Backtracking on fracking

Western Maryland is blessed with an enormous amount of cleaner burning natural gas and we need an all of the above approach to energy. I am concerned that there has been a knee-jerk reaction against affordable energy production in our state. Maryland is definitely behind the curve because this administration has decided to politicize the issue rather than take a balanced approach to ensuring we have access to clean and affordable energy sources to power our homes and businesses and grow our economy.

States throughout the country including our neighbors develop their natural gas resources safely and efficiently. Many of these states are realizing an economic boom through gas and oil exploration and are working in concert with groups like the Natural Resources Defense Council to harness these vast resources of domestic energy in an environmentally sensitive way.

Larry Hogan, in response to a WYPR-FM candidate survey, May 2014. (Emphasis mine.)

Three years later, western Maryland is still blessed with an enormous amount of cleaner-burning natural gas, but on Friday Governor Hogan decided it would be better to leave this valuable resource in the ground rather than create jobs and economic opportunities for a section of the state that lags behind the rest of Maryland when it comes to those two very things.

Perhaps we should have seen this coming, though: the temporary moratorium that was in place stemmed from a bill that Hogan allowed to become law without his signature rather than veto it back in 2015. The bill, which as originally introduced was laughably intended to “protect our health and communities,” was amended from a ban extending to 2023 to a prohibition intended to last until October of this year, when the Maryland Department of the Environment was to have regulations in place. But, as Governor Hogan noted in his press conference announcing the new fracking ban, Maryland envisioned the most stringent regulations in the nation – a roll of red tape that would have amounted to a de facto ban if enacted.

And to illustrate the political pressure Radical Green can put on wobbly members of the GOP, bear in mind that the original third reader vote on the 2015 House bill had 45 opposed, but that number whittled down to 33 once the Senate version passed and the House bill (as amended to match the Senate version) went to third reader. The wobblers who changed their votes were Delegates Anderton, Afzali, Beitzel, Carozza, Krebs, Malone, McComas, Miele, Shoemaker, and West. (This list is ten because two Delegates who voted “no” originally were absent the second time, but Afzali changed her vote after the fact to be truly gutless. Interestingly enough, Delegates Anderton, Carozza, Krebs, and Shoemaker all changed back three days later when the Senate third reader came to the House while Delegate Saab opted to join the dark side.) Conversely, the Senate only had two votes correctly in opposition all along, Senators Hough and Ready.

Now we can add Larry Hogan to the list that has wobbled and fallen – this despite a mountain of evidence that hydraulic fracturing, which has been ongoing for over six decades, is safe when done properly. Even the EPA, which put out a final report in the waning days of the Obama administration, noted they found scientific evidence that hydraulic fracturing activities can impact drinking water resources under some circumstances. Yet many of the circumstances they point out could occur at any chemical plant, and they note:

Data gaps and uncertainties limited EPA’s ability to fully assess the potential impacts on drinking water resources locally and nationally. Because of these data gaps and uncertainties, it was not possible to fully characterize the severity of impacts, nor was it possible to calculate or estimate the national frequency of impacts on drinking water resources from activities in the hydraulic fracturing water cycle.

So should I point out again that over 2 million wells have been hydraulically fractured over the last six decades without incident? It seems to me that past performance should be a very good predictor of future results, particularly as the technology advances. And if you read the report, you’ll note that the uncertainty of cause even extends to those limited, rare incidents blamed – many times falsely – on fracking and most publicized by Radical Green.

No one denies there is risk with hydraulic fracturing – just as there are documented issues with low-frequency noise and impacts on bat population with wind turbines and potential for environmental impact as more and more solar panels are spread over the landscape to significant effect – but the rewards from fracking, as measured by both local economic benefits and the lessening of reliance on foreign energy supplies, have been found to outweigh the risks in nearly every jurisdiction where fracking is possible, while the recalcitrant others (Maryland and New York) have believed the hype over the facts.

While Maryland is a small part of the Marcellus Shale formation that has produced the resurgent energy industry in a region that first benefitted over a century ago from an oil boom – there’s a reason we have motor oil from Pennzoil and Quaker State and it’s not because the brand names are cute – this is a time when the domestic oil and natural gas industry is in a holding pattern. Crude oil prices in the $40-50 a barrel range and a relatively constant balance of natural gas supply and demand means that Maryland missed the boat by about a half-decade in the current cycle, but an increased potential in natural gas exports – coupled with a multi-billion dollar investment in Maryland’s Cove Point facility for LNG exporting that’s slated to come online later this year – means our state would have been in good position to benefit in a few years’ time once natural gas exploration began and delivery infrastructure was put in place. (People tend to forget that part of the equation, too.) But politics, embodied in the baseless fear caused by a noisy environmental lobby, ruled the day Friday.

