Pennsylvania

Energy. Environment. Economy.

Susan Phillips

Reporter

Susan Phillips tells stories about the consequences of political decisions on people's every day lives. She has worked as a reporter for WHYY since 2004. Susan's coverage of the 2008 Presidential election resulted in a story on the front page of the New York Times. In 2010 she travelled to Haiti to cover the earthquake. That same year she produced an award-winning series on Pennsylvania's natural gas rush called "The Shale Game." Along with her reporting partner Scott Detrow, she won the 2013 Alfred I. duPont-Columbia University Journalism Award for her work covering natural gas drilling in Pennsylvania. She has also won several Edward R. Murrow awards for her work with StateImpact. She recently returned from a year as at MIT as a Knight Science Journalism Fellow. A graduate of Columbia School of Journalism, she earned her Bachelor's degree in International Relations from George Washington University.

Energy companies donate more than $1 million to Corbett’s campaign coffers

Governor Corbett speaks to the Shale Gas Insight conference in September 2011.

Scott Detrow / StateImpact Pennsylvania

Governor Corbett speaks to the Shale Gas Insight conference in September 2011.

With the election less than a week away, Tom Corbett is way ahead when it comes to support from energy interests including coal, natural gas and power companies operating in the state. The Pittsburgh Post-Gazette has tallied up campaign contributions for the governor’s race and Tom Corbett’s campaign took in $1,148,351 in energy donations. That’s almost ten times the amount of energy dollars going to his opponent Democrat Tom Wolf. The Post-Gazette reports Wolf raised $192,985 from energy companies, including coal, wind and pipeline operators. Three of Wolf’s top individual energy contributors seem to have hedged their bets by also donating to Corbett.

Corbett’s highest individual donors are shale executives. Terrance Pegula from East Resources donated $250,000 to the governor, while John Monk of Energy Corporation of America gave $100,000. Third in line is Kelsey Warren, CEO of Energy Transfer Group, which has plans to build a pipeline to transport Marcellus Shale gas.

Wolf and Corbett differ when it comes to taxing the natural gas industry. Corbett wants to maintain the status quo by charging $50,000 a well. But Wolf wants to impose a five percent tax on the market value of the gas produced. Even as the race tightens, it’s unclear what this money will mean to Corbett. Today’s Franklin and Marshall survey has Tom Wolf still leading in the polls.

Election 2014: Corbett and Wolf differ on approach to Obama’s carbon rules

The Homer City Generating Station, Homer City, Pa.

Keith Srakocic / AP Photo

The Homer City Generating Station, Homer City, Pa.

Election day is just a week away. And whoever ends up winning the race for Pennsylvania’s governor will have climate change on their agenda. That’s because states now have to implement new EPA rules decreasing carbon emissions at power plants. But the two candidates are far apart on their approach to reducing the state’s carbon footprint.

The Environmental Protection Agency’s proposed rules would make Pennsylvania reduce its carbon emissions by 32 percent. And that means burning less coal.

Governor Corbett has criticized the EPA’s proposed rules.

“Those are aimed directly at the coal industry,” Corbett told StateImpact. “Right now [the rules are] going to cost Pennsylvanians 6200 miners jobs, tens of thousands of jobs beyond that, but also [they're] going to cause energy costs to go up because right now in Pennsylvania 40 percent of our electricity today is obtained through coal.” Continue Reading

Governor Tom Corbett says the impact fee is still the best deal for Pennsylvanians

Governor Tom Corbett speaks about taxing the Marcellus Shale in an interview at WHYY in Philadelphia

Emma Lee / WHYY

Governor Tom Corbett speaks about taxing the Marcellus Shale in an interview at WHYY in Philadelphia

StateImpact Pennsylvania’s Susan Phillips sat down with both candidates for governor and pressed them on energy issues. The candidates visited WHYY in Philadelphia, where several reporters interviewed them for about ten minutes each. Wolf has proposed taxing the Marcellus Shale gas differently than Governor Corbett. Wolf wants to charge a 5 percent tax on the market value of the gas at the wellhead. This is called a “severance tax” or some call it an “extraction tax.” Corbett wants to stick with the current impact fee, which charges a flat fee of $50,000 a well. The following is the transcript and audio of StateImpact’s interview with Governor Tom Corbett, edited for time and clarity.

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Democrat Tom Wolf talks extraction tax and protecting the environment

Democrat Tom Wolf talks to reporters at the WHYY studio in Philadelphia.

Lindsay Lazarsky / Newsworks/WHYY

Democrat Tom Wolf talks to reporters at the WHYY studio in Philadelphia.

StateImpact Pennsylvania’s Susan Phillips sat down with both candidates for governor and pressed them on energy issues. The candidates visited WHYY in Philadelphia, where several reporters interviewed them for about ten minutes each. Wolf has proposed taxing the Marcellus Shale gas differently than Governor Corbett. Wolf wants to charge a 5 percent tax on the market value of the gas at the wellhead. This is called a “severance tax” or some call it an “extraction tax.” The following is the transcript and audio of StateImpact’s interview with Democrat Tom Wolf, edited for time and clarity.

