Yaw: Pennsylvania Shouldn’t Rely Solely on Feds to Cap Abandoned Wells

The Department of Environmental Protection (DEP) estimates Pennsylvania has as many as 560,000 abandoned oil and gas wells, all of which are leaking dangerous climate-altering methane unfettered into the air we breathe.

The International Energy Agency says methane is the second most concerning greenhouse gas, behind carbon dioxide, and one whose reduction could produce enormous short-term atmospheric benefits that would help Pennsylvania, the United States and other nations signed onto the Paris Agreement, reach its climate goals.

Congress just gave Pennsylvania $104 million as part of its infrastructure investment package to help the state tackle this problem. It’s a sizeable chunk of money that will cap thousands of wells in the next decade using a process that costs anywhere from $10,000 to $100,000 per well, according to DEP.

But it’s not nearly enough. The DEP spends roughly $1 million annually to cap about 10 wells and has managed to remediate more than 3,300 since 1984.

In pursuit of the $4.7 billion in funding appropriated to this program, the agency told the federal government it identified more than 26,000 wells in need of plugging, at a cost of $1.8 billion. So, even if Pennsylvania receives the full $400 million it anticipates, it’s nowhere near enough to address the hundreds of thousands of abandoned wells both state and independent analysts believe exist in Pennsylvania.

That’s why I sponsored Senate Bill 945.

The legislation directs the Department of General Services to sell 361,000 renewable energy credits (RECs) the commonwealth earns annually as part of its 15-year solar power procurement deal struck with Constellation to generate money to cap more wells. All told, the state could collect an estimated $165 million during the life of the contract for this purpose.

It’s not the billions of dollars we need to plug every well, but it’s a dedicated and recurring revenue stream that will address several thousand more sites than DEP could with just federal money alone.

The procurement deal – dubbed Pennsylvania PULSE – announced by Gov. Tom Wolf in March means the state will generate nearly half of the power it uses from solar energy. DEP Secretary Patrick McDonnell said at the time that reducing greenhouse gas emissions “is crucial to slowing climate change and protecting our health and safety, environment and economy.”

So why does the administration oppose the legislation? Because it would rather hoard the RECs and tout its commitment to reducing the state’s carbon footprint like a green badge of honor instead of capitalizing on the value the credits hold.

In their warped view, selling the credits not only weakens the marketplace, but undermines the effort the state went through to procure the solar energy in the first place.

The administration has no way of knowing how the market will respond to an influx of credits. Residents ultimately foot the bill for PULSE, RECs and other renewable projects because our state’s Alternative Energy Portfolio Standards (AEPS) allows utilities to pass the cost of these initiatives on to ratepayers.

If the commonwealth sells these credits to other power producers hoping to offset its own emissions, thereby lowering their overall value, it provides a break to customers. Considering the skyrocketing utility rates we’ve come to expect over the last several months, any relief we can provide to residents ought to be welcome.

And just because selling the RECs means Pennsylvania couldn’t “claim” the reduced emissions for itself doesn’t mean carbon pollution wasn’t lessened overall. It doesn’t negate the very existence of the seven solar arrays built to satisfy the PULSE agreement.

The mental gymnastics this administration engages in just to oppose a Republican-authored plan does a great disservice to our residents, our environment and our economy. It’s standard operating procedure for Gov. Wolf and his allies, unfortunately.

We all agree that capping abandoned wells conveys numerous health and public safety benefits. But the problem requires a multi-billion dollar solution and it’s not prudent to fall back on the federal government alone to fix it.

There’s no reason we can’t and shouldn’t leverage these credits to help fill the gap. Choosing not to sell the credits leaves millions of dollars on the table. It is, quite simply, a winning lottery ticket the state refuses to cash. 

Senator Gene Yaw was elected to represent the 23rd Senatorial District consisting of Bradford, Lycoming, Sullivan, Union counties and a portion of Susquehanna County. He serves as chairman of the Senate Environmental Resources and Energy Committee.

CONTACT: Nick Troutman, Chief of Staff, 717-787-3280

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