DV Journal

Pennsylvania’s tax on natural gas development generated $234 million in 2021, marking the second-largest amount ever returned to communities across the commonwealth, the Pennsylvania Public Utility Commission (PUC) said Friday.

The natural gas impact fee has generated $2.2 billion in the last decade.

Most of the money goes to county and local governments, however some state agencies also receive funds. The money funds infrastructure, emergency response and environmental programs.

“Generating $2.3 billion in essential funding for state and local governments across all 67 counties, Pennsylvania’s unique natural gas tax is an effective policy that yields impactful results,” Marcellus Shale Coalition president David Callahan said.

Some $234.4 million will be distributed to the state and counties in 2022, with all 67 counties receiving an allotment.

“The nearly 60 percent increase in this year’s distribution is directly related to heightened activity levels and the commodity price environment, underscoring the importance of policies that encourage domestic natural gas development, transportation and use. Our members continue to be focused on responsibly developing clean, abundant Pennsylvania natural gas, which is even more important today in keeping America and our allies’ energy secure,” Callahan said.

American Petroleum Institute Pennsylvania (API PA) Executive Director Stephanie Catarino Wissman said, “Every corner of the commonwealth has directly benefitted from Pennsylvania’s impact fee. This tax on natural gas wells has generated new revenue – totaling more than $2.2 billion over the past decade – for a wide variety of environmental, conservation, infrastructure, public safety and recreation projects. The report shows how natural gas production in Pennsylvania provides hundreds of millions annually in essential revenue while strengthening our economy.”

The impact fee revenue depends on the average annual price of natural gas on the New York Mercantile Exchange (NYMEX), which increased in 2021 compared to 2020, when the demand for natural gas declined due to the COVID-19 pandemic and a mild winter. Impact tax revenue reached $234 million in 2021, nearly 60 percent more than 2020, one of the highest collections since the impact tax was imposed ten years ago.

“As the demand for energy rebounds, policy certainty and long-term energy solutions are needed to help ensure that Americans have access to affordable and reliable energy,” said Wissman. “Pennsylvania’s abundant shale gas presents a unique opportunity to bolster domestic supply while funding critical infrastructure and environmental programs across the state, even in areas without natural gas development.”

This announcement comes when energy companies are under attack by the Biden administration over “excess” profits, a charge that economists dismiss.

Biden took steps to hamstring the energy companies at the onset of his administration, blocking the Keystone XL pipeline and signed executive orders to halt new oil and gas leases on public land, favoring green energy alternatives.

“Getting on a plane right now to go meet with a murderer to talk about the Saudis picking up their production, or writing a letter to the CEOs of Chevron and Exxon to say ‘super-duper large profits won’t be tolerated’ is simply inexcusable,” said economist David L. Bahnsen about Biden’s energy policy.

And while Biden has blamed high gasoline prices on Russian President Putin and the war in Ukraine, he recently pivoted to blame oil companies. But gasoline prices were at an average of $2.27 a gallon nationwide on Jan. 20, 2021 when Biden took office. On Jan. 3, a month before Putin invaded Ukraine, the national average gas price stood at $3.28 a gallon and as of Friday, the average price was $5 a gallon.

And it’s not just Biden.

Congresswoman Madeleine Dean (D-Montgomery) tweeted in March: “The price of crude oil is falling, and that should be reflected at the pump. We must be certain that energy companies are not using an unjust war to profit and price gouge.”

And in a let them eat cake moment, Transportation Secretary Pete Buttigieg said families who buy electric vehicles “never have to worry about gas prices again.”

Meanwhile, the sale price for an EV, on average, was $60,054 in February. That compared to $45,596 on average for all new vehicles, including electric ones, according to data from Edmonds.

Also, there’s the convenience factor. On a recent road trip, a Wall Street Journal reporter said she spent more time charging her rented EV than sleeping.

In a tweet that sums the situation up, Rep. Jim Jordan (R-Ohio) said, “The United States is blowing through its strategic oil reserves faster than expected. Gas is $5 a gallon nationally. And Joe Biden STILL refuses to drill domestically.”

The National Republican Senatorial Committee is making political hay for the 2022 midterms out of the high gas prices. They’re airing a new commercial targeting Democratic Nevada Sen. Catherine Cortez Masto and Democrat John Fetterman, who is running for the Senate, linking them to Biden and the high gas prices.

The ad says Fetterman backs Biden and the Green New Deal.

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Pennslyvania State Treasurer Stacy Garrity joined 26 fellow state financial officers in a letter to President Joe Biden urging him to “implement policies to promote American energy production.”

The letter was organized by the State Financial Officer Foundation (SFOF), a group of Republican state auditors and treasurers whose mission is to “drive sound fiscal policy.”

The missive, signed by financial officers from Alaska to Florida, calls energy “a critical component of every business and service provided in our economy as well as foundational to every American’s quality of life. As energy costs rise, its impact is felt throughout society. Businesses experience increased costs, which must often be passed onto consumers, while many Americans are forced to decide between various necessities of life, simply to keep the lights on and their vehicles powered.”

