Lessons from an Early-Mover: Shale Gas Policy Development in Pennsylvania

Abstract

The emergence of hydraulic fracturing and horizontal drilling techniques is generating a dramatic expansion of the development of domestic natural gas resources in the United States and abroad. Fracking also poses a series of environmental protection challenges that cut across traditional medium and program boundaries. Formal constraints on federal government engagement thus far devolve considerable latitude to individual states for policy development. This provides an important test of whether recent scholarly emphasis on highly-innovative state environmental and energy policies can be extended to this burgeoning area. Pennsylvania has moved to the epicenter of the fracking revolution, reflecting its vast Marcellus Shale resource and far-reaching 2012 legislation. This paper examines the Pennsylvania case and notes that the emerging Pennsylvania policy appears designed to maximize resource extraction while downplaying environmental considerations. The case analysis generates questions as to whether this experience constitutes an influential state early-mover that is likely to diffuse widely or is instead an aberration in a rapidly-developing state policy development process.

Keywords: energy policy, hydraulic fracking policy, state environmental policy

JEL Classification: H70, H77