Agenda for MEC meeting, Tuesday, January 14, 2014

NORTH CAROLINA

MINING AND ENERGY COMMISSION

January 14, 2014

9:00 a.m.

Archdale Building Ground Floor Hearing Room

512 N. Salisbury St.

Raleigh, NC

To join the meeting:
https://denr.ncgovconnect.com/mec011414/

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Draft Minutes from December 6th

MEC Quarterly Report

Sign In Sheets

 AGENDA

1. Call to Order – James Womack, Chairman of the Mining and Energy Commission

2. Moment of Silence and Pledge of Allegiance

3. Welcome and Notice of NCGS 138A-15 – Chairman Womack

In accordance with the State Government Ethics Act, it is the duty of every member of the North Carolina Mining and Energy Commission to avoid conflicts of interest and potential conflicts. If any member knows of a conflict of interest or potential conflict with respect to matters coming before the Commission today, please identify the conflict or potential conflict at this time.

4. Roll Call of Commission Members – Chairman Womack

5. Approval of Minutes from Last Meeting – Chairman Womack

6. Committee Reports (10 minutes each, plus time for questions)

Administration of Oil & Gas Committee – Charles Holbrook

Rules Committee – Amy Pickle

7. Study Group Reports

Coordinated Permitting Study Group and Review of Study Group Report – Dr. Kenneth Taylor

Protection of Trade Secrets and Proprietary Information Study Group – Chairman Womack

8. Administration – Chairman Womack

Review of 2014 meeting schedule and proposed timelines

9. Overview of Proposed Revisions to the EMC’s Water Quality Rules – Evan Kane, DWR

10. Discussion & Action on Chemical Disclosure Rule, Chairman’s Mark – Chairman Womack

11. Lunch Break – 30 minutes

12. Discussion & Action on Setback Rule – George Howard

13. Public Comment

The public comment period will be limited to a total of 10 speakers and each speaker will be allowed three minutes to speak. The sign-up sheet will be available in the Ground Floor Hearing Room from 8:30 a.m. until 12:00 p.m.

14. Concluding Remarks

a. Commission Members

b. Commission Counsel

c. Commission Chairman

15. Adjournment

Reminder to All MEC Members: Members having a question about a conflict of interest or potential conflict should consult with the Chairman or with legal counsel.

Reminder to MEC Members Appointed by the Governor: Executive Order 34 mandates that in transacting Commission business each person appointed by the Governor shall act always in the best interest of the public without regard for his or her financial interests. To this end, each appointee must recuse himself or herself from voting on any matter on which the appointee has a financial interest.

Fracking, environmental justice in central PA, and its implications in NC

Lengthy story here about environmental justice in central Pennsylvania.

Barry Yeoman report on environmental justice in heavily-fracked central Pennsylvan

What I find revealing about this investigative piece from central Pennsylvania is something that Yeoman observes at the opening of the second page:

Few Places in the United States are tougher ground for building an environmental-justice movement than the Appalachian counties of central Pennsylvania—politically conservative, temperamentally reticent, and historically reliant on resource extraction. “We’re family-oriented. We’re white. We don’t bother people. We take care of our own,” [a local minister] told me.

The dispersed nature of fracking with the remote, isolated, small-scale industrial sites come with the promise of quick riches in mineral leases, changing the use of that land. The pride of taking care of our own leads to self-protective decisions, swayed by the gas man’s push to boost his bottom line, ensure painless and profitable access for the industry. The very residents sitting upon unproductive soils, a lost and contractually confining poultry industry offering loosing returns, and what seems like a budding American revival combine to turn a blind eye – a willful ignorance – to banking on the short-sighted hope of pulling the last drop of liquid from an already squeezed source while not investing in very real outputs to stretch our personal incomes and create real jobs and industry.

See my previous post about finding energy efficiency programs throughout the southeast, but these underlie the whole energy debate. Use less energy, diminish the demand for the supply, and utilities slow their push to extract every last drop of oil and gas. We can all play a role in reducing our consumption, while at the same time appreciating the developed economy in which we live that affords us the option.