Allow me to let you in on a dose of common sense: there’s no way in hell Radical Green will give Larry Hogan any credit for what he did on fracking come election time. You can bet your bottom dollar that they will flock to whoever the Democrats end up anointing in their primary because their main goal isn’t a clean environment but to have statists in charge of government. Yes, the rank-and-file who might send a couple hundred dollars to the Chesapeake Bay Foundation every year may really care about the health of the bay, but when the people who benefit most from it are the ones who determine the annual “grade” for the cleanliness of the Bay one has to wonder how much of their thumb is placed on the scale. After all, if the Bay had a grade of A and was pristine H2O, what need would there be for a CBF?

The oil and gas industry doesn’t depend on a government subsidy – they just want a fair and predictable regulatory scheme. But a state which has no problem bending the energy trade by mandating a certain percentage of electricity comes from solar energy and demanding ratepayers subsidize an offshore wind farm seems to have an issue with the source that’s been proven reliable over time and is known as a job creator.

As a ratepayer and voter, I was willing to accept the slight environmental risk of fracking in return for a more prosperous state overall as well as more inexpensive and reliable energy. (And yes, I know that the area in question isn’t one where I live. But if I ever secure a piece of land nearby and someone wants to pay me for the right to use my land to explore for energy resources, I’m glad to oblige. No one has yet assessed the Delmarva Basins on which many of us live for their energy potential.)

In 2014, Allegany and Garrett counties provided almost 1/4 of Larry Hogan’s margin of victory as he carried the duo by 16,466 votes in an election he won by 65,510 votes. Add in adjacent Washington County and that number becomes 35,274 votes, or over half his victory margin. At the risk of losing thousands of votes in that region, Larry Hogan has acquiesced to an environmental lobby that’s not going to give him any credit, any dollars, or any votes for the decision he’s made.

I suppose Larry Hogan thinks he’s got an all-of-the-above electoral strategy, too. But at a time he could have changed Maryland for the better, he instead foolishly chose to surrender to the naysayers.

This will leave a mark

July 29, 2014 · Posted in Business and industry, Campaign 2014, Maryland Politics, National politics, Politics, Radical Green · Comments Off on This will leave a mark 

Although Jenna Johnson’s Washington Post piece described Governor Martin O’Malley as “brusque…terse and often lack(ing) patience” during a Board of Public Works meeting, that meeting still netted Dominion Resources another small step toward investing $3.8 billion into upgrading their Cove Point facility by allowing them a tidal wetlands license. O’Malley joined Comptroller Peter Franchot and Treasurer Nancy Kopp in approving the permit, leaving only federal authorities in the way. The permit was for a temporary pier to offload construction supplies for the project, which environmentalists fear will lead to further extraction of natural gas in the region for export.

To me, it wasn’t a vote O’Malley wanted to take, and he really didn’t have to – his vote against would have only made it a 2-1 decision. But to do otherwise would have left another black mark on his administration’s legacy of making Maryland one of the states most unfriendly to business in the nation, even though the permit would have gone through.

And it’s not like environmentalists aren’t winning the war despite losing that battle – the prospect of fracking in Western Maryland is growing dimmer by the day given some market saturation and the outlandish regulations proposed for drilling – never mind the possible benefits that would bring. But O’Malley had to disappoint the few hundred who are passionately opposing the remodeling of the LNG terminal in Calvert County.

Cove PointAt this point, though, it’s all about promoting the legacy and let’s face it: are the environmentalists going to vote for Larry Hogan? Well, there is that slight possibility but when the Washington AFL-CIO and other trade unions support Cove Point, O’Malley can’t afford to alienate that group. That’s hundreds or even thousands of motivated voters he has to keep in the Anthony Brown camp. So Martin O’Malley will hold his nose and vote for Cove Point, all the while hoping that his buddies at the EPA or somewhere else in the federal government will bail him out by turning thumbs-down on the project at a late stage. After all, if they can stall the Keystone XL pipeline for this long, pushing back a project just a few miles outside Washington, D.C. is almost a no-brainer to them.

So when Martin O’Malley acts like a petulant child in a meeting because he knows he has to take an unpopular vote, we shouldn’t feel any sympathy for him. He’s left a whole lot on the table insofar as benefiting from our American energy boom goes and he knows it.

 

Pointing out and planning solutions

In life there is a difference between saying and doing. In this case neither protagonist, unfortunately, is in a position where they can do much more than talk and advocate but it is interesting to see what the two men in question have to say about a paticular situation.

First I’ll point out the talker:

More and more of our friends and neighbors are unemployed and our state economy remains stalled. Clearly, the economic policies of Martin O’Malley and Anthony Brown have failed, and it’s time for new leadership and a new direction in Annapolis.

The O’Malley/Brown Administration continues to drive taxpayers and job creators from Maryland and into the arms of better run, lower cost states.

