As Pennsylvania’s natural gas industry has boomed, neighboring states including New York, New Jersey, and Maryland have taken steps to curtail gas drilling and infrastructure.
Now, a state senator wants to prevent them from purchasing gas produced in Pennsylvania.
Sen. Gene Yaw, R-Lycoming, who chairs the Senate Environmental Resources & Energy Committee, announced at a natural gas industry conference Wednesday that he intends to introduce a bill blocking the transportation and sale of Pennsylvania-produced natural gas to states that have blocked fracking and pipeline expansions.
The remarks, delivered in Yaw’s keynote speech at the UpStream PA conference, were first reported on a blog written by former Department of Environmental Protection Secretary Dave Hess. The conference was hosted by groups with ties to the Marcellus Shale drilling industry.
In his address, Yaw took aim at New York Gov. Andrew Cuomo, who has led that state’s ban on hydraulic fracturing — or fracking — and pipeline expansions. New York continues to process imported natural gas, including large volumes from Pennsylvania.
Yaw told gas industry professionals that those policies have “stalled infrastructure development” that’s necessary to create new markets for natural gas in the U.S. and across the world, leading to price disparities that benefit international competitors at the expense of Pennsylvania producers.
Yaw noted that states have imported gas from Russia since New York scaled back its own gas production.
“As lawmakers, we have an obligation to be aware of the competing interests that involve our state and the nation,” Yaw said, according to remarks published by his office. “New York, New Jersey and Maryland have worked to limit the expansion of pipelines, which curtails our ability to market Pennsylvania produced natural gas. In keeping with the wishes of those states to impede marketing, I intend to introduce a measure, which would prohibit the transportation and sale of any Pennsylvania natural gas that is produced by fracking to those states.”
It’s unclear whether Yaw’s proposal would violate the U.S. Constitution’s commerce clause, which says that only Congress has the power to regulate international and inter-state trade.
Yaw could not be immediately reached for comment through his staff Thursday.
Yaw also used his keynote to address other pending issues in the natural gas sector, including the severance tax that Gov. Tom Wolf has proposed every year he’s been in office.
Pennsylvania is the second-leading natural gas producing state in the country, but it’s the only gas-producing state without a severance tax, which drillers pay based on how much gas they extract from the earth.
Instead, gas companies in Pennsylvania pay an “impact fee” for every well they drill. The fee has raised more than $1.4 billion since it was enacted in 2012, according to StateImpact.
Much of the money raised by the impact fee goes back to communities where drilling takes place.
Yaw’s own district has received more than $250 million in revenue from the impact fee, he said, making it vital that the impact fee remain intact, and not be replaced with a severance tax as Wolf has proposed.
“I do not know of any time when this much money was sent back to our local governments without a long, involved grant process,” Yaw said.