October 21, 2020
There is no question that natural gas development in Pennsylvania has led to local, state, and national benefits. Second in the level of production in the United States, Pennsylvania’s natural gas industry has produced economic growth at the local and state level through job creation and business development. According to the most recent reports released by the Energy Information Administration, our state is behind only Texas in natural gas production with 6.21 trillion cubic feet of natural gas produced. It is impressive to note that nearly one-fifth of the natural gas produced in the United States comes from Pennsylvania and our state now leads the nation as a net energy exporter.
And nowhere have these positive economic impacts been more pronounced than in Washington County where we have been experiencing the benefits of the natural gas industry for over 15 years. Since the first commercially viable Marcellus Shale well was developed by Range Resources in Mount Pleasant Township in 2004 – the Renz #1 well – Washington County has been a leader in production, jobs, and economic impact. According to Pennsylvania Public Utility Commission (PUC) data, our county leads the state with 1837 wells and ranks second in the state in gas production with 876 billion cubic feet produced in 2019. That means 17.4% of all the natural gas produced in our state comes from our county. Only Susquehanna County ranks higher.
In addition, leading natural gas producers such as Range Resources, EQT, CNX Resources and Olympus Energy as well as secondary and tertiary suppliers to the industry have headquarters or have substantial presences in our county. These companies have created jobs, driven investment and created an environment for growth ... and those that work for them have become our neighbors.
Local governments and communities have also been the beneficiaries of the industry with Washington County again leading the state in impact tax distribution. In 2019, according to PUC figures, Washington County and our municipalities received over $6.6 million in impact tax revenue to fund infrastructure development, public improvements, and other projects important to our communities. This revenue has provided our municipalities with the resources necessary to keep our communities viable and maintain our high quality of life.
The natural gas industry has been an economic generator for our region and is leading our country’s energy independence. That is why it is important we continue to support its growth through smart policies and legislation, even during the state’s financial difficulties. As our Legislature addresses a state budget shortfall created by the COVID-19 pandemic, we must be cognizant to not inflict additional taxes such as a severance tax on an industry that has driven our economic growth for nearly two decades. In fact, a new severance tax on the industry combined with the existing impact tax would, in effect, result in a double tax and have the dual effects of limiting production and driving away jobs.
At a time when our nation has lost millions of jobs due to COVID-19 and with the full extent of the long-term economic damage still unknown, we can ill afford to further hinder industries that are leading us out of this pandemic. The natural gas industry is providing the jobs and the affordable energy Pennsylvania’s businesses and families need to power our economic recovery. It would be a mistake to turn off that power with a severance tax.