiated by the Associated Press news service under the Freedom of Information Act did the DEP release the reports. The cases occurred in twenty-two counties, with contamination attributable to “methane levels, wastewater spills, and well water that went dry or undrinkable,” according to ClimateProgress. Pennsylvania is not alone: New Mexico has more than 400 cases of contaminated drinking water, and West Virginia also has numerous confirmed claims.
Pennyslvania’s Inspector General released a report last July, stating bluntly that the rapid growth of natural gas fracking had left the DEP “unprepared to effectively administer laws and regulations to protect drinking water and unable to efficiently respond to citizen complaints.”
Newly elected Pennsylvania Governor, Tom Wolf, stated in a press conference in December, the day after New York banned hydrofracking, “I want to have my cake and eat it, too…I don’t want to do what New York did.” Governor Wolf promised to initiate a health registry for complaints related to fracking, and also wants to impose a new tax on drilling to fund education initiatives, according to StateImpact Pennsylvania.
Localities say “Enough”
While the federal and state governments try, with limited success, to make fracking safe, many of the cities and towns that are in the line of fire – experiencing firsthand the degradation of their health and their land and water resources – are saying “enough.” To date, 148 of the country’s cities have banned fracking, along with the states of New York, Vermont, and Hawaii. Connecticut has imposed a three-year moratorium on in-state disposal of fracking wastewater.
When New York’s Governor Cuomo imposed a statewide ban on fracking in December, more than 170 New York cities and towns had already laid the groundwork for his decision by banning the practice. Invoking their right to zone their cities as they chose under principles of home rule, the cities had fought their way through the lower courts to the New York Supreme Court, which ultimately upheld the towns’ rights in June 2014, rebuffing a powerful group of oil and gas-company plaintiffs.
Similar zoning claims are being invoked in Ohio and Colorado by the towns of Munroe Falls in Ohio’s Summit County, and Longmont, Colorado. Both towns have claimed that their zoning authority to restrict fracking preempts the authority of their states to allow it.
In Munroe Falls, the city used zoning laws to require a wider berth around the underground injection wells than what is required under state laws, according to a November article in the Columbus Dispatch.
Injection wells that had been granted permits by the state were blocked by the city from locating in an industrial park. The city attorney explained, “No company would be willing to invest millions of dollars to establish a new plant in an industrial park when that new plant would be located right next to an injection well operation” The case has been heard by the Ohio Supreme Court and, as of this writing, has not yet been decided. Five other Ohio cities have voted to ban fracking altogether.
The City of Longmont, Colorado voted to outlaw fracking in 2012, but was blocked by the Colorado Oil and Gas Association, which fought successfully to overturn the ban in district court. The Association had already prevailed in convincing the district courts to overturn bans by the Colorado cities of Fort Collins and Lafayette. The New York Times reported in January that Longmont is appealing the adverse decision. Fort Collins will also continue its fight to impose a five-year drilling moratorium in the city. The smaller city of Lafayette, however, was easily outspent in litigation and eventually acceded to the drilling-company plaintiff.
Ground-zero for fracking activity is Texas, with more natural gas wells than any other state. But the behemoth industry presence didn’t stop the small town of Denton, Texas from passing a drilling ban in the November 2014 elections. It remains to be seen, however, whether it can maintain the ban, which was promptly challenged by the Texas Oil and Gas Association and the Texas Land Office.
In Pennsylvania, the State itself attempted to preemptively prevent its cities from “zoning out” natural gas hydrofrackers by enacting Act 13 in February 2012. The Act prevented local municipalities from exercising their authority to zone as they saw fit, whether controlling the location of wellpads, rigs and waste pits or by outlawing hydrofracking altogether.
The Pennsylvania Supreme Court ruled that these provisions of Act 13 were unconstitutional because the limits on local governments violated the “Environmental Rights Amendment” of the Pennsylvania Constitution. Specifically, the court struck down the provision of Act 13 that stated: “’environmental acts’ are of statewide concern and preempt local regulation of oil and gas operations.” Disagreeing vehemently with the preemption language, the court stated “…at its core, this dispute centers upon an asserted vindication of citizens’ rights to quality of life on their properties and in their hometowns…. By any responsible account, the exploitation of the Marcellus Shale Formation will produce a detrimental effect on the environment, on the people, and future generations…”