"This is simple," began state Sen. E.S. "Buck" Newton at a commerce committee meeting yesterday. "This country needs the energy and this state needs the jobs."
Newton, who represents Johnston, Nash and Wilson counties, is a primary sponsor of Senate Bill 76, which would allow hydraulic fracturing, or fracking, to begin in North Carolina in early 2015. Despite substantial opposition from environmental groups and landowners concerned about impacts on their properties, the bill is moving quickly through the legislature under the cheery alias, the Domestic Energy Jobs Act.
The new bill revamps last year's fracking measure, SB 820, by deleting a number of important regulatory safeguards. In other states, such as Pennsylvania, contamination in drinking water wells, in rivers and at wastewater treatment plants have been linked to nearby fracking operations.
For bill supporters, fracking represents an opportunity for economic growth. They anticipate the creation of thousands of jobs, both directly and indirectly related to the energy industry, taking cues from boom towns in North Dakota and Texas.
Newton, who asserted estimates of 15 trillion to 30 trillion cubic feet of natural gas underfoot, treats the bill as a message to energy companies. "North Carolina is ready to do business. We want their investment— we're ready to create jobs."
However, as INDY Week has reported, the number of jobs and amount of accessible natural gas is unknown—and highly speculative.
Opponents question whether the state's shale resources are really as "abundant" as Newton claims, which fuels skepticism on job prospects. Sen. Floyd McKissick, a Durham Democrat who opposes the bill, noted after the meeting that some estimates show fracking would produce a relatively measly 500 jobs. And it is unknown how many of those jobs would go to North Carolinians.
The regulatory changes are the most troubling aspects of the bill.
Among the changes, the bill removes the requirement for a state geologist on the Mining and Energy Commission. "N.C.'s unique geologic features are at the heart of devising a safe regulatory framework," wrote Molly Diggins, state director of the Sierra Club, in an email.
It also removes requirements for representatives from the Environmental Management Commission and the Commission for Public Health. McKissick questioned the wisdom of eliminating representatives with expertise in air and water pollution and waste management.
Newton said the requirements presented a "conflict of interest" and are "too restrictive and too difficult" to achieve.
It’s ironic that Newton is concerned with conflicts of interest because the Mining and Energy Commission, tasked with preparing regulations for fracking, is packed with energy and fracking interests.
The bill also incorporates changes that will affect:
Local control: Limits the ability of local governments to offset negative impacts on their communities by setting impact fees.
Legislative regulation: Eliminates the requirement that the Legislature review a set of regulations submitted by the Mining and Energy Commission, which enables the Department of Environment and Natural Resources to issue permits before regulations are in place.
Landowner safeguards: Repeals the Landmen Registry, designed to protect landowners from unreliable land agreements.
Groundwater protection: Places fewer restrictions on the disposal of fracking waste into groundwater.
Production limits: Removes production limits on oil and gas.
Offshore drilling: Encourages the Governor to join forces with South Carolina and Virginia to pursue offshore drilling.
These changes, especially those relating to groundwater protection and offshore drilling, concern environmental advocates. “It’s one thing to send a message that North Carolina is open for business," said the N.C. Sierra Club in a statement responding to the hearing. "It is yet another to spur oil and gas development by removing protections for the public.”
Elizabeth Ouzts, director of Environment North Carolina, says the bill threatens water quality. She noted that fracking waste, which contains carcinogens and other toxic materials, has been linked to more than 1,000 cases of drinking water contamination.
Fracking could endanger natural resources like Jordan Lake and the Eno River, said Ouzts, not to mention the many North Carolinians who rely on private drinking water wells.
Economic concerns are not lost on environmental groups. Last week at the finance committee hearing, Ouzts offered the example of Dimrock, Pa., where it cost $109,000 to repair contaminated water systems for 14 houses.
Ouzts reminded the commerce committee that North Carolina is already in the energy business, having recently created 20,000 jobs in clean energy.
While those like Diggins and Ouzts worry the bill is moving too fast, Bill Weatherspoon of the American Petroleum Institute believes we've waited long enough. "A state could not move slower and more responsibly and more carefully than North Carolina."
For Ouzts, the bill represents the wrong direction for North Carolina's natural energy pursuits. "They talk as if North Carolina is going to become this great oil and gas state like North Dakota, but it's a fantasy—or rather a nightmare."