Jason Barton

Professional Information and Energy News

Regulating gas drilling & fracturing

without comments

Internalize the externalities. That’s the job of government in this situation. If there are external or indirect costs from drilling for natural gas, particularly with technologies such as hydraulic fracturing that involve greater risk, the companies performing the drilling, and people like us who then buy the finished product by lighting our homes, pay those costs.

For example, if the chemicals used in hydraulic fracturing leak into drinking water and make people sick, the economic costs such as hospital bills and lost work are paid by the company who was doing the drilling involved with the leak. Of course this doesn’t solve all the problems caused when people get sick from bad water, but it motivates the companies to prevent such accidents, as opposed to setting up government funds to fix them, which motivates neither prevention nor the guilty parties taking responsibility for their actions. Then, as these costs are passed along to we the consumers, we’re motivated to pay more attention to the companies that provide our electricity, further enforcing the cycle.

Yes, it may seem shallow or even vulgar to think about issues of human health only in monetary terms, but it presents a set of very efficient tools for solving so many of the problems that go much deeper than money.

PA senator says US should regulate gas drilling

August 20, 2010, 8:13AM ET

By MICHAEL RUBINKAM

SCRANTON, Pa.

U.S. Sen. Bob Casey said Thursday that Pennsylvania’s emerging natural gas industry has the potential to create jobs and wealth, but also carries environmental risks that must be addressed.

The Pennsylvania Democrat told a forum in Scranton that the “gas rush” taking place in the vast Marcellus Shale region of Pennsylvania “can create a great economic boost” in a state where nearly 600,000 people are unemployed. But he added: “We must not fail to protect our people, our land, our water and our future.”

Read the entire article here.