Energy production and its fiscal impact are particularly important in Pennsylvania, the nation’s second-largest producer of natural gas. Revenue from Pennsylvania’s natural gas tax is expected to hit $233 million this year, a near-record level.

“The current economic climate, amplified by the Russian invasion of Ukraine, requires immediate action at the national level,” Garrity said in a statement. “Hardworking families everywhere are paying more to keep food on the table and paying too much at the gas pumps. Our current federal policies are making the problem even worse.”

The SFOF letter pushed back on the Biden administration’s suggestion that electric vehicles are the solution to high energy prices.

“Instead of asking Americans to purchase electric vehicles—which is simply not an option for a great number of American families—government leaders should eliminate barriers to and expand development of these critical resources, bringing down the price of gas at the pump,” they wrote. “SFOF state leaders urge you to support traditional energy industries in their desire to ramp up production in the U.S. by providing certainty on oil and natural gas leasing by compelling the Department of Interior (DOI) to meet deadlines and honor its obligation to lease on federal lands and waters.”

Garrity agreed.

“America has abundant natural resources right under our own feet,” she said. “The Biden administration should be doing all it can to support efforts to harness these materials to achieve energy independence, instead of backing policies that make us more dependent on other nations. Investing in our own reliable energy sources is an investment in American families, and imperative to our national security.”

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Access to affordable, clean and reliable energy is at the center of the crises unfolding across Europe and the events leading up to Russia’s unprovoked invasion of Ukraine.

For far too long, Russia’s leadership has weaponized their energy resources, inflicting pain on regional nations to gain political and economic influence. These vulnerabilities have been exacerbated by unrealistic policies focused on a rapid transition to renewable energy.

Given the urgency to support our European allies and the brave people of Ukraine, we must act swiftly to put in place mechanisms to combat Russia’s aggression – including leveraging America’s abundant natural gas resources.

Our European allies, who have become reliant on Russia for more than 40 percent of their natural gas due to short-sighted policy decisions, are facing supply shortages and reliability challenges which, together, are causing deep economic pain to the region. In fact, natural gas prices in Europe broke record highs this week. This dependency not only de-stabilizes Europe, but it directly funds Russia’s the war machine.

As the world’s largest producer and exporter of natural gas, America – and Pennsylvania in particular – is uniquely positioned to do even more to support our allies and their efforts to counter Russia’s hostility. We are fortunate to have such abundant resources that can meet domestic consumer demand and aid European allies.

Some progress is starting to take place in earnest. Germany, for example, is advancing infrastructure investments to enhance natural gas trade and imports from allied nations in order to weaken Russia’s grip on their energy and economic security – yet much more can and must be done, and the U.S. is well-positioned to lead.

Here at home, export facilities along the East and Gulf Coasts are shipping record levels of LNG to Europe, helping our allies access the world’s most responsibly produced natural gas. Currently, more than half of American LNG exports are Europe-bound – but we can do more.

The strength of America’s shale revolution has created the ability for us to act swiftly to help our European allies while improving the global environment and our overall energy security. This is a proven fact. Consider, other strategic U.S. allies with few natural resources of their own – such as Japan and South Korea – have been top recipients of clean U.S. LNG for the past several years. Our support has helped these countries shore up their own energy security while advancing our own national security here at home.

From a policy perspective, elected officials must prioritize solutions that boost the security of our allies as well as the climate benefits inherent to domestic natural gas. This means de-bottlenecking approvals for necessary infrastructure and working collaboratively to reduce obstacles to maximizing the development and deployment of our natural gas resources. With the right level of commitment from policymakers, we’ll make certain Russia’s ability to inflict pain is short-lived.

In fact, recent polling shows nearly three-quarters of Americans – on both sides of the political spectrum –believe natural gas should be part of our country’s energy policies.

And there’s no debate that American natural gas is the world’s cleanest and most strongly regulated. As an example, the Clean Air Task Force notes that Russian natural gas has a 65 percent higher methane intensity rate compared to ours. Furthermore, Appalachia-produced natural gas has lowest methane intensity across the entire U.S.

Some question whether America has the political will to make the right policy decisions to prioritize modern energy infrastructure. We don’t need to look to Europe as an example of how short-sighted policy has negative consequences, we need only look to New England, where state politicians have banned critical pipeline infrastructure, resulting in significant economic hardship for consumers. Their policies have directly led to a growing dependence on importing foreign natural gas – including, just a few years ago, from Russia.

Pennsylvania’s clean, abundant natural gas resources cannot alone solve Europe’s energy crisis or Russia’s malicious aggression toward allies. However, our energy resources can assist the long-term needs of Americans and our allies, providing stability to global energy markets all while improving our global environment.

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Russian President Vladimir Putin has plunged Europe into crisis with his invasion of Ukraine. His stated goals are to destabilize the country to bring the nation back under Russia’s control. In response, it’s time we hit Putin where he knows it will hurt – through the energy sector. Unfortunately, there’s been a raft of bad policy decisions at the state and federal levels that need to be reversed to make this happen.