On the bigger picture of jobs and industry, there is vast more opportunity to develop manufacturing facilities for wind and solar energy production here in North Carolina. In fact, North Carolina recently opened a manufacturing facility in Cleveland County for Schletter, a German company, to produce state-of-the-art photovoltaic panels and associate machinations for more efficient capture of solar energy. This facility has a workforce of around 300, I believe. Why chicken farmers are not leasing the rooftops of their chicken houses for solar panels to sell energy to utilities is beyond question. Dare I say that single-use commercial/agricultural facilities should be a thing of the past? Lee County is situated very well for manufacturing, especially in industry building for tomorrow’s economy. Its proximity to the Research Triangle and the growing markets of the state (and the whole southeast) is advantageous. For central North Carolina to get into the energy production industry solely through extracting natural gas is really selling its workforce and residents short. The long-term effect of fracking won’t burden the drillers or the utilities that purchase the gas, but it will linger in the community, both in the personal realm and in the civic and social infrastructures. Extraction of gas has not begun, but division is rampant: elected leaders have slandered their own constituents in the public square! This is a time for planning, and all stakeholders need to be at the table and respected in the process.

–BT

Workshop for landowners scheduled in Sanford, Dec. 14th

Just passing notice of this workshop for concerned landowners scheduled for December 14th at the McSwain Center in Sanford. The workshop is being organized by RAFI and the Southern Environmental Law Center. Click the link below for the official flyer for more information.

RAFI & SELC Landowner workshop flyer

Exploratory wells coming to… western NC?

A nice summary courtesy of Carolina Public Press of the report DENR Assistant Secretary Mitch Gillespie gave to the Environmental Review Commission of the General Assembly last week draws attention to a an unforeseen plan to explore areas in western NC for natural gas. The report included a list of feasibility studies for fracking, which I presume to mean exploratory wells for core samples, though the article does not specify what the studies will fully entail. The point that raised eyebrows was the identification of a feasibility study in western NC:

the list included a rare mention of a site in the mountain area, identified only as a “precambrian rift basin” in “western NC.”

I admit that I have not really studied the geology of North Carolina in more than 10 years, but considering those precambrian basins are more than 540 million years, those formations have not changed much. I cannot imagine that those precambrian basins are anything but crystalline rock, and though they may be porous, any gas that was there is probably cooked.

Presentation slides from Mitch Gillespie to NCGA Environmental Review Commission

Thanks to a commenter on the article, he points to a nugget of policy presented to the Environmental Review Commission that has a huge impact on local jurisdiction:

…municipalities will not be allowed to prohibit fracking within their boundaries.

There has been a lot of attention given to Colorado after several municipalities there voted earlier this month to ban fracking. Clearly, the legislation in North Carolina has preempted that option for local governments. The state does have that power as they are the body to recognize legal standing of municipalities and counties, but this prohibition on localities is heavy-handed.

–BT

Why I am opposed to Fracking in NC

I have done my best to keep this blog objective: neither for or against fracking. I try to present information as facts, and/or put information in context for the region, only occasionally expressing my opinion. Through this process, I have read and heard a lot of information regarding fracking, and I am at a point now where I must state that I believe hydraulic fracturing for natural gas in North Carolina should not occur.

The principle reason I oppose fracking is the forked-tongue attitude toward science displayed by the industry and policy-makers. I have mentioned several times on this blog that the technology of hydraulic fracturing is incredible – I am awestruck by the ability to drill thousands of feet beneath the surface, determine exactly which strata to turn the drill bit, and drill directionally along that specific bed of rock. That technology is only possible with advanced scientific knowledge. Industry executives assure the public that fracking is safe because of the fine-tuned technology and scientific expertise of the geologist on the drilling crew.

Then the same industry executives dismiss – and actively discredit – scientific data that documents water contamination linked to fracking. Science is not something which we can pick and choose, but can only enhance via additional study to better understand causes and effects. It is disrespectful and downright irresponsible for industry leaders, and policy-makers, to say in one sentence “trust the science” and in the very next sentence say “the science is flawed.”

Meanwhile, contempt for science has crept into the public, and unfortunately into public policy. The natural gas industry is happily playing along with this shift towards scientific illiteracy despite relying on highly trained and skilled scientists. Despite a growing solar industry here in NC, the state has backed off requirements for electric utilities to diversify their energy sources with renewable sources, and is clearly opening the state for fossil fuel extraction on land and offshore. The General Assembly has openly poo-pooed climate science and the data documenting human-impacted climate change, and this has produced extremely short-sighted legislation. The McCrory Administration has shown a similar contempt for science in the easing of regulations at the Department of Environment and Natural Resources, with its change in mission towards “customer” service. The public are the ultimate customers and should be outraged by this. Environmental regulations, which are developed with good scientific data on the environment’s capacity to dissipate hazards, present another area in which the natural gas industry has a forked tongue approach by demanding non-disclosure agreements and continued exemptions from the Safe Drinking Water Act and the Resources Conservation and Recovery Act: trust the science, doubt the science.