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2014 Governor’s Race: Face off over the sweet spot on taxing Marcellus Shale

Governor Pennsylvania Debate

Tom Gralish / The Philadelphia Inquirer

Governor Tom Corbett (L) with Democratic challenger Tom Wolf (R) at a debate in Philadelphia in October.

Here’s something Governor Tom Corbett and his democratic challenger Tom Wolf agree on: Each calls Pennsylvania’s Marcellus Shale natural gas a “game-changer” for the state’s economy. But they disagree on how to get the most out of the gas boom for all Pennsylvania residents. Comparisons to Texas keep coming up in the race. And natural gas production has recently put Pennsylvania second only to Texas. So how exactly does Texas tax the gas drillers, and how is it different in Pennsylvania. StateImpact Pennsylvania drills down into the sometimes taxing and dull fiscal policy to get at the answer.

 

How does Pennsylvania tax natural gas?

In 2012 the state implemented the “impact fee.” This is a flat fee charged to each well. The levy can change from year to year based on natural gas prices and the Consumer Price Index, but in 2013, gas companies paid $50,000 for each new well they drilled. Smaller, vertical wells were $10,000. The impact fee has so far generated $636 million in three years.

Sixty percent of the impact fee revenue stays at the local level, going to counties and municipalities hosting wells. The rest goes to various state agencies involved in regulating drilling and to the Marcellus Legacy Fund – which gets spread out around the state for environmental and infrastructure projects.

Like other businesses in Pennsylvania, the gas industry gets charged corporate taxes as well. At 9.99 percent, Pennsylvania’s corporate tax is considered high. It’s unclear how much the drillers actually pay, because many are not registered in the state and do business elsewhere. Governor Corbett says he has not done an analysis on what the drillers pay in corporate taxers. But he says when combined with the businesses that support and serve the industry, the total revenue is $2.5 billion for the past six years. Continue Reading

Fracking in Texas helps the state’s public school fund top Harvard’s endowment

Lenny Rodriguez works on a Choice Exploration Inc. natural gas rig near Devers, Texas. Drilling on state lands has helped create the largest public school endowment in the country.

Mike Fuentes / AP

Lenny Rodriguez works on a Choice Exploration Inc. natural gas rig near Devers, Texas. Drilling on state lands has helped create the largest public school endowment in the country.

A fund that collects rents and royalties from oil and natural gas development to Texas public schools recently became the largest education endowment in the country.

The publicly run endowment, called the Permanent School Fund, is worth $37.7 billion dollars. That’s $1.3 billion more than Harvard University’s $36.4 billion endowment. Jim Suydam, a spokesperson for the Texas General Land Office, says a big part of the story is the shale gas boom.

“We’re making a ton of money off natural gas,” said Suydam. “We made over a billion last year. The shale plays are huge down here. You can see them from space.”

Suydam says that from 1874 to 2003, $7.9 billion was deposited into the fund.  Since 2003, just before the shale gas boom began, oil and natural gas has helped increase the endowment by $8.1 billion. These deposits have generated enough return on investments to bring the grand total close to $40 billion. The Permanent School Fund doesn’t cover all expenses for Texas school children, but Suydam says it contributes an average of $400 per student per year. It also backs bonds by local school districts, allowing them to get a triple-A rating. Continue Reading

Environmentalists seek to halt construction at Cove Point LNG export plant

Dominion's offshore loading platform at Cove Point. Lusby, Maryland. Dominion wants to start exporting LNG from this platform.

Lindsay Lazarski / WHYY/Newsworks

Dominion's offshore loading platform at Cove Point. Lusby, Maryland. Dominion wants to start exporting LNG from this platform.

Environmental groups have filed a motion with the Federal Energy Regulatory Commission (FERC) to stop the current construction of Dominion’s liquefied natural gas export facility in Cove Point, MD. The groups also want FERC to reverse their recent decision approving the plant. 

Last month FERC approved Dominion Energy’s plan to transform the Cove Point plant from an import terminal to an export facility, which will ship out more than 5 million metric tons of liquefied natural gas each year. Cove Point is the fourth export terminal approved by the Federal Energy Regulatory Commission, or FERC. It will be the first connected to the Marcellus Shale by pipeline.

Opponents of the plan say the plant will stimulate natural gas drilling in Pennsylvania’s Marcellus Shale, thereby increasing pollution in shale gas communities. Jocelyn D’Ambrosio is an attorney with Earthjustice.

“In neglecting to prepare a thorough review of the environmental impacts of Dominion’s controversial project, FERC is prioritizing the desires of a powerful company over the health and safety of the people of Calvert County, Marylanders, and communities throughout the Marcellus shale region,” wrote D’Ambrosio in a release.  Continue Reading

Corbett says taxing natural gas may be a future option

Governor Corbett discussing his budget proposal on witf's Smart Talk Friday.

Heather Woolridge/ witf

Governor Corbett speaking at WITF.