The United States and the European Union are discussing economic sanctions against Russia for its violations of international order. But at the same time, due to a lack of pipeline infrastructure and regulatory pressure to reduce domestic production from the Biden administration, the U.S. has dramatically increased the volume of imported Russian oil. Federal energy regulators note that in 2021, imports of Russian oil doubled year-over-yearto the highest level in a decade. Russia is now, unfathomably, the second-highest exporter of oil to the United States. Oil is by far Russia’s biggest and most profitable export – and it’s time to shut that off. In the meantime, America and its neighbors in Canada and Mexico have abundant supplies of oil to replace this resource. But we need leadership in Washington.

Instead, due to litigation from environmental groups, exploration of new resources on federal lands has stalled. Just days ago, the Biden administration announced it was pausing any new drilling on federal lands. At the same time, federal officials have revoked the permit for the Keystone XL pipeline, which would have brought in much-needed energy from our biggest trading partner, Canada. The Biden administration has also waffled on whether or not to oppose Michigan Governor Gretchen Whitmer’s attempts to vacate another critical pipeline, Line 5, which brings in oil that supplies the Great Lakes region, including to the Pittsburgh Airport.

Shutting down Russian imports in exchange for North American energy wouldn’t just hurt Russia – it would be a net win for the environment. Russian energy production is notoriously lax on environmental standards, with Biden’s Energy Secretary Jennifer Granholm going so far to say their production is “the dirtiest on earth,” with fugitive emission rates orders of magnitude above US standards. Despite this, Russia has been granted permission under the Paris climate accords to increase its greenhouse gas emissions by a whopping 34% by the end of the decade. In contrast, America and Canada have among the most stringent production standards globally – not to mention that the United States has led the developed world in reducing greenhouse gas emissions over the past two decades.

Pennsylvania has helped the United States achieve those reductions through its competitive markets and leadership production in shale gas. Our state is now the number two producer of natural gas and the leader in energy exports to other states. Unfortunately, neighboring states like New York and New Jersey have blocked new pipeline construction, to the applause of environmental groups. The result? Power prices and emissions have skyrocketed, and New England has infamously imported Russian gas into its terminal near Boston to keep the lights on in the winter. New England has also had to turn to fuel oil to prevent blackouts, resulting in a 44% increase in greenhouse gas emissions this past winter.

There are economic consequences to shutting down pipelines. Look no further than Germany announcing this week it is suspending the operating permit for the Nord Stream 2 pipeline that would have imported Russian gas into Europe, in response to Putin’s aggression. As European foreign policy analyst Bruno Macaes once said, pipelines are the continuation of war by other means. Yet Pennsylvania has been hamstrung in its ability to deliver reliable energy to its neighbors and abroad. We have enough natural gas to grow markets here (and reduce emissions) while also exporting more clean-burning fuel to allies in Europe, India and Asia. But the Biden administration has not greenlit any new LNG export or pipeline infrastructure. Domestic LNG cargoes are also forbidden, by the perverse consequences of the protectionist Jones Act, from being delivered to other domestic ports – meaning we can export LNG from Houston and the Gulf for $4.50 per million cubic feet but New England has to import it from much more emissions-intensive locales – like Russia – for seven times more.

Let there be no doubt – private industry in the United States is deploying billions of dollars into low- and zero-carbon energy technologies every year as they execute sustainability plans. In the meantime, there is a great and growing international demand for fossil fuels. Putin knows responsibly produced North American energy reduce revenues for his war machine. That’s why he said in 2013 that shale is a danger and must be stopped, and why NATO Secretary General Rasmussen announced in 2014the defense consortium had intelligence Putin was funding anti-fossil fuel environmental groups (which Hillary Clinton herself confirmed in the run-up to the 2016 election).

Putin’s aggression cannot be left unchecked. To help keep the peace and to build a more sustainable global future, America’s prolific energy resources must be leveraged to the maximum. We can no longer afford state and federal energy policy that accommodates and enriches Russia.

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David McCormick, Carla Sands, and Dr. Mehmet Oz may have been gone during the Republican U.S. Senate debate Monday evening, but they were not forgotten.

The three candidates skipped the event, and their opponents called them out for it again and again.

“We have political tourists running in this race. Mehmet Oz and Dave McCormick do not know this state, they couldn’t be bothered to show up tonight and they don’t care about you,” said Montgomery County developer Jeff Bartos.

“I didn’t parachute into Pennsylvania to run for office,” said Bartos. “I’m a lifelong resident with a deep love for our commonwealth. You cannot save Main Street if you can’t find Main Street. And as we saw tonight, my out-of-state opponents don’t even care to try to find it.”

Kathy Barnette, George Bochetto, Everett Stern, and Jeff Bartos. (photo by Maria Andraos)

Huntington Valley resident Kathy Barnette, an author, and Fox News commentator said it was the second debate Oz and McCormick spurned.

“Jeff has thrown out a lot of punches on Dave McCormick and Mehmet Oz, and it is warranted. It is such an insult that this is the second debate and they refuse to come before the American people, and specifically Pennsylvanians.”

