PA Supreme Court Rules on Act 13 Gas Drilling Law

You may have heard that the Pennsylvania Supreme Court recently overturned several key provisions of the state’s controversial Act 13 law which regulates the oil and natural gas industry. Act 13 was enacted in 2012 as a comprehensive update to the state’s oil and gas law to reflect the current activity in the Marcellus Shale natural gas play that underlies a broad swath of PA. Because I’ve written in the past about issues I have with the state of natural gas drilling in the Keystone State, I thought I should comment on the December 19 Supreme Court decision.

I don’t dispute that PA’s oil & gas laws needed to be updated to reflect the unprecedented expansion of natural gas exploration and extraction of Marcellus Shale natural gas over the past 6 years. While a few elements of Act 13 were reasonable updates to the oil & gas law, some elements simply went off the deep end. Just as our U.S. Congress often tries to sneak provisions that favor a particular interest into otherwise good, commonsense legislation, the PA Legislature and Governor Corbett got away with sneaking some pro-industry garbage into Act 13.

One of my biggest problems with Act 13 was that it allowed the gas industry to override local zoning laws. So a gas company could conceivably have drilled in a residentially zoned area or a pipeline company could have built a compressor station or a pipeline right next to a school or daycare center. Many Pennsylvanians who don’t live in the Marcellus Shale regions did not realize that this provision of Act 13 could directly affect them if a natural gas pipeline was someday proposed to cut through their community to transport gas from the gas fields to out-of-state destinations. Fortunately, that zoning override has been declared unconstitutional.

Act 13 also contained a provision many physicians interpreted as a gag rule. While physicians could request lists of chemicals used in gas drilling, including proprietary chemicals claimed to be trade secrets, many doctors felt Act 13’s language did not adequately protect them from legal action by gas companies if they shared the chemical information with their patients potentially exposed to drilling chemicals or with other physicians to collaborate on diagnoses and treatment for patients. When a Pittsburgh physician challenged this provision of Act 13, the Commonwealth Court earlier this year ruled that the doctor had no standing to challenge the provision, because he had not actually requested chemical information from drillers or been blocked from communicating such information to his patients. In their Act 13 decision, the Supreme Court determined that the Pittsburgh doctor has legal standing to challenge the law and sent the case back to Commonwealth Court to reconsider.

State Senate President Pro Tempore Joe Scarnati and House Speaker Sam Smith, both Jefferson County Republicans, released a joint statement saying they were “stunned” by the high court’s ruling and warning the ruling would "harshly impact the economic welfare of Pennsylvanians." I sense that Scarnati and Smith are really only concerned about the present day economic welfare of gas companies and are paying no regard to the potential adverse legacy of the current Marcellus Shale exploitation for Pennsylvanians. PA does not have a favorable track record of energy companies sticking around to clean up their messes after extraction of their target commodity has reached its limit of economic viability. When this gas play is depleted in 20-30 years, will the state be left to clean up hundreds of drilling pad sites around the state using inadequate funds from the performance bonds the drillers had posted decades earlier?

Photo of coal mining spoils in Pennsylvania from Abandoned Mine Reclamation Clearinghouse website (www.amrclearinghouse.org)

Take a drive through PA’s coal regions today, and you’ll still see gaping scars on the landscape where many coal companies, after they had mined-out the coal deposits on their lands in the first half of the 20^th century, abandoned their responsibility to repair the landscape and mitigate the acid mine drainage they had created. The state is still spending public funds to remediate the legacy environmental pollution from irresponsible coal companies.  The rush to tap into and bring to market the Marcellus Shale’s vast natural gas reserves has created the potential for similar corporate recklessness under the mantle of energy independence (which is BS – read what I wrote previously about exporting PA’s natural gas overseas).

I think one of the best results of this ruling was Chief Justice Ron Castille calling a spade a spade: "By any responsible account the exploitation of the Marcellus Shale Formation will produce a detrimental effect on the environment, on the people, their children, and the future generations, and potentially on the public purse, perhaps rivaling the environmental effects of coal extraction."

Castille added that although the state has potentially broad regulatory powers, those powers are limited by PA’s Environmental Rights Amendment. He was referring to Article I, Section 27, of the PA state constitution, ratified by PA voters in 1971:

The people have a right to clean air, pure water, and to the preservation of the natural, scenic, historic and esthetic values of the environment. Pennsylvania's public natural resources are the common property of all the people, including generations yet to come. As trustee of these resources, the Commonwealth shall conserve and maintain them for the benefit of all the people.

Hopefully this Supreme Court ruling will frame how the public’s environmental rights will be interpreted for future generations of Pennsylvanians, effectively stripping the football from special interests and making them play defense going forward. Hopefully.