We should count ourselves lucky to live in a state that has so much to offer. Not only is California known for its rich and vast environmental heritage, it also currently ranks as the 9th largest economy in the world, fostering innovation and serving as the backdrop for countless entrepreneurial success stories. Our Golden State is literally the land of opportunity, diversity, and hope. While much work remains, California’s economic recovery is in full swing.
Critical to that recovery, and central to the California’s economic strength, is access to energy. Businesses, local communities, workers, and families all require reliable energy sources to fuel industry, commerce, innovation, education, and our individual livelihoods.
Indeed, California’s petroleum industry keeps the more than 35 million registered vehicles moving up and down this state. And the benefits do not stop there. Jet fuel produced within the state keeps our world-class airports open for business. Natural gas in California has contributed to the nationwide shift from coal-burning resources that has led to the lowest national GHG emissions levels since 1994. But the news gets even better.
With the discovery of new oil resources in the San Joaquin Valley’s Monterey Shale Formation – more than 15.4 billion gallons of oil – Californians can expect greater energy security, some 200,000 new local jobs, and billions in new local and state tax revenue for years to come. Together, we consume 43 million gallons of gasoline and 13 million gallons of diesel fuel every day. Only the United States as a whole and China consume more. The oil from which that fuel is made is either going to be produced here in California – under rigid environmental controls – or it will be produced somewhere else and brought to our shores in tankers.
Governor Brown and his Administration understand the need to develop California’s native energy resources. They demonstrated this by signing Senate Bill 4 and proposing new hydraulic fracturing regulations. The desire to implement these regulations and begin the work of developing the Monterey Shale is clear, and is an important step for an industry that prides itself on being the safe and responsible driver of a world-leading economy.
However, the argument currently taking place about how to implement the new regulations offers and apply CEQA – the California Environmental Quality Act – to petroleum energy production and hydraulic fracturing offers a revealing glimpse into the many challenges the business community faces from California’s premier environmental law.
Individuals and organizations who believe that hydraulic fracturing should be banned in California now argue that CEQA’s onerous requirements should be applied to each and every well in California that utilizes hydraulic fracturing. This level of detailed study for every single use of the fracturing technology could amount to a moratorium on a significant amount of new energy production in California – something anti-hydraulic fracturing activists were unsuccessful getting in the Legislature.
This is a good example why CEQA needs to be reformed. CEQA can be and has been used by determined opponents to place roadblocks and impose delays on otherwise worthy development projects. In these instances, CEQA has little to do with protecting the environment and more to do with obstruction.
Let’s be clear. California’s new regulations on hydraulic fracturing impose the most stringent regulation of the technology in the country and possibly the world. It requires development of a CEQA-required environmental impact statement that will examine the environmental risks and hazards posed by fracturing and identify mitigation steps to address those risks. New regulations also impose a long list of other requirements before fracturing can take place.
It also is unfortunate that the enormous number of jobs and billions in tax revenue that could be generated should California’s oil-rich Monterey Shale resource prove to be accessible do not seem to carry much weight with hydraulic fracturing opponents. For a region that suffers from some of the worst poverty and unemployment in the nation, those 200,000 jobs are a ray of hope. Telling the citizens of the San Joaquin Valley to put this opportunity on hold while environmental groups pull all the available levers in their campaign to stop petroleum production ignores the human cost of emotion-driven activism.
We don’t expect these facts to end the debate over hydraulic fracturing. But the citizens of California can be confident we now have the experience, the tools and the regulations in place to move forward with safe and prudent domestic energy development and the undeniable economic benefits that go with it.