Even Higher Energy Taxes Threaten Pa. Jobs

Shale development in the Commonwealth continues to benefit our economy and environment. From providing regional building trades unions with thousands of good-paying jobs to delivering consumer savings for families and improving air quality, these clear benefits touch all corners of Pa.

That’s why it’s critical to continue the safe development of our region’s energy infrastructure. Importantly, as the Laborers International Union of America’s (LiUNA) Dennis Martire writes in a recent column, energy infrastructure development creates “good family-wage jobs that represent the economic future for many communities.”

Yet, some in Harrisburg want even higher energy taxes that threaten jobs and jeopardize shale’s benefits. It’s an undeniable fact – as reported in the Associated Press and other media outlets – that Gov. Wolf’s plans for higher energy taxes will fall far short of the promised $1 billion revenue projections.

And according to the House Appropriations Committee chairman, “It is shocking how much the [Wolf] administration has overstated the revenue a severance tax would generate. … A severance tax would only generate a fraction of what the governor suggests and would not get anywhere close to the billion the governor is promising.”

Put aside for a moment that Gov. Wolf’s energy tax math doesn’t add up, and also consider the fact that the Pittsburgh Tribune-Review reports the “Wolf administration and its allies are misleading the public” by stating that the highest-in-the-nation energy taxes would exclusively fund education. As the MSC’s Dave Spigelmyer said: “Revenues generated from (Gov. Wolf’s) severance tax proposal would not be directed exclusively to fund education, as frequently stated.

It’s clear that even higher energy taxes – which won’t generate the promised revenue amounts but will subsidize wind and solar companies – will cost local jobs, especially for small- and medium-sized businesses based locally, along the shale industry’s supply chain. We need policies that encourage energy and manufacturing job growth and investment into Pa. And many others agree.

HIGHER ENERGY TAXES THREATEN JOBS, ECONOMIC OPPORTUNITY

  • Wolf Lobbying for “Market-Crushing” Higher Energy Tax: A potentially market-crushing severance tax could impinge our state’s future growth. … In order to have affordable and available fuel supplies for power plants during this time of unprecedented change to the grid, state policymakers not impose additional costs on production, on top of the hundreds of millions of dollars in impact fees producers already pay. Imposing a severance tax on production could jeopardize Pa.’s ability to supply fuel for power generation. … Natural gas will help us continue to clean the air. Since 2008, state DEP data shows that emissions reductions of 68% for sulfur dioxide, 42% for particulate matter, 28% for nitrogen oxides and 12% for carbon monoxide have been achieved. … The state should be doing all it can to continue its role as an energy leader. … We must also promote continued, robust production of natural gas, not thwart production with a severance tax. (Sunbury Daily Item op-ed, 7/19/15)
  • Jobs at Risk with Even Higher Energy Taxes: The gas industry in Pa. has been a revolution, creating thousands and thousands of jobs and producing a revenue stream for Pa. through the impact tax and local, state and corporate taxes. This is an industry that we should want to not only remain in Pa. but also to grow. … It is expected that Pa. will suffer a loss of more than 6,000 jobs in the first year if a severance tax is passed. (Allentown Morning Call letter, 7/20/15)

INFRASTRUCTURE KEY TO DELIVERING SHALE BENEFITS

  • Energy Infrastructure Will Fuel Economic Growth: Washington Co. has opportunity for growth and expansion with the energy renaissance driven by shale development. … Energy development has been fueling local economic growth, including the creation of 1,762 jobs last year in Washington Co. alone. To continue fueling this growth and to supply valuable natural gas and gas byproducts to a resurgent manufacturing sector in Pa., we need to build adequate infrastructure. Safe and efficient pipelines are needed to move natural gas from the fields of Western Pa. to market and to help move our country toward energy independence. … The businesses and residents of Washington Co. have witnessed firsthand how the energy industry has been a catalyst for economic growth.… A Washington & Jefferson College study found that the shale industry contributed 15% to 20% of our county’s economic output between 2011-2013. … The proposed $3 billion Mariner East underground gas-liquids pipeline project is exactly the type of infrastructure we need. … This pipeline would help ensure our supply of fuels such as propane, ethane and butane, while contributing more than $4 billion to our state’s economy and supporting 30,000 new jobs. … Western Pa. can take advantage of the next phase of shale development by supporting the infrastructure needed to transport natural-gas products safely to market and connecting our region to the wider world. (Post-Gazette op-ed, 7/21/15)
  • Shale Infrastructure Creates “Good Family-Wage Jobs” that “Put Pa. Back to Work”: Across Pa., the shale industry has become a new economic engine for our state, supporting energy infrastructure projects that have brought new opportunity to thousands of residents, and increased the energy independence of our entire country. New pipeline projects are delivering both short-term employment benefits from construction, and long-term economic benefits from increased access to affordable natural gas and natural gas liquids. These new projects generate the kind of jobs that put our state back to work good family-wage jobs that represent the economic future for many communities across Pa. For the more than 25,000 members of LiUNA in Pa., and thousands of other workers across our state, these projects are not just pipelines. They are also a lifeline to family-supporting jobs. … We know that these projects will generate significant new tax revenues for our state, as well as new economic activity for local hotels, local restaurants, and local businesses. … If we excessively tax the shale industry, we risk hurting employers, workers and communities across the state. (Del. Co. Times op-ed, 7/19/15)

SHALE STRENGTHENS OUR ENVIRONMENT, NATIONAL SECURITY

  • “Shale is a Geopolitical Game Changer”: [Vets4Energy’s] message is simple: energy security equals national security. Shale energy is a geopolitical game changer. … The natural gas industry is key to the U.S finally achieving energy security. … Pa. is poised to be a leader on the world’s energy stage by increasing the United States’ energy independence and improving our national security. … But we are at risk of throwing it all away. Currently, there is a punitive severance tax under consideration in Harrisburg. … If enacted, it would levy the highest effective rate in the country, according to IFO. … To impede the development of natural gas at this critical time will put America’s energy independence and national security at risk. … Rather than placing a punitive tax on this critical industry, our elected officials need to support policies that help to build the infrastructure needed to expand the reach of this important resource. (Bucks Co. Courier Times letter, 7/21/15)
  • American Shale Resources “Bring Great Environmental Benefits”: It is hard to remember now, but it wasn’t so long ago that natural gas was seen as one of the most important solutions to global warming and a cleaner environment. … Natural gas is so clean, many of us burn it in our kitchens without need for chimneys or vents. It emits practically no mercury and 17 to 40 times less sulfur dioxide, according to our study with Breakthrough Institute. … Far from undercutting renewables, wind and solar energy depend on the gas-fired generation to keep the lights on when the sun isn’t shining and the wind isn’t blowing, which is about two-thirds or more of the time for the average wind or solar plant. (USA Today op-ed, 7/16/15)

Become a United Shale Advocate today and join thousands of others who support new jobs and a brighter future for generations to come – not even higher energy taxes.