Tuesday, April 26, 2016

Economic and Environmental Implications of Fracking


The modern natural gas extraction process termed fracking has sparked a national debate in regards to economic and environmental impacts. This process has seen substantial growth over the past few years thanks to the combination of hydraulic fracturing and horizontal drilling that proliferates the amount of natural gas reserves that are able to be reached. Hydraulic fracturing (fracking) stimulates the formation of fractures within rock formations to encourage the flow of natural gas and oil to the surface. This is accomplished by injecting a fluid that contains water, sand, and chemicals down into the rock (The Process). Horizontal drilling turns a well horizontal at a certain depth. This allows companies to reach unconventional natural gas deposits much more easily. From 1998 until now, the combination of these two processes has led to a fracking boom in the US (Garmezy). Both economists and environmentalists take part in the fracking debate. Where environmentalists see danger, economists see another way to earn a buck.

Economically speaking, fracking provides the US with millions of jobs and a much needed energy source. Robert Blackwill and Meghan O’Sullivan write the following about fracking:

     Since 1971, when US oil production peaked, energy has been construed as                a strategic liability for the country, with its ever-growing thirst for reasonably          priced fossil fuels sometimes necessitating incongruous alliances and complex          obligations abroad," they write. "That logic has been upended, and the newly            unlocked energy is set to boost the US economy and grant Washington newfound    
leverage around the world (Usborne).

As a large and growing nation, the US is dependent upon oil supply, and currently, that is controlled by The Organization of the Petroleum Exporting Countries (Opec). But, because of this new practice of fracking, US oil independence is now a more likely reality–a reality economists place their focus on in effort to gain public support. In his article for The Independent, David Usborne writes,

     It's also power, and not in the combustion sense. Thanks to the success of                  engineers...in pushing the frontiers of hydraulic fracturing, or "fracking", to              access reserves of oil trapped in shale formations...America is poised to displace      Saudi Arabia as the world's top producer. With that could come a hobbling of            Opec and unforeseen shifts in US foreign policy (Usborne). 

Pulling the potential environmental dangers out of the equation, both parties can agree on the economic benefit there is to be had from fracking. But, environmental implications cannot be ignored. For a while now, fracking companies have profited from the newness of the practice. Many businessmen, and government officials were not aware of the potential dangers associated with fracking. But more recently, many components of the fracking process have been called into question by environmentalists. Environmentalists fear irrevocable contamination to groundwater supply, backflow fluids, greenhouse gas emission, and the impact on rural lands and resource reserves.

Taking a closer look at one of these consequences shows where the thinking of these two fields diverges. Vast amounts of rural land and habitats are being disrupted by fracking companies. The large machinery and trucks needed are not only damaging the land, but also rural infrastructure. The rural roads were not built to withstand numerous truckloads per day carrying heavy loads. The fracking industry justifies its presence, saying that fracking boosts these rural economies. Environmentalists fight back citing the negative aspects of fracking, particularly contaminated drinking water and seismic activity.

A conversation about fracking is not complete without a look at the policy governing this practice. Governmental legislature clearly showcases the disagreements that lace through this practice. Currently, the majority of fracking policy lies heavily in favor of the economic value of the practice at the expense of environment preservation. In 2005, Congress assessed the 1974 Safe Drinking Water Act and exempted fracking exercises from its stipulations. Many speculate this exemption stemmed from the EPA’s (Environmental Protection Agency) report that cited fracking as only a “minimal threat” to drinking water (Manuel). This study one looked at one type of drilling and did not directly monitor any wells that could plausibly be contaminated due to proximity to drilling sites. Others align more with the theory that fracking businesses are the ones who really pulled the strings.

When Bush took office in 2001, he quickly created the National Energy Policy Development Group, chaired by his Vice President, Dick Cheney. In light of fracking, this task force left a major loop hole in the legislature, commonly referred to as the Halliburton Loophole , that greatly benefits American business. Daniel Twomey writes, “This loophole eliminated-by legal fiat-the economic risks of fracking's environmental contamination and compromised individual rights to clean air and water for anyone living in or near fracking operations” (Twomey).

The increasing public awareness about fracking has initiated the generation of new policy. The FRAC act (Fracturing Responsibility and Awareness of Chemicals) was introduced to Congress in 2009. This act would further regulate fracking practices and require companies to disclose the chemicals they use. But, for unknown reasons, the legislation has yet to be decided upon. The disagreement between economists and environmentalists about what needs to be done regarding fracking is influencing congressmen and dividing the vote. This is stifling any immediate policy change.

Looking at economic value versus environmental concerns portrays an all too familiar picture of American business practices. At face value, fracking is a government-regulated practice that seeks to increase America’s energy independence. Digging deeper, it becomes evident that all of the policy in place greatly favors the expansion of the industry with no thought given to environmental harm, especially long term damage. Rosenberg writes,

Despite the rapid pace of development of unconventional oil and gas resources enabled by fracking across the United States, and its influence on domestic and international energy markets, there is remarkably little independent information available to the public on the effects, both positive and negative, of such an undertaking (Rosenberg).

Economists and environmentalists are quick to agree upon the usefulness of fracking, but the simplicity stops there. Environmentalists protest the practice, saying that in the long run fracking will lead to more environmental problems than economic good. Economists view the earth as a resource that is available to capitalize on, even if the capitalization produces a few residual side effects. Overall, the untested nature of the fracking industry may be producing serious and harmful long term environmental effects, all because of splotchy legislation that places economic success above public well-being. Until further research is completed, these two parties will remain divisive, therefore creating legislature that fails to fully appease either side.


Works Cited

Garmezy, Adam. “Balancing Hydraulic Fracturing"s Environmental and Economic             Impacts: The Need for a Comprehensive Federal Baseline and the Provision of           Local Rights.” Duke Environmental Law & Policy Forum 23.2 (2013): 405–439.           Print.

Jackson, Robert et al. "The Environmental Costs and Benefits of Fracking." Annual           Review of Environment and Resources 39 (2014): 327-362. Print.

Manuel, John. "EPA Tackles Fracking." Environmental health perspectives 118.5               (2010): 1. ProQuest.   Web. 19 Apr. 2016.

Rosenberg, Andrew A., et al. "Exposing Fracking to Sunlight." Issues in Science and          Technology 31.1(2014): 74-9. ProQuest. Web. 19 Apr. 2016.

“The Process of Hydraulic Fracturing.” United States Environmental Protection                 Agency. EPA, 16 Oct. 2015. Web. 19 Apr. 2016.

Twomey, Daniel F., et al. "Fracking: Blasting the Bedrock of Business." Competition           Forum 12.1 (2014): 204-16. ProQuest. Web. 25 Apr. 2016.

Usborne, David. "How Fracking is Turning America into World's Biggest Oil Producer."         The Independent: 32. Mar 12 2014. ProQuest. Web. 19 Apr. 2016.

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