The broad shift towards natural gas has been a net win for carbon emissions over the past couple years, and natural industry leaders point to this success in citing Carbon emissions being their lowest since 1992. But then, many industry leaders fall in line with the climate-change deniers to block development of a more sustainable energy portfolio. Natural gas is still a fossil fuel, even if it does burn cleaner than coal and oil.

Furthermore, the issue of energy efficiency must be included in our energy plan, and is indeed something that can be done immediately should we have the collective will to not just fund but significantly expand weatherization programs. Too many homes across the state are using excess electricity to heat and cool the great outdoors through poorly insulated roofs and walls and leaky windows and doors – and note that these energy-gobbling homes are not confined to low-wealth communities.

A policy developed on willfully selective science simply cannot be trusted. I have discussed fracking with several people at various MEC study group meetings over the past several months, and I agree that there is a lot of land in western Lee County that is not valuable agriculturally. Shifting the land use from agricultural to industrial (which is what fracking on one’s property is) may be a good option for landowners to gain greater livelihood from their property. In my interactions with the MEC and its study group members, I admire the care and openness with which they have carried out their charge. But I must stand against fracking in North Carolina until we have a full scale strategy to address our long term needs and use our natural resources in the wisest manner possible: address energy efficiency first and foremost, develop regulations and a comprehensive energy plan based in the advanced scientific knowledge we have on energy demand, energy sources, and the risks associated with each of those sources.

-BT

Compulsory Pooling Study Group to discuss draft report, Aug 28

Note that the Compulsory Pooling Study Group will meet this Wednesday in Raleigh to discuss the draft report. The agenda is posted online and has a link to the draft report. Apologies for the lack of activity on here – not due to a lack of interest, but for being swamped with other pressing items.

-BT

Then again, Fracking may come soon anyway

A report this morning that the Governor himself has canceled a trip to Aspen in order to stick around for the end of the legislative session, and to personally push SB 127 with a provision in there to open fracking sooner than the compromised date of July 2015. Here’s the report from John Murawski in the N&O:

A complex fracking policy has unexpectedly emerged in the waning days of the state legislative session, giving rise to fears that lawmakers are making a last-ditch push to repeal North Carolina’s moratorium on shale gas exploration.

The move comes after a recent attempt to lift the moratorium failed to get past House lawmakers who said they intended to keep their pledge to citizens not to allow shale gas exploration until all safety regulations were in place.

But now the state House and Senate are poised to take up the complicated fracking bill that has not been reviewed by a committee or studied at length by lawmakers. The legislation, added into Senate Bill 127 which deals with changes to the Department of Commerce, surfaced Wednesday, the result of eleventh-hour negotiations with lawmakers and the environmental regulators who would oversee fracking here.

Gov. Pat McCrory unexpectedly visited the legislature for an hour on Wednesday and met with Republicans in a legislative strategy session. On his way out of the building, McCrory said he wanted to get an update on key legislation, adding: “I’m interested in energy. Energy development is what’s going to get us moving on the economy.”

The measure includes new provisions that would repeal a key feature in last year’s energy law that expressly prohibits issuing fracking permits to drilling companies until the N.C. Mining and Energy Commission writes safety rules and the legislature approves those rules. Instead of a prohibition, the bill says the state could issue drilling permits as of July 1, 2015, provided that fracking rules “have become effective.”

The chairman of the Mining and Energy Commission, James Womack, a Republican commissioner in Lee County, was surprised by the legislation.

“We didn’t know about it,” said Womack. “All it does is introduce confusion.”

Rep. Pricey Harrison, a Democratic from Guilford County, said the new language is an open door to issue permits by a specific date, whether the state is ready or not to oversee shale gas exploration.

“They continue to go back on their word,” Harrison said of Republican lawmakers who want to take steps to encourage the energy industry to drill here.

Rep. Mike Hager, a Rutherfordton Republican who has been active in the negotiations, said Senate Bill 127 would not undo the protections in the current law.