Governor Tom Corbett says he’s thinks taxing natural gas could be an option. Just three weeks before the election, the governor is battling for his political future. In an exclusive interview with StateImpact Pennsylvania, Corbett said he thinks rather than the extraction tax advocated by his Democratic opponent Tom Wolf, it may be better to tax the transport of the gas within the state.

“Maybe the tax instead of being at the wellhead, should be in the transmission line,” said Corbett. “Now we can probably only tax it in the transmission line that is intrastate because if it goes into interstate, that is a Washington issue.”

Back in 2012 Governor Corbett enacted the impact fee, which charges Marcellus Shale gas drillers $50,000 per well.  Critics, including his Democratic opponent Tom Wolf, say that method leaves a lot of money on the table. Pennsylvania is the only major gas producing state without a severance tax, which taxes the value of the gas extracted. Wolf has proposed a five percent severance tax. Corbett continues to oppose this kind of tax for now, saying it would cut too much into the drillers bottom line, causing them to move out of state. But he’s no longer calling it “un-American.” Instead, he says once the vast majority of the wells are drilled, it may be time to enact a tax.

“If this industry was 10-15 years old already, I think we’d be having a different conversation,” said Corbett.

Corbett gave no details of what a transmission gas tax would mean. But pipelines that cross state lines are regulated by the federal government, so the state would be limited to the transmission lines within Pennsylvania. Pipeline companies may be an easy taxation target because they already benefit from tax breaks. Natural gas transmission companies are exempt from both federal corporate income tax and Pennsylvania’s gross receipts tax. Continue Reading

Commonwealth Court takes up issue of drilling in state parks and forests

A sign posted in Susquehannock state forest, which makes up part of the most "climate resilient" land on the East Coast..

Susan Phillips / StateImpact Pennsylvania

A sign posted in Susquehannock state forest, where land has been leased for gas drilling.

The fate of expanded natural gas drilling in Pennsylvania’s parks and forests is now in the hands of seven Commonwealth Court Judges. Governor Tom Corbett wants to lease 25,000 acres of additional state land to drillers in order to raise $95 million to plug a hole in the 2014-2015 fiscal year’s $29.1 billion budget. The Commonwealth’s seven judge panel heard arguments Wednesday from an environmental attorney challenging the Governor’s authority to lease that land, and to use the proceeds for the general fund.

Pennsylvania Environmental Defense Foundation Attorney John Childe says both current Governor Tom Corbett, and former Governor Ed Rendell, violated the state constitution by disregarding the environmental impacts of drilling on state parks and forests.  Childe’s case hinges upon the state constitution’s environmental rights amendment. The environmental rights amendment became relevant for the first time earlier this year when the Supreme Court upheld challenges to the state’s new oil and gas law in Robinson Township v. Commonwealth. Childe says the amendment clearly puts ownership of the state’s parks and forests in the hands of Pennsylvania citizens, not the governor or general assembly.

“The constitution describes basic rights for the people that are not to be impaired by other governmental decisions,” Childe told StateImpact outside the courtroom. “It’s the same as the right to freedom of religion.”

A total of 700,000 acres of state forest land is available to oil and gas drillers. Under the direction of Governor Rendell, the Department of Conservation and Natural Resources leased 132,000 acres. (Not all of the mineral rights are under state control. About 315,000 acres of state forest land lies above natural gas deposits owned by private leaseholders.) The leases occurred despite opposition from DCNR’s leadership. Just before leaving office, Rendell then issued an executive order placing a moratorium on future leases.

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Bill would have PA lawmakers approve Obama’s carbon reduction plan

The stacks of the Homer City Generating Station in Homer City, Pa.

AP Photo/Keith Srakocic

The stacks of the Homer City Generating Station in Homer City, Pa.

A bill that would allow legislators to weigh in on a federally mandated plan to cut carbon emissions may see a final vote before lawmakers end this year’s session. President Obama’s new climate change plan set a goal for Pennsylvania to cut carbon dioxide emissions by 32 percent by 2030. The EPA left it up to the states to decide how to reach their targets. In Pennsylvania’s case, the state Department of Environmental Protection develops plans to meet EPA mandated rules. But state representative Pam Snyder, a Democrat from the southwestern corner of the state, wants lawmakers to approve the carbon reduction plan crafted by DEP before it gets submitted to the EPA.

The House has already approved HB 2354, and today the Senate’s Environmental Resources and Energy Committee gave it a thumb’s up. Rep. Snyder says she worries Obama’s efforts to cut carbon emissions would include shutting down coal generated electricity plants, hurting the coal mining communities she represents. In the legislative memo for HB 2354, she writes that any plan that goes to the EPA for approval must go through the legislature first.

“In short, my legislation would make clear that the people who were elected to govern Pennsylvania will have the final say on what happens – not unelected, unaccountable regulators.  While EPA managed to develop this rule without Congressional authorization, the Pennsylvania General Assembly will be the final arbiter of how the Commonwealth approaches greenhouse gas regulation.”

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