Editor & Publisher, Marcellus Drilling News (MDN)
Pennsylvania has a window of opportunity to forge the future for its young residents by developing new industry that builds on our shale energy resources.
One year ago Chevron Appalachia and People’s Natural Gas teamed up to release a study called “Forge the Future: Pennsylvania’s Path To An Advanced, Energy-Enabled Economy.” Rather than wait around for “someone else” to flesh out a plan to leverage what Chevron and People’s call a $60 billion (!) opportunity in PA, they went ahead and did it themselves. Smart people.
That was Phase I. Others have joined the effort which has morphed into a loose organization called PA Forge The Future. The group has just launched Phase II, a new study called “Ideas for Action: Actionable Initiatives to Accelerate Energy-Enabled Economic Development in Pennsylvania.”
This “part 2” initiative uses the roadmap developed last year and recommends specific, concrete steps that can be taken to make that $60 billion future happen.
Unfortunately, many of the steps will need to be taken by Pennsylvania’s governor–and the current governor is a putz. We don’t think he’ll pay much attention to the great work done by this group. But there you go. You work with what you have and try to make changes.
The critical issue is, according to David Taylor (president of the Pennsylvania Manufacturers Association), “The window of opportunity for Pennsylvania to realize this vision is short…We must take action now.” We agree. But we’re not holding our breath, not with the bumbling Tom Wolf as Governor. Here’s an excellent article on the new report from the Beaver County Times:
Pennsylvania’s population and economic growth are stagnant, but a report published Thursday has a solution: capitalize on the “historic opportunity” presented by the state’s natural gas reserves to craft a “new, vibrant and growing” state.
The 22-page report, called Forge the Future, was undertaken by a consortium of businesses across Pennsylvania that banded together to plan how to best capitalize on the burgeoning energy industry in the state.
While companies such as Chevron and Peoples Gas helped spearhead the study, other companies including Shell Chemicals and FirstEnergy participated in it, as did several universities, government boards and trade groups. All together, more than 100 organizations participated.
The report didn’t mince words when talking about the economic opportunities presented by the natural gas industry. It concluded the state’s gross domestic product could increase by $60 billion while 100,000 new jobs could be realized, as well as several billions of dollars in new tax revenues.
Despite that, those numbers and projections can only be realized if state policymakers and agencies undertake significant reforms.
Suggestions contained within the study include comprehensive tax reforms, a regulatory environment that fosters growth and innovation, investment in infrastructure upgrades, and streamlined permitting processes for businesses interested in building here.
The study also pointed to specific steps state leaders can take to make the area more attractive and poised for growth.
Specifically, it called for the development of ethane storage and distribution hubs, expanded investment in natural gas pipelines and investing in site development “targeted to the needs of petrochemical manufacturers.”
The authors of the study repeated a claim that’s been made before: With the right amount of investment and incentives, Pennsylvania could soon become a “world-class petrochemical hub” with three to five ethane cracker plants.
Pennsylvania is already an “ideal location for the emergence of a second major petrochemical manufacturing hub in the United States” because of its natural gas reserves, proximity to customers and markets, and abundant waterways that allow for easier transport, according to the study.
But state leaders need to do more than just enact regulatory reforms. The study suggested that leaders must create an educational awareness program to foster “a more thorough understanding of the historic economic growth potential afforded by our vast energy resources.”
In addition, workforce development boards across the state must work together to form a “broad-based collaboration” to ensure enough workers will be available to fill jobs when they become available, according to the study.
In commenting on the study, David Taylor, president of the Pennsylvania Manufacturers Association, said the state has a chance to become the “epicenter of next-generation advanced manufacturing” and to be a domestic leader in the energy industry.
Despite that, time might be running out to fully capitalize on this emerging industry.
“The window of opportunity for Pennsylvania to realize this vision is short,” Taylor said. “We must take action now.”
Gene Barr, president of the Pennsylvania Chamber of Commerce, said the state’s “uncompetitive tax structure and a lack of infrastructure” are already causing Pennsylvania to lose out on lucrative economic opportunities.
“Pennsylvanians deserve better, and this report puts forth an active, strategic agenda to make energy-enabled growth a reality,” he said. “It should serve as a catalyst for a much-needed statewide effort to help advance a stronger economy and ensure that Pennsylvania remains a world-class energy hub for generations to come.”
And, here’s a good overview of the recommendations made in the report:
Forge The Future, an initiative of Pennsylvania businesses across the state, Thursday called for a new era of economic growth in Pennsylvania, releasing Ideas for Action, a report that highlights specific actions the Commonwealth can and should implement to capitalize on its world-class energy assets and grow its way to more revenue, population and job growth.
Among the recommendations are–
— Cabinet-Level Energy Executive: Pennsylvania should create a cabinet-level leadership position (Energy Secretary, Executive, or “Czar”) with exclusive responsibility for driving energy-enabled economic development in the state. This would give appropriate status to the energy economy and its potential to create significant GDP, jobs, wages and population growth impact.
— Pennsylvania Energy Investment Office: Create a new Pennsylvania Energy Investment Office, led by a cabinet-level executive, to be the Commonwealth’s one-stop resource for helping streamline the process of doing energy business in PA – serving as an ombudsman to coordinate regulatory, permitting and other needs. The office should be staffed and funded appropriately, with the goal of leveraging economic growth, which, as this and other studies/reports have estimated, could be more than $60 billion.
— Create Statewide Energy Investment Strategy: This new office would be charged with creating and leading a well-defined statewide energy business and investment strategy. This could include an energy-focused business attraction/investment resource kit for local and regional economic development agencies, and regular interaction to coordinate and collaborate on energy-related economic development.
— Streamline Pipeline Permitting Process: Developing Natural gas transmission and distribution is vital to utilizing the abundant resource across the state, and delivering NGLs and LNG to export terminals, including a potential Penn America LNG facility in Chester County. Many regulatory hurdles exist, including oversight at both the state and federal level for natural gas infrastructure projects.
— Expand Pipeline Investment Program: which currently provides grants to construct the last few miles of natural gas distribution lines to business parks and existing manufacturing and industrial enterprises, to include residential uses.
— Natural Gas Micro-Grids: Create partnerships with organizations and institutions that operate large physical plants (government, universities, health care institutions) to build gas-fueled micro-grids for power generation
— New Distributed Energy Technology: Develop partnerships between industries and STEM- focused colleges and universities to explore new technologies in distributed energy
— Encourage CHP, Fuel Cells: Leverage utility ratemaking policy to facilitate adoption of natural gas as a heating and power source (such as CHP and fuel cells)
— Convert Transit Fleets To Gas, Support Fueling Infrastructure: Seek federal and state assistance to convert all major transit fleets to gas powered buses; Support installation of natural gas fueling stations at all PA Turnpike service plazas; Develop port infrastructure for natural gas fueling on cargo ships in Philadelphia to take advantage of the eventual move from high-sulfur diesel.
— District Energy Zones: where long-term Power Purchase Agreements would incent use of natural gas-fueled micro-grids for manufacturing facilities and support the work of the CHP working group within the Public Utility Commission to identify additional ways to help manufacturers adopt CHP solutions for their facilities…
“Right now, only a fraction of Pennsylvania’s natural gas reserves have been captured. The state is currently sitting on untapped opportunities that could propel its economy and turn the Commonwealth into a leader in the 21st century global economy,” said Rob Wonderling, President and CEO, Chamber of Commerce for Greater Philadelphia. “Forge The Future convened 100 business, academic and economic development leaders from across the state to identify definitive strategies for optimizing the economic opportunity at hand and generating broad-based prosperity for all Pennsylvanians.”
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