Cuomo to lift moratorium on fracking in NY?

Republicans didn’t stand a chance against Andrew Cuomo in the New York gubernatorial election.  However, they can’t be too displeased with the results.  Not only has Cuomo taken on the public-employee unions (especially teachers) in an effort to restore fiscal sanity to state finances, Cuomo has now decided to restore a little sanity to energy policy, too:

The Cuomo administration is seeking to lift what has effectively been a moratorium in New York State on hydraulic fracturing, a controversial technique used to extract natural gas from shale, state environmental regulators said on Thursday.

The process would be allowed on private lands, opening New York to one of the fastest-growing — critics would say reckless — areas of the energy industry. It would be banned inside New York City’s sprawling upstate watershed, as well as inside a watershed used by Syracuse, and in underground water sources used by other cities and towns. It would also be banned on state lands, like parks and wildlife preserves.

It will most likely take months before the policy becomes official. On Friday, the State Department of Environmental Conservation will release a long-awaited study of the process, widely known as hydrofracking. The report will include recommendations about how to proceed, and then there will be a lengthy period for public comments before a final determination can be made.

Consider this a qualified success for the energy industry.  It comes with more regulation and bans than they would have preferred, but once implemented, the new policy would allow New York to exploit the Marcellus Shale formation at least as much as explorers might have hoped.  Cuomo’s action also promises to undo a “permitorium” approach that has mostly frozen the industry out of the Marcellus shale for the last few years.

Cuomo’s report overstates the danger of fracking to water supplies, as Reason TV explained earlier this week, which may disappoint some boosters of the process.  That’s more due to politics than to safety, as Cuomo has to appease environmental groups that have declared war on fracking in New York and other places.  Cuomo’s statement attempts to head off the environmentalists by reminding them that they should cheer more exploration of natural gas, while promising to keep watersheds “sacrosanct”:

“The economic potential from the Marcellus Shale could provide a badly needed boost to the economy of the Southern Tier and even many environmentalists agree we want to produce more domestic natural gas that reduces the need for environmentally damaging fuel sources such as coal,” his campaign statement said, while adding, “Existing watersheds are sacrosanct, and Andrew Cuomo would not support any drilling that would threaten the state’s major sources of drinking water.”

We’ll see how this new approach relates to actual exploration and extraction.  There seems to be plenty of room for regulatory mischief in this policy statement, but Cuomo appears to want the economic windfall that would come from full exploitation of the Marcellus Shale play.  At the Times’ Dot Earth blog, Andrew Revkin notes that Cuomo will be shutting down a nuclear plant as part of his new energy policy — and that will mean a need for more domestic energy production:

I’m not supportive of the governor’s plan to shut the downstate nuclear power complex at Indian Point, eight miles from my house, which he signaled by sending a top emissary to the offices of Entergy, the company that operates the plants, to explain his decision. …

It was notable to see David Lochbaum, a longtime critic of Indian Point and its operators who works at the Union of Concerned Scientists, describe in The Times article the strain on the region’s electric power transmission system without the nuclear plants:

Lochbaum, the director of the nuclear safety project at the Union of Concerned Scientists, an advocacy group, said the challenge of replacing Indian Point had more to do with transmission of existing power than generating power. Local resistance has prevented the building of new transmission lines to bring power from the north to New York City and its suburbs.

“If you took Indian Point out of the mix, one of the options would be to replace it with more power from upstate New York or Canada, but the power lines are already at capacity,” Mr. Lochbaum said. “The power might be there, but not the ability to get it to people who need it.”

Revkin thinks that by shutting down Indian Point, Cuomo will either inadvertently or deliberately put New York in a position where it will be much more dependent on natural gas from Marcellus Shale.  Either that, or New York will need a hefty investment in transmission lines and even more dependence on outside sources of energy, a situation that won’t make Cuomo terribly popular in New York City.

It’s worth keeping an eye on this debate over the next few months, and to see how quickly Cuomo expedites exploration and extraction through fracking.