Those were the words of gubernatiorial candidate Larry Hogan, whose campaign went on to point out that 9,800 Marylanders were furloughed in January and the state endured its worst year of job creation since the recession ended in 2009. (At least for some parts of the state, the question of whether we are back in one is open for debate.)

I will give some credit to Larry for beginning to round out a platform which doesn’t simply bash the incumbent and his heir apparent for tax increases or cite his group’s social media prowess:

Hogan, a business leader and former Maryland state cabinet secretary, favors a pro-growth agenda that combines reigning (sic) in Annapolis spending, jump starting the economy by cutting taxes on workers and their employers, and aggressively courting larger employers which in recent years have left Maryland for Virginia and other states.

We’re still a little vague as to specifics, but the ideas are mostly right out of the conservative playbook and certainly won’t hurt. I’m ever-so-slightly leery of the “cutting taxes on workers and their employers” line because that suggests only a targeted tax cut rather than the flattening (or complete elimination) of rates we need, but we’ll see where Larry goes with this one.

On the other hand – and I really wish he had said it a month ago, because it would have went perfectly with this post – David Craig has a grand idea:

Harford County Executive and Maryland Governor Candidate David Craig called on incumbent Governor Martin O’Malley to push the Obama Administration to complete a final regulatory review to enable a facility in southern Maryland to export liquefied natural gas. The issue takes on greater urgency as the Ukraine and several European countries seek long-term solutions to reduce dependence on Russian energy exports.

“Now is not the time for dithering and red tape,” said Craig. “Maryland is on the verge of being only the second state in the country to export liquefied natural gas and our proximity to the Marcellus Shale, and the Atlantic Ocean and existing infrastructure gives us a competitive advantage that nobody else has. Maryland can attract thousands of energy sector jobs and help assert U.S. influence in the crisis in the Ukraine. But we must act now.”

Ambassadors to the U.S. from Hungary, Poland and the Czech and Slovak republics wrote House Speaker John Boehner last week that U.S. “natural gas would be much welcome in Central and Eastern Europe, and Congressional action to expedite [liquefied natural gas] exports to America’s allies would come at a critically important time for the region.”

The U.S. Department of Energy has approved just six export licenses for LNG projects, including Cove Point, since 2011. Dominion Resources-owned Cove Point, in Lusby, MD, is one of about 20 U.S. projects that want to export LNG. Of those, only one, in Louisiana, has full federal permitting.

Delays in Maryland are coming on multiple fronts. Political support among the O’Malley-Brown Administration is non-existent. Gubernatorial candidate and legislator Heather Mizeur is leading the charge in outright opposition to the project, while Lt. Gov. and front-runner candidate Anthony Brown promotes “environmental justice,” a left-wing social movement that attempts to stifle energy exploration wherever politically-favored constituencies may object. The other democratic gubernatorial candidate, the current Attorney General, is opposed to timely approval of the project. Apart from general statements about the importance of developing jobs and traditional forms of energy, GOP primary candidates for Governor have heretofore not yet articulated positions on the issue. (Links added.)

Given my interest in energy-related issues, I can’t believe I missed that originally – the release has been out about a week – but I’m glad David Craig is coming out on the right side of this issue. As I pointed out last month, Dominion Resources, the operator of the Cove Point facility, estimated that 4,000 construction jobs and 14,600 permanent positions could be created through this $3.5 billion investment. Those could be 14,600 people paying taxes and investing in our communities rather than wondering what comes next after the unemployment runs out or making plans to escape Maryland for greener pastures like Virginia, the Carolinas, Florida, or Texas. Democrats often talk about making “investments” with our tax dollars, well, here’s an investment that the private sector is willing to make and government is mad because they can’t control who receives it. Let’s throw them a pity party: awwwwwwww….

Running mate Jeannie Haddaway made another good point in that statement:

Instead of picking winners and losers and subsidizing the most expensive options such as wind energy, we should be taking advantage of our existing resources and diversifying in a way that is meaningful to our economy and to job creation.

The choice is clear, the opportunity is now.

I look at it this way: if there were a market for wind energy, we would already have plenty of infrastructure out there. But the fact we have to subsidize its meager presence and carve out market share for it tells me wind is an economic loser overall. Just like solar energy, it’s only as reliable as atmospheric conditions allow it to be. And while solar and wind are considered “green” energy, the birds being cooked or bats being exterminated might beg to differ.

So we can exacerbate the unemployment problem or we can put the people in place to help create jobs. It’s your choice, Maryland.

Denying the market

To be honest, I’m not sure if I was sent this to provoke a comment or if I just happen to be on a list that gubernatorial candidate Heather Mizeur doesn’t use all that often. I think most observers know I have an interest in energy issues, and this definitely falls into one of them. You just have to ask yourself why Mizeur counts herself among the Democrats are so insistent on denying the opportunity for shovel-ready jobs and investment – I thought that was what they were all about.

