Lynn Helms, David Porter, others testify in front of House Committee about the effects of the EPA’s 3,900 rules on industry, states, jobs since 2009

Lynn Helms, director of the Oil and Gas Division of the North Dakota Department of Mineral Resources, testified before the House Committee on Energy and Commerce – Subcommittee on Energy and Power to discuss the effects EPA regulations have had on the state since 2009. Helms’ testimony, which can be read in full here, outlined the ways in which the EPA was creating duplicative and unproductive regulations in the state.

Helms presented a timeline of nine different topics – all of which have the ability to directly impact the way North Dakota regulates the oil and gas industry, starting with the 2010 EPA study of the relationship between hydraulic fracturing and drinking water, to the most recent 2016 request for emission information for existing oil and gas facilities.

Helms pointed to a number of issues, from studies which cannot be concluded due to the EPA Scientific Review Board dealing with concerns over the definitions of “widespread” and “systemic,” to rules that “potential conflict with (North Dakota’s Industrial Committee’s) mission to prevent waste, maximize recovery, and fully protect correlative rights (of mineral owners).”

“It is of great concern to North Dakota that the USEPA rule and guidance would potentially conflict with the Industrial Commission’s mission,” Helms stated in his testimony.

Helms also pointed out that many of the EPA’s regulation were disproportionately costly compared with the environmental threat. “Many states that run effective regulatory programs and have adopted hydraulic fracturing rules that include chemical disclosure, well construction, and well bore pressure testing should be explicitly exempted from the guidance,” Helms said to the sub-committee.

North Dakota’s Mineral Resources director encouraged the sub-committee to expand the use of the program FracFocus nationwide, saying it is “by far the best way for EPA to minimize reporting burdens and costs, avoid duplication of efforts, and maximize transparency and public understanding.

“EPA should consider funding of programs such as FracFocus and Interstate Oil and Gas Compact Commission and Ground Water Protection Council programs such as the State Oil and Gas Regulatory Exchange, UIC Peer Reviews, and National Field Inspector Certification Program,” said Helms. “All of these programs are overseen by governors and state regulators who can provide independent third-party certification, collection of information, and development of best practices about hydraulic fracturing operations in lieu of a new EPA mandatory reporting or voluntary disclosure program.”

He went on to add that some of the rules proposed by the EPA could have a direct impact on the planned expansion of North Dakota’s gas capture and infrastructure requirements, with changes to regulations like the transportation of drill cuttings potentially costing the state billions of dollars.

Other witnesses included, Travis Kavulla, Vice-Chairman of the Montana Public Service Commission and David Porter, Chairman of the Texas Railroad Commission.

Since 2009 EPA has published over 3,900 rules 

Since 2009, EPA has published over 3,900 rules, totaling 33,000 pages, according to a press release from the Energy and Power Subcommittee statement regarding the hearing.

“These rules broadly apply across the U.S. economy, including the electricity, oil and gas, and manufacturing and industrial sectors. In addition to the agency’s “Clean Power Plan,” the agency has issued over 100 greenhouse gas related rules, and other major rules affecting energy production and industrial activity. Members raised concerns that the EPA is exceeding its statutory authority and effectively becoming the nation’s energy regulator.

“Congress did not write the Clean Air Act to be the vehicle for taking command of state energy planning, the efficient and economical dispatch of electricity, or the production of oil and gas,” said Chairman Whitfield. “Congress did not write the Clean Air Act to provide EPA with the ability to create new regulatory powers and authorities so it can ‘transform’ the nation’s energy system. Yet, this agency is pursuing these actions.”

Witness testimony

David J. Porter, Chairman of the Railroad Commission of Texas, testified regarding concerns raised by EPA’s Clean Air Act (CAA) rules, commenting, “CAA rulemaking by EPA during the Obama administration has caused grave concern in Texas for numerous reasons. … The underlying themes in EPA rulemaking under the Obama Administration have been the consolidation of increased regulatory power in the Federal Government to the detriment of State authority, and the circumvention of the regulatory authority granted to Congress.” 

The Honorable Travis Kavulla, President of the National Association of Regulatory Utility Commissioners and Vice Chairman of the Montana Public Service Commission testified on the shift in how and by whom utilities are regulated, specifically as it relates to the Clean Power Plan, stating, “The EPA’s regulation creates a carbon planning function vested in the EPA together with State environmental regulators and governors. This supplants the traditional oversight of utility resource planning by State utility commissions. This step change in the regulation of utilities will have many consequences, some of which are readily apparent and some of which are as yet unforeseen.”

Lynn D. Helms, Director of the North Dakota Industrial Commission, Department of Natural Resources, testified that “the Clean Power Plan and the methane rules are going to interfere directly with North Dakota’s plan for reducing its gas flaring by limiting the power that we have available for powering those natural gas processing plants and by changing the configuration of the oil field, requiring us to add three to four times as much pipeline in the ground in order to reach these smaller pads … required under the methane reduction rules.  And so they work exactly counter to the reasonable purpose of reducing flared methane and reducing methane leaks.” 

Charles McConnell, Executive Director, Energy and Environment Initiative, Rice University, testified that “[t]he cascade of environmental rules we have seen during this Administration has weakened energy sustainability.”

Chairman Whitfield added, “Ultimately, it will be up to Congress to ensure EPA stays in its statutory lane for environmental standard setting. It will be up to Congress to take a holistic look at the statutes that govern our energy and electricity markets, and energy policy – to ensure our laws enable a growing, productive economy.”

“Regulated energy producers, manufacturers, and other job creators don’t get to pick and choose which EPA requirements to comply with – they must meet them all,” noted full committee

Chairman Fred Upton (R-MI). “Many of the regulations on their own threaten jobs and affordable energy in Michigan and areas across the country, but it’s the cumulative effect of regulations that matters most.”

For more on the hearing, including a background memo, witness testimony, and an archived webcast, click HERE.

Legal Notice