He acknowledged the bill may not come to a vote if it remains divisive among Republicans, but he’s confident his colleagues’ anxieties will by assuaged by the time the vote is scheduled Thursday. Hager said some Republicans are wary of last-minute legislation that alters the fracking bill passed last year. The bill, which passed by a single vote, contained explicit language to prohibit the issuance of fracking permits.

“Anything to do with fracking is going to be controversial,” he said. “We don’t want to create the appearance that we’re speeding this up, that we’re recklessly going into this.”

The most complex fracking parts in Senate Bill 127 relate to a severance tax program on the oil and gas industry, based on the grade and quantity of fossil fuel extracted. The money raised by taxing drilling operations would go to local governments, emergency funds and other uses.

Hager said the Mining and Energy Commission will also review severance taxes in the coming year, and the commission’s advice could help modify state law, but this legislation sets a direction.

“We want to attract business, so we don’t want to have the highest severance tax,” Hager said. He said bargain-basement taxes are also a bad idea but said North Carolina should have lower taxes as a matter of public policy.

Read more here: http://www.newsobserver.com/2013/07/25/3055638/last-minute-bill-raises-concern.html#storylink=cpy

SB 76, the compromised version, heads to the Governor

The compromised version of SB 76, aka the Fracking Bill, passed its final votes and now heads to the Governor. Here’s the write up from WRAL.com on the contents of the bill:

The final compromise version of Senate Bill 76 is far more modest than the original measure, which would have allowed fracking to move ahead March 1, 2015, without an additional vote by state lawmakers.

That provision is absent from the final measure, which reinstates the original requirement for legislative approval of the rules for fracking before permits can be issued and drilling can begin.

The Senate version also abolished the “landmen registry” for agents handling mineral rights leases for landowners, while the House version put the registry back in. In the final version, the state Mining and Energy Commission is directed to study the concept.

The final version still allows the secretary of the state Department of Environment and Natural Resources to replace the state geologist on the Mining and Energy Commission with another designee of his or her choice. It also removes requirements that commission appointees from the Environmental Resources Commission and Commission for Public Health have respective expertise in water and air resources and waste management.

it also still creates an Energy Policy Council and puts new emphasis on offshore oil and gas exploration.

The compromise, which was closer to the House’s version of the bill overall, won approval in the House with little debate Monday by a vote of 70-40.

The Senate followed suit Tuesday, albeit with less enthusiasm.

“We did the best we could,” said Sen. Buck Newton, R-Wilson, the bill’s original Senate sponsor. “The House didn’t want to go along with some of the improvements we wanted to make.

“It’s a small step forward. It’s not quite as far as we wanted to go, but it’s the best we could do.”

No one spoke against the measure in the Senate. The vote was 37-11.

North Carolina’s regulators trying to do their job, impeded by General Assembly

A nice “tip of the hat” to the process that the MEC is making to do what they’ve been charged to do in the face of powerful legislative elements charging forward despite them. Yes, this piece has plenty of opinion in it, but it provides a nice perspective and is well worth reading. Personally, I want to acknowledge the openness that the MEC has endeavored to honor with public participation. I also acknowledge I am way behind on writing on on-goings with the issue, which I hope to jump back into in the near future.

-BT

Bending protocol: passing bills without the votes

This is an update on House Bill 298, the “Affordable and Reliable Energy Act,” which I wrote about in an earlier post. I hope you’ve heard the news, but Rep. Hager’s sponsored bill failed to pass the committee by a 18-13 vote. Not to be daunted by the will of democratically elected representatives pushing to preserve emerging industries in their districts, Hager brought the bill back. Trick is, this time the vote was vocal. The minority supporting the bill yelled more loudly. No need to actually count votes anymore.

Again, apologies for being MIA the past two months. My schedule will be more flexible now, and I have some topics to post, including the idea of deep well injection, and the re-writing of the disclosure rule… at the simple behest of Halliburton. As the editorial staff of the Fayetteville Observer put it in their “Weekly Wrap” in which they give merits and demerits to news makers:

Demerit: For the N.C. Mining and Energy Commission, which abruptly withdrew a proposed rule requiring disclosure of chemicals used in hydraulic fracturing. The measure was withdrawn at the request of industry giant Halliburton, which says the regulation would force the disclosure of trade secrets.

The commission vowed transparency in its operations and protection for the state’s people and environment as it develops rules for fracking. But the first time a big energy company complains, it bows down and obeys. This does not bode well.