NCPA - National Center for Policy Analysis

Federal Agencies Threaten Fracking

December 6, 2013

Two federal agencies are threatening to regulate fracking, says Nicolas Loris, a senior policy analyst at the Heritage Foundation.

Currently, the Bureau of Land Management (BLM) is in the process of finalizing a rule that would impose stricter regulations for fracking on federal and Indian lands. The Environmental Protection Agency (EPA) is also looking closely at fracking, conducting a study on the impacts of the technique on groundwater.

The upcoming BLM regulations would establish minimum standards for chemical disclosure, well integrity and wastewater disposal. But the states already have regulations to deal with these concerns.

  • The BLM projects that its regulation will increase costs to each well by $3,000-$5,000, but that number does not paint the full picture. Independent analyses project the cost to be closer to $100,000 per well, with no meaningful benefit to the environment.
  • The federal regulations propose that the states that meet the federal standards will still be able to enforce their own regulations. But because the federal rules are more stringent than the state regulations and more rigid than best industry practices, states will lose their flexibility to regulate.

The EPA is expected to release its drinking water report in 2014, which will be available for public comment.

  • Rep. Lamar Smith of Texas is sponsoring H.R. 2850, the EPA Hydraulic Fracturing Study Improvement Act. The law would require the EPA's report to undergo a rigorous peer review and require "objective estimates of the probability, uncertainty, and consequence of each identified impact, factoring in the risk management practices of states and industry."
  • H.R. 2850 would make it more difficult to use the fracking report for political purposes.

According to the National Petroleum Council, up to 80 percent of new natural gas wells drilled domestically in the next decade will require fracking. Fracking lowers energy costs and leads to cheaper goods and services for consumers. On top of this, fracking has led to job growth. A report from IHS Global Insight determined that shale oil and gas supports a whopping 1.7 million jobs, which should increase to 3 million by 2020.

New federal fracking regulations are unnecessary (as the states have already proven themselves capable of regulating the process) and would only drive up costs, limiting the ability of states to manage their own resources. States should be given more control over the federal lands in their states.

Source: Nicolas Loris, "Protecting the States' Ability to Regulate Fracking," Heritage Foundation, November 19, 2013.


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