On a different topic, Barnette said, “We need to focus on the economy and not just welfare checks or stimulus checks to keep people floating by.”

Along with cutting taxes and deregulating, “We need to begin to stabilize the U.S. dollar. That creates job growth and a rising tide lifts all boats,” she said.

“Students follow jobs,” said candidate George Bochetto, a Philadelphia lawyer. “And in order to keep students in this area, we need to provide good jobs, attract good jobs, provide the environment that businesses want to invest in. Right now the current leadership we have in Pittsburgh and Philadelphia, with Democrat-run cities that are chasing away our businesses, the students will (go) away with them. So if we want these students here, we have to get them the best jobs imaginable and we have to invest in our communities and our businesses that will provide those jobs.”

And then there was relatively unknown candidate Everett Stern, who attacked his fellow Republicans — particularly Barnette — for supporting former President Donald Trump. He said Barnette should personally apologize for the January 6 riot at the U.S. Capitol.

The audience booed Stern, an investigator and Chester County resident.

Jeff Bartos greets people after the debate.

“My mission is to absolutely make sure that a right-wing candidate backed by either Trump or Gen. [Michael] Flynn, does not get into office. And that means if I have to take down any of these candidates, to make sure I bring the moderates with me and a Democrat wins, so be it,” Stern said.

A hot topic for the Republicans on stage was inflation hitting gas prices and grocery store shelves.

Bochetto said inflation does not hurt rich people or those who are not paying taxes but takes a toll on the middle and working classes.

“But the handling of the COVID pandemic, the giveaways and the printing of money that has taken place, that is the terrible policy President Biden implemented on day one when he took office, which was to close down our development of natural gas in the United States of America…to force this country to start begging OPEC for oil and oil supplies, and they’re driving up the prices,” Bochetto said.  “And what’s driving up inflation? Go to the gas station. Fill your car up. See how much more it takes. That’s what’s driving inflation.”

Bartos said that during the pandemic he started a nonprofit and raised $3.5 million to help small businesses after he saw people “being crushed by a government that did not care.”

George Bochetto

“Then Biden administration comes in and put in policies that raise inflation…that have crushed, crushed the restaurants and small businesses that already operate on a razor-thin margin. We need to go back to the policies that were working just two short years ago,” said Bartos.

Asked about the state’s energy sector, Bartos said he would be a senator who “fights for Pennsylvania’s energy industry.”

“What we’re seeing today in Ukraine and Russia is the direct result of the Biden administration’s terribly flawed, failed policies from day one to enable Russia to finish the Nord Stream pipeline that will allow Putin to ship his natural gas and resources to Germany. Tomorrow, Pennsylvania gas should be on LNG tankers on its way to ship to Europe to help America’s allies. We need to shut off all pipelines and all energy transfers outside of Russian borders and we should cut Russia off. And we should put Putin right back where he belongs, which is in his a country, a gas station with an army.”

“Pennsylvania’s natural resources are a key national security asset of the United States,” Bartos added.

Barnette would write legislation to remove the Biden administration’s restrictions on drilling and to reopen the Keystone pipeline. Having a strong domestic oil and gas production “allows us to remain strong and put a check on bullies all across the world,” she said.

Kathy Barnette talks to students after the debate.

“There’s no question we’re sitting on a Saudi Arabia of natural gas, Marcellus Shale,” said Bochetto. “Developing that and fracking is key…But what really has to happen to turn it around is to invest…get it to Philadelphia, get it to New Jersey, get it to the coastline where we can then export. And the only one meaningful way to get it there and that’s through pipelines.”

Broad and Liberty, the Pennsylvania Chamber of Business and Industry, the Keystone Free Enterprise Fund and GOP SuperPAC LV Strong sponsored the debate.

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Earlier this month, Peco’s parent Exelon Corp. completed its split into two companies, putting the Limerick nuclear power plant under its new Constellation brand while keeping Peco and its other utility companies part of Exelon.

Other than a new logo, which Peco rolled out a few weeks ago with a flashy video presentation, what will the changes mean to local ratepayers in the Delaware Valley?

Industry experts say to expect few changes.

“While Peco’s appearance will change over time, we want to ensure our customers know that we are committed to being the trusted energy partner they’ve known for years, and our dedication to the communities we serve will only grow stronger,” said president and CEO Mike Innocenzo. “Our purpose of powering a cleaner and brighter future for our customers and communities remains unchanged, and we’ll continue our efforts to enhance reliability and the customer experience and further our commitment to our communities and to a cleaner energy future.”

Founded in 1881, PECO is Pennsylvania’s largest electric and natural gas utility. With headquarters in Philadelphia, Peco delivers energy to more than 1.6 million electric customers and more than half a million natural gas customers in southeastern Pennsylvania.

According to Terrance J. Fitzpatrick, President and CEO of the Energy Association of Pennsylvania, Exelon’s move is part of a “trend in the industry for 20 years to separate the transmission and distribution business from the generation business into separate companies. In fact, Peco/Exelon is the last electric utility in Pennsylvania to do so.”

And what about rates?

“Separating our companies will not change rates for customers,” Peco said in a statement. Fitzpatrick agrees.