First of all, this is what Mizeur had to say about the proposed Cove Point LNG export facility.

(Yesterday), Delegate Heather Mizeur (D-Montgomery), candidate for governor, called on Governor O’Malley to join her in opposition to the Dominion Resources liquefied natural gas (LNG) export facility at Cove Point in Calvert County. She made the announcement during a speech at the Stop Cove Point Rally in downtown Baltimore City earlier today.

“I am calling on Gov. O’Malley to take a stand with us today to reject Cove Point,” Mizeur told the audience. “You cannot leave a legacy on addressing climate change and be silent on Cove Point. It’s time for Gov. O’Malley to break the silence and join us in saying no to Cove Point.”

The rally, which was attended by 500 people, was organized by climate, health and anti-fracking activists from across the state, and was one of the largest environmental rallies ever in Baltimore City. It came as the state Public Service Commission begins official hearings on the project.

Mizeur is currently the only gubernatorial candidate to state her opposition to the project. When she announced her opposition in December, both Lieutenant Governor Brown and Attorney General Gansler – the two other Democratic candidates in the race for governor – expressed a desire to build the project without environmental damage, but failed to explain how such a plan would be possible.

Dominion Resources, a Virginia-based energy company, is pursuing the construction of a $3.8 billion facility to serve as a collection point for fracked natural gas from throughout the Mid-Atlantic region, where cargo tankers would then ship it throughout the world.

But the Cove Point facility would release 3.3 million tons of carbon dioxide and other harmful greenhouse gases into the air annually, making it a serious setback to achieving the state’s goals on fighting climate change, including a plan for a 25% reduction of greenhouse gases by 2020.

Mizeur has also called on Dominion Resources to invest $3.8 billion – the construction cost of the proposed facility – in the state’s renewable energy sector. According to the U.S. Department of Energy, clean energy investments create more permanent jobs than exporting fracked gas.

Obviously Mizeur is an adherent to the religion of manmade climate change, a belief system which fails to address why none of the climate models have predicted the lack of warming this century. The fact that they managed to get just 500 people to a climate change rally shows how small the cadre of believers really is – a good Second Amendment or TEA Party rally can rustle up similar numbers without really trying. If this is “one of the largest environmental protests in state history” then we really are letting a tiny minority dictate policy.

But let’s say these guys are really serious – I suppose living in a state foolish enough to believe that artificially limiting its carbon emissions will have an effect on our overall global climate will do that to you. Even if the point source of 3.3 million tons is correct, it doesn’t take into account the reduction in emissions at destination points abroad. Natural gas is cleaner burning than coal, and until we figured out that fracking was a way to supercharge the moribund domestic natural gas market it was a fossil fuel environmentalists weren’t uncomfortable with. To show how the market has changed, the Cove Point facility was originally built in the 1970s as an import facility because the domestic natural gas market was thought to be in an irreversible decline.

On the other hand, the point source investment of $3.8 billion will have a positive effect on the regional and state economies. Last year, in announcing its filing, Dominion claimed the project will create up to 4,000 jobs during the construction phase and perhaps over 14,000 jobs overall, not to mention billions in royalty payments. Because most of the supply would come from regional producers, the entire mid-Atlantic area would benefit (except Maryland and New York, which currently have bans on fracking.) The facility would also provide a needed boost to our export tally to address a persistent American trade deficit, as the LNG is already contracted out to distributors in Japan and India.

Finally, Mizeur complains that the $3.8 billion Dominion is willing to invest in the project could be better spent in the renewable energy sector. Does the name “Solyndra” ring a bell? Despite its best efforts to create a market for offshore wind, companies aren’t willing to make the investment in that area – remember Bluewater Wind? In the area of solar energy, it took billions in taxpayer-guaranteed loans – and mandated renewable energy portfolios such as the one Maryland is saddled with – to get that market off the ground, yet it still produces but a tiny fraction of our electricity needs at a cost several times the going rate for electricity produced from coal or natural gas.

And it’s funny that Mizeur worries about the cost of natural gas going up due to exports, but had no problem with raising the gasoline tax on a perpetual basis. So much for supporting hard-working Marylanders.

So the choices are either zero or $3.8 billion; that’s reality. We can take advantage of proven resources we already have or listen to alarmists whose real goal is to foster dependence on government under the guise of saving the planet. It’s just too bad our little sandbar is energy-poor, unless you deign to call chicken manure an energy gold mine, and even the proponents concede its not as efficient as natural gas.

  • I haven't. Have you?
  • Categories

  • Archives

  • Link to Maryland Democratic Party

    In the interest of being fair and balanced, I provide this service to readers. But before you click on the picture below, just remember their message:

  • Part of the Politics in Stereo network.