Thanks to booming production from United States shale resources, this country is now the world’s largest oil and natural gas producer. Further, Pennsylvania is the second-ranking state in natural gas and natural gas liquids production, and demand for the vast resources housed in the Marcellus and Utica Shale reserves continues to rise.
As a result, Pennsylvania’s leading job-creating industries and homeowners are seeking more affordable energy options to heat homes and schools, provide feedstock, and power. All Pennsylvanians are benefitting — natural gas development has contributed an astounding $34.7 billion to the state economy, generated billions in state taxes, and lowered utility bills for millions of people. With the demand and public benefits so clear, it important that we understand why such critical development cannot, and should not, be held hostage by a small minority.
Recognizing the economic, environmental, and national security benefits of natural gas development, the Obama administration this year released a Quadrennial Energy Review report, which calls for as much as $3.5 billion of annual investment in pipelines through 2030 to carry domestic natural gas and liquids to market centers regionally. The funding would be provided by oil and gas producers and pipeline companies, and not US taxpayers. This past summer, Pennsylvania Governor Tom Wolf convened a Pipeline Infrastructure Task Force to identify ways to remove unnecessary obstacles to the development of the underground pipeline network.
So the public and private sectors are working cooperatively toward sensible development policies, and are doing so with a deep respect for the extensive pipeline approval process (generally 4-5 years of public hearings and procedures) established to protect safety, the environment, and broader public community needs and concerns. Important community issues must be appropriately examined and balanced with the affordable energy resources that pipelines make available and the jobs and economic benefits they deliver.
For such vital infrastructure, it’s important to find that balance between private property rights and the benefits delivered to state and regional communities. In some cases, with restraint and as intended by law, the eminent domain process can provide that balance.
The concept of eminent domain is not new. The practice has been embodied in Federal, State and local laws for centuries to help meet the needs and demands of citizens and deliver services that benefit the public.
From roads to schools, airports to water and sewer lines, examples of infrastructure built through the select use of eminent domain are everywhere. The state of Pennsylvania, for instance, utilized eminent domain to build the Blue Route highway system to connect key suburban Philadelphia-area counties and the broader metropolitan area. That project serves as a vital corridor for commuters and businesses and has made the Philadelphia suburbs a more attractive place to live, resulting in property values going up.
Eminent domain is not only used for government and public works projects, but by law, it can also be granted to companies that build critical infrastructure projects such as power lines, railroads and pipelines. Those companies considered “public utility corporations” are granted that status not for private gain, but for public benefit.
There are extensive requirements for companies to make good-faith efforts to reach agreement with landowners, but it is inevitable that eminent domain will come into play with projects that cover long distances involving many properties. In those instances, and without eminent domain law, individual landowners would have the power to stop important infrastructure projects that deliver public benefits to thousands of Pennsylvanians. And before a company can have access to a property against the wishes of its owner, a judge must decide whether the rules have been followed, including appropriate compensation for the landowner.
Pipeline projects meet the test as a public interest project because they have multiple customers and transport products that we all rely on every day to heat Pennsylvania homes, fuel vehicles and gas grills, and power Pennsylvania factories and businesses. With a greater, more stable supply of energy, residents save money on their utility bills, the cost of doing business in the region drops significantly, and new business and investment are drawn to the region.
New energy infrastructure projects carried out by established companies with demonstrated track records of safety and stability will continue the growth of the region’s blossoming prosperity. Most of the multi-billion-dollar pipeline projects planned for Pennsylvania will benefit the entire Commonwealth, including our fellow citizens who find that prospect hard to accept.