“It doesn’t seem to me that the corporate separation should raise concern for consumers,” Fitzpatrick said. “Customers can choose to purchase supplies of electricity or gas from competitive suppliers or they can choose the supply option of the utilities. The manner that electric and gas utilities buy supplies in wholesale markets for their customers who choose to buy from them is overseen by the Pennsylvania Public Utility Commission (PUC). The utilities do not make a profit on these sales—they simply pass along the cost to customers.”

David N. Taylor, President and CEO of the Pennsylvania Manufacturers’ Association, says it’s up to the PUC to ensure ratepayers are protected.

“One of the great accomplishments of the [Republican Gov. Tom] Ridge administration was transitioning Pennsylvania from being a regulated market for electricity to being a competitive market,” Taylor said. “As part of that, Pennsylvania went through a long and very expensive transition process. Part of that was you had nuclear power plants that were governed as utilities to say, ‘Look, our business model is predicated on the PUC approving future rate increases which made all these capital investments that we need to be able to recoup, that it’s not right for the commonwealth to go and pull the rug out from under us.'”

The people who were proposing the shift to competitive markets agreed, and during the transition, nuclear power generators were allowed to impose a surcharge on customers totaling $9 billion.

“That was a price that Pennsylvanians paid to get competitive markets,” says Taylor. “The nukes wanted competitive markets, they lobbied for it because they thought they were going to inherit the earth as the low-cost baseload provider, but this was before the Marcellus Shale was discovered and developed. And so the nuclear companies took all that money and apparently just pocketed it or gave it to the shareholders. They didn’t do anything to prepare for competition, and then market conditions changed.”

As a result, Exelon reversed its position, Taylor said.

“You had Exelon, which is the owner of several nuclear power plants, working against competitive markets, and by the way, they were going to keep the $9 billion.”

As someone representing the manufacturing sector and large industrial energy consumers, Taylor says they were “deeply displeased.”

Today, competitive markets will continue to protect consumers by applying downward pressure on prices.

“Any changes to Peco rates will follow the standard process for regulatory rate reviews, which follow PUC guidelines, and include comprehensive input from customers and stakeholders,” the company said.

“This is an important milestone in Exelon’s history,” Christopher M. Crane, president and CEO of Exelon, said in a statement. “With the successful completion of our separation, we step forward in a strong position to serve customer needs, drive growth and social equity in the communities we serve and deliver sustainable value as our industry continues to evolve.”

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Joe Biden kicked off his presidency on January 20, 2021, by killing the Keystone XL pipeline. For the newly-elected Democrat, it was a message affirming his commitment to green energy policies.

For the energy industry, America’s allies abroad, and skilled workers at home, however, the impacts of Biden’s actions were far more concrete.

“Killing 10,000 jobs and taking $2.2 billion in payroll out of workers’ pockets is not what Americans need or want right now,” Andy Black, President and CEO of the Association of Oil Pipelines, said at the time.

The Laborers’ International Union of North America (LiUNA) called Biden’s decision “both insulting and disappointing to the thousands of hard-working members who will lose good-paying, middle-class family-supporting jobs.

“By blocking this 100 percent union project, and pandering to environmental extremists, a thousand union jobs will immediately vanish and 10,000 additional jobs will be foregone,” the group added.

That was a year ago. How does the decision to end the Keystone pipeline look today?

First, there are the immediate economic impacts. Six months after Biden’s decision, TC Energy pulled the plug on the pipeline, which would have shipped 500,000 barrels a day from Western Canada into the U.S. refining system. Given America’s annual production of 16.5 million barrels a day in 2020, that was not a major loss at the time.

But today, domestic energy supplies are strained and global demand is soaring. U.S. allies in Europe are struggling to meet demand in the winter of 2022. Circumstances are very different from the day Biden blocked Keystone.

“Biden’s hurt us,” says H. Sterling Burnett, Ph.D., Senior Fellow on Environmental Policy for the Illinois-based Heartland Institute. “There’s no question about that.”

Neal Crabtree, a welding foreman from Fouke, Ark., lost his job when Biden pulled the pipeline’s permit. But he says he has bigger concerns than his own paycheck.

“I was worried by the tone being set by the Biden administration,” Crabtree said. “A direct attack on energy in this country seemed to be the president’s highest priority.

“Now we’re seeing rising energy prices. Private companies are reluctant to develop new pipelines because of the outrageous permitting process. Pipelines, just like roads and bridges in this country, are aging. To neglect our pipelines is a dangerous thing. We saw how dependent we are on them when the Colonial Pipeline was shut down last year.”

Dan Kish, Distinguished Senior Fellow for the Washington, D.C.-based Institute for Energy Research, agrees. “We saw it as a body blow to American energy security,” he said.

And, some energy experts say, it is not just that Biden blocked a pipeline. He blocked Keystone, a project that went over and above to address issues like carbon emissions, safety standards, and cooperation with indigenous people impacted by the pipeline.

