California recently established the most stringent energy-extraction restrictions in the nation. As the CEO of a natural gas firm, you probably think I opposed these rules.
You’d be wrong.
In fact, California’s new law is a welcome step in the evolution of the American energy market. The state’s smart rules are eliminating regulatory uncertainty and establishing a legal foundation for future exploration and extraction. Other energy-rich states should follow suit.
Hydraulic fracturing or “fracking” has enabled access to vast oil and gas reserves. The Energy Information Administration estimates California’s 1,750-square-mile shale formation could bear up to 64 percent of our nation’s shale oil reserves. This legislation opens up California’s colossal resource for responsible exploration, setting an example for other states.
California will now require energy companies to obtain permits before fracking and disclose fracking chemicals and their environmental impacts. Thanks to these rules, California could soon become America’s biggest oil producer. Keep in mind the United States is on track to become the world’s biggest oil producer by 2015.
Fracking will create 2.8 million jobs by 2020, according to an estimate by the University of Southern California. These opportunities won’t only be for the highly educated. Entry-level energy jobs can pay $80,000 a year or more and often require only a high school diploma.
Other states can reap similar rewards by passing similar rules. Current state fracking laws vary erratically. Kansas has no laws. Pennsylvania has strict ones. New York has imposed a temporary fracking moratorium. Vermont and New Jersey outright forbid the practice. Energy investors are scared off by this inconsistency. And they’re worried about fracking regulations being based on rumors rather than good science.
Written By: Chris Faulkner