New Yorkers forced to wait while Pennsylvania enjoys gas-driven economic boom


The benefits generated by gas development in Pennsylvania have largely been denied to New Yorkers as a result of a statewide moratorium on hydraulic fracturing.

We've previously looked at how the policy environments in Texas and California have affected the pace of energy development in those states, putting them on very different trajectories.

While the contrast between those two jurisdictions may have been particularly striking, given the sizes of their respective economies and energy reserves, there are numerous other examples that show the importance of a pro-growth atmosphere and the economic repercussions of neglecting opportunities for new development.

Parts of New York and Pennsylvania both sit atop the Marcellus shale, a gas-rich formation that is currently only generating tangible benefits for those on one side of the interstate border.

Evaluating the economic benefits gas development has brought Pennsylvania

Researchers at Pennsylvania State University looked at data for five counties involved in gas development to determine how local economies have been affected by an increase in drilling activity. Previously, we looked at a similar study performed in Texas.

According to the Penn State study, the increase in spending by consumers and businesses in these communities "plays a significant role in the local economic impact."

"Much of this is seen in the secondary businesses such as local construction, trucking, hotels, food service and other non-specialized services not unique to the industry," the report explained.

Study points to major losses for New York

In New York, residents have been denied access to the opportunities that gas development has afforded to people across the border in Pennsylvania. The administration of Governor Andrew Cuomo has maintained a moratorium on hydraulic fracturing for years while it has conducted studies on the health and environmental impacts of the practice.

Karen Moreau, executive director of the New York State Petroleum Council, explained the disadvantage of waiting in a statement published by the Statewide News Network.

"With every day that goes by in Upstate New York when well production doesn't begin, these communities are losing out on local property taxes that could be generated from producing gas wells," Moreau said.

That statement is backed up by serious research on the subject. According to a 2011 report from the Manhattan Institute, ending the moratorium on hydraulic fracturing could generate tens of thousands of jobs and billions in economic output.

Surveys find broad support for development among voters

A joint study from Cornell and Penn State looked at support for oil and gas drilling in the two states. Not surprisingly, support for development of new oil and gas wells is stronger in Pennsylvania, where residents have a had a chance to enjoy the economic benefits associated with gas development.

In the Keystone State, 47 percent of respondents expressed support for gas production from the Marcellus, while 34 percent said they were undecided and 19 percent voiced opposition. In New York, 40 percent indicated that they support development of the Marcellus, while the rest of the respondents split were almost evenly between indecision and opposition.

Notably, people were more likely to support than to oppose the expansion of oil and gas development in both states. A nationwide poll conducted by the Western Energy Alliance found an even greater level of support for domestic oil and gas development.

Going forward, it will be critical for voters and elected officials to continue educating themselves about the impact of energy development and for the industry to remain committed to bolstering the safety and efficiency of its operations by adopting the most modern oil production equipment. This cooperation between stakeholders will be essential for citizens throughout the country to be able to look forward to reaping the benefits of an ongoing boom for years to come.