“When Biden shut down Keystone, which really was bending over backward to do everything right from the Democrats’ perspective — and Biden still killed it — that sent a message to the entire industry that it didn’t matter what you did, this administration wanted to shut you down,” said Dan K. Eberhart, CEO of Canary, one of the largest oilfield service companies in the country.

TC Energy had pledged to operate Keystone as a “net-zero emissions level,” the first of its kind commitment in the industry. And operating in Canada meant working under some of the most stringent environmental and safety regulations in the world.

The pipeline managers also had reached agreements with Native Americans as well, entering a $1 billion equity agreement with a group of five Alberta and Saskatchewan First Nations.

“I would say ‘President Biden, I do believe you made a bad decision putting Keystone on the backburner,’” said Saskatchewan First Nation Chief Alvin Francis just days after Biden’s decision. “This could change the outlook of all First Nations in Canada and the US.”

It has certainly changed the mood between Ontario and Washington, D.C. Keystone was in many ways primarily a Canadian project. Biden’s reversal on the pipeline, as well as proposed subsidies for U.S.- made electric vehicles, has heightened tensions between the two allies.

Closing Keystone has not strengthened America’s hand with its potential enemies, either. Biden has been left in the awkward position of lobbying Congress to keep the Nord Stream 2 pipeline open, even as Russian President Vladimir Putin continues threatening a possible invasion of Ukraine. And less oil from Canada and the U.S. on the global market means more demand for products from Russia, Libya, and Venezuela.

“This was a missed opportunity to increase North American energy security, lower costs for American consumers, and reduce dependence on foreign energy sources that are hostile to U.S. interests,” says Frank Macchiarola, Senior Vice President of Policy, Economics and Regulatory Affairs at American Petroleum Institute (API)

If Biden’s goal was to keep the oil in the ground, it didn’t work. Canadian oil production remained strong throughout 2021 and is expected to hit a new record in 2022, according to the International Energy Agency.

Is it possible Biden would reconsider Keystone XL, having just recently reached out to OPEC to increase production and help bring down gas prices? Burnett says that is unlikely.

“Biden is imposing methane regulations on the industry that the Trump administration decided were not necessary for public health and safety. Biden has agreed to block new natural gas pipelines and new natural gas power stations, so he’s helping create energy shortages in the U.S. and approving pipelines from Russia as opposed to shipping our gas,” Burnett said.

“Biden’s view seems to be ‘Energy is good for the world, but not for the United States,’” he added.

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If he becomes Pennsylvania governor, Lou Barletta says he will bus illegal immigrants to Delaware.

Barletta is taking a page out of Florida Gov. Ron DeSantis’ playbook in saying he would send migrants that the federal government has been flying throughout the country to President Joe Biden’s home state.

The Florida governor recently told Fox News he was considering responding to the Biden administration’s policy of flying migrants from the U.S. southern border to states like his by sending them on to Biden’s home state.

“Our view is that if they’re going to be dumping, we want to be able to facilitate transfer to places like Delaware. And so we have $8 million in my new budget to be able to do that,” DeSantis said.

Barletta, 65, who is polling ahead of the other 14 or so candidates running for the GOP voters’ nod in the May 2022 primary, first made national headlines with a no-nonsense attitude toward illegal immigrants when he was mayor of Hazleton. He says he likes what DeSantis is doing.

“We’re a lot closer to Delaware than Florida, and it will cost us all lot less money to ship people from Philadelphia to Wilmington than it will for DeSantis to ship them from Fort Lauderdale,” Barletta told the Delaware Valley Journal podcast on Wednesday.

Barletta said that he has stayed true to his principles “his whole political career” and always did what he thinks is right, “even if it’s not politically popular.”

“When I was mayor of Hazleton, I was the first mayor in the country to stand up against the illegal immigration because it was affecting our city,” said Barletta.

It’s a matter of fairness to Barletta.

“How many millions of (legal) immigrants who are waiting, have waited, have gone through the process, have paid the price (to) bring their families here legally,” said Barletta. “And, you know, they’re watching people just cross the border and getting the same benefits…which is unfair. It’s a case of unfairness, but everybody should care.”

Barletta, who also served in Congress and ran for the Senate against Democrat Bob Casey, said that his experience in government, coupled with his background as a small business owner, has prepared him to be governor.

Barletta promised to get the state’s economy back on track.

“I would open up our economy.” Pennsylvania “was blessed with all this energy under our feet,” he said. The commonwealth has as much mineral wealth as “an entire country.”

“That’s how much energy we have that we could be exporting, but also using it to bring manufacturing here, building pipelines, which will put people to work, having all this gas under our feet and not building a pipeline is like being in college and having a keg of beer without a tap.”

Barletta would also cut taxes and regulations to bring more businesses here.

“Pennsylvania’s not business-friendly,” said Barletta. The state has “the second-highest business taxes in the country” and “our regulatory agencies are used as weapons to punish businesses right now. The DEP (Department of Environmental Protection) stands for don’t expect permits.”

Asked about the Regional Greenhouse Gas Initiative (RGGI) that Wolf is entering Pennsylvania into without the legislature’s agreement, Barletta said, “Day one, I’m repealing RGGI.”

