JLF’s Becki Gray weighs in on steps taken by legislative reformers and the governor to continue the state’s economic recovery by safely unleashing North Carolina’s energy sector.
Natural gas development is occurring in 32 states. With the potential for rich gas deposits in at least 10 counties, North Carolina needs to become one of those states. Hydraulic fracturing and natural gas exploration measures advanced during the short session.
Under Session Law 2014-4, the moratorium on fracking was lifted, the deadline for fracking rules is Jan. 1, 2015, permits can be issued soon after all rules are in place, and a new Oil and Gas Commission will adopt rules and oversee the development of any oil and gas resources that are uncovered. The new fracking regulations protect the environment, the industry, and property owners, and ensure the health and safety of citizens.
Extracting natural gas can have a significant impact on state and local economies with job creation, capital investments, and tax revenues. Just as 31 other states have done, North Carolina has established a severance tax to ensure that costs of natural gas extraction are paid for by the industry and that taxpayers receive benefits from production.
Many states are seeing game-changing boosts to their economies. Perhaps most significant is that natural gas development can reduce energy costs.
A little-reported provision in the fracking bill could have long-term and significant impacts on energy costs in North Carolina. Section 27 orders the State Energy Office to study and make recommendations on comprehensive long-range energy policy, looking at not only environmental impacts but also the economic effects of different sources of energy.
The study will revisit a 2007 requirement mandating that 12.5 percent of our energy come from efficiency measures and renewable energy sources — a requirement that is proving impractical and expensive. Too often the costs associated with energy and the economic impact on consumers and businesses are overlooked.