“It’s ludicrous that we would be a state with all this opportunity here. And we would put ourselves in a consortium of other states that could care less because they don’t have it. They don’t have the energy…that we have and our country needs this energy. Look at the price of gas…Pennsylvania can be a leader and we will be a leader, and that’s going to mean a lot more jobs and a lot more opportunities.”

So far the only Democrat running for governor is Attorney General Josh Shapiro.

Meanwhile, many of the Republican gubernatorial candidates will be in Carlisle on Jan. 5 for their first debate, although Barletta will not attend any debates until after the qualifying period to be on the May primary ballot.

Among those also running: Montgomery County Commissioner Joe Gale; former U.S. Attorney Bill McSwain; Jason Richey, a Pittsburgh attorney; Charlie Gerow, a political strategist based in Harrisburg; Guy Ciarrocchi, who is on leave as president of the Chester County Chamber of Business and Industry; Dave White, a former Delaware County councilman and small business owner; Senate President Pro Tempore Jake Corman, who lives in Centre County; Melissa Hart, a lawyer and former congresswoman from Allegheny County; and Lancaster state Sen. Scott Martin, who also owns a small business. State Sen. Doug Mastriano of Franklin County, is also expected to run.

If he does, Mastriano may compete with Barletta for voters who support former President Donald Trump. Barletta was the first congressman to support Trump when the former billionaire businessman and TV star began his quest for office. Mastriano is a strong advocate of Trump’s contention that he lost to Biden in 2020 because of a rigged election.

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Environmental activists call it a “methane fee.” The energy industry calls it a “natural gas tax.” Either way, Pennsylvania consumers are likely to feel the effects in their pocketbooks.

The U.S. House of Representatives is expected to vote this week on its version of the budget reconciliation bill — also known as the “Build Back Better” bill — which includes increased fees on methane emissions. Methane is a byproduct of oil and natural gas production, and as a result, the fee would be an increase in the cost of production.

Environmentalists say reducing methane is essential to the fight against climate change. At the COP26 meeting in Scotland last week, the United States announced it will participate in the Global Methane Pledge to cut methane emissions 30 percent by 2030.

“Methane has more than 80 times the warming power of carbon dioxide over the first 20 years after it reaches the atmosphere,” says Environmental Defense Fund (EDF) on its website. “Even though CO₂ has a longer-lasting effect, methane sets the pace for warming in the near term.”

As National Geographic reports, “Whereas carbon dioxide persists for centuries, most methane converts to carbon dioxide or gets cycled out of the atmosphere within about a decade.”

Meanwhile, two of the world’s biggest methane emitters — China nor Russia — refused to sign the Global Methane Pledge.

And energy producers point to America’s surging costs to heat their homes this winter and the wider inflation problem as evidence this is the wrong time to add costs to consumers’ utility bills.

“This is nothing more than a tax on natural gas at a time when policymakers should be focused on solutions that support affordable, reliable energy while reducing emissions,” says API Senior Vice President of Policy, Economics and Regulatory Affairs Frank Macchiarola.

“We must continue to drive down methane emissions without adding new burdens on American families and businesses,” added said Karen Harbert, President and CEO of the American Gas Association. “Our analysis indicates that the proposed tax could increase natural gas bills from 12 percent to 34 percent, depending on the variation of the proposal assessed.”

Sen. Joe Manchin, a Democrat representing natural-gas producing West Virginia, has been reluctant to support legislation with a tax or fee on methane. As a result, House Democrats have been trying to find ways to change the terminology and get Manchin’s blessing once the bill is approved in the House and sent to the Senate. Democrats’ have a razor-thin majority in both chambers and need the support of every Democrat in the Senate.

Winning over Manchin has not been, and will not be, easy.

“Major oil and gas companies are actively investing in, developing, and using new technologies to detect and repair leaks, which are known to be a public health risk and contribute to climate change,” Manchin said in August 2020.

Delaware Valley U.S. Reps. Madeleine Dean (D), Mary Gay Scanlon (D), and Brian Fitzpatrick (R) declined to respond to requests for comment about the upcoming Build Back Better bill vote.

Meanwhile, API’s Frank Macchiarola says methane is already being regulated.

“The direct regulation of methane by the EPA is the most impactful way to build on the downward trend of methane emission rates in key producing regions rather than a duplicative and punitive natural gas tax that would only hurt American consumers and undermine the economic recovery,” says Macchiarola.

Gordon Tomb, senior adviser to CO2 Coalition, does not see a need for the regulations.

“Methane makes up a minuscule portion of the atmosphere — less than two parts per million — and together with carbon dioxide contributes an estimated 0.012 degrees C a year — an amount too small to even measure,” says Tomb. “Regulating emissions of either gas has no basis in science and imposes an unnecessary burden on businesses and the people who buy their products.”

And, Tomb added, “When politicians are talking about regulating methane, they are usually talking about taxing methane that gets leaked to the environment during production operations, treating that methane as a pollutant,” says Tomb. “Of course, methane is put into the atmosphere from all kinds of sources, and in the scheme of things the amount in the atmosphere is quite small irrespective of where it is coming from.”

The Marcellus Shale Coalition has also warned that taxes or fees would be bad for everyone.

“Layering more taxes on strongly regulated domestic energy production increases costs for those who produce and rely on these essential resources, with low-and fixed-income families shouldering the disproportionate share of the tax hike,” the group wrote in a September letter that included the Gas & Oil Association of West Virginia and the Ohio Oil & Gas Association.

And while organizations including the Sierra Club say fossil fuel organizations do not care about the environment, Marcellus Shale Coalition begs to differ.

“Our members are fully committed to improving air quality and further reducing all emission sources, particularly methane since it is the very product we sell, through leveraging best available technologies and practices.”

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Pennsylvania was selected as the second of nine sites for a $6 billion plant that will turn natural gas and methane into gasoline.

At a recent press conference, state Sen. John Yudichak (I-Carbon/Luzerne) noted the plant will create about 3,500 construction jobs in Luzerne County with 400 permanent jobs once it opens. Yudichak, whose own family worked in the coal mining industry, said that the “grandsons and great-grandsons of these anthracite miners can now walk in new footsteps, footsteps that are going to reduce the carbon footprint of the transportation sector in our country and in our world. It is a revolutionary idea that you are presenting to the United States and to Pennsylvania. We can change the game on climate action, that we can have a responsible, sustainable climate change solution, and have good-paying energy jobs.”

The new plant has garnered bipartisan support, he said, including from Gov. Tom Wolf.

Thomas Tureen, chairman of the board of Nacero Inc., said the new plant will the tradition of people in the area of “mining” and ‘hard work” are critical to the success of the venture.

“This is a transformative environmental project that we’re undertaking,” said Tureen. The plant will turn natural gas and methane into gasoline. “Transportation is probably the most difficult sector to get at in terms of global warming. It is certainly one of our largest, roughly a quarter, of greenhouse gases come from this quarter and it’s very difficult to change it because we need those cars. Electrification is a wonderful idea but it’s going to take time.” He promised the facility, to be built on former mine land, will be very clean and ecologically sound.

“I want to emphasize that this is not refining,” he said. “This is a catalytic process, not a refining process. This process will cut the life cycle carbon footprint of gasoline roughly in half.

“Our fuel will have no sulfur,” Tureen added. “That will allow the catalytic converters in today’s cars and trucks to a better job in removing the precursors of ground-level ozone.”

They will also use methane that escapes from cattle and farming, he said. And the natural gas that the plant uses will be carried over existing pipelines.

Methane is “our most immediate climate problem,” according to the United Nations, he noted. Once all nine plants are online, methane in the atmosphere will be reduced by 22 percent, he said.

“We’re really excited to bring this,” he said. The technology is already in use in Turkmenistan.

U.S. Rep. Daniel Meuser (R-9th District) called the plan “incredible” and thanked Tureen for bringing the plant to northeastern Pennsylvania.

“The quality of life, the improvements this will bean for our area are immense,” said Meuser.  “This project will help transform Pennsylvania reclaiming hundreds of acres of mine-scarred land.”

Warren Faust, president of Northeast Pennsylvania Construction Trades Council, is excited that Nacero will add the 3,500 to 4,000 construction jobs to the area.

“It’s not just the investment of Nacero’s site here, turning natural gas to gasoline,” he said. “It’s the residual work. The whole community will be stronger because of their investment.”

“It’s a win-win for everybody,” said Faust.

Yudichak said they had put together a team to bring the plant to Pennsylvania, saying this development is “historic.” The industrial project is predicated on state Act 66, a tax credit for manufacturing and also federal tax credits for alternative fuels, said Yudichak.

“It’s been 50 years since the U.S. has built a new refinery,” said Tureen, but this is “brand new” technology and not a refinery. “We are very attuned to safety as we are to the environment,” said Tureen. The tanks have an automatic system to extinguish any fire in 90 seconds.  “We’re making a cleaner fuel, but we’re making it in a much cleaner manner, as well.”

“This is an anchor industry,” he continued. “It will underlie the community in the way only something this large and this reliable can.”

It will also create opportunities for students and young people, he said.

“Our approach to this runs up and down the scale,” he said. “The jobs, the steady employment, we’re estimating upwards of $100,000 a year for the operating jobs…that’s important to the community.”

Yudichak said a study that Houston-based Nacero commissioned for its Texas plant showed a $25 billion ripple effect across the economy. He predicted similar growth in northeastern Pennsylvania,

Tureen said Nacero’s technology will be the quickest way to get climate change under control. The plant will take four years to build, plus a year of planning but they could break ground as early as next year.

“Today’s announcement shows how we can bring these jobs back and breathe new life into our communities with responsible policies targeted toward creating family-sustaining jobs in Pennsylvania,” state Sen. Jake Corman, president pro tempore said in a press release.

The project was made possible by the Local Resource Manufacturing Tax Credit program, which was approved last July with the unanimous support of Senate Republicans. The program provides up to $6.7 million in tax credits for qualifying projects, Corman noted.

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