Options for Regulating the Environmental Impacts of Hydraulic Fracturing

• Date: 01 August 2015

45 ELR 10752 ENVIRONMENTAL LAW REPORTER 8-2015

C O M M E N T

Options for Regulating the

Environmental Impacts of

Hydraulic Fracturing

by Leslie Carothers

Leslie Carothers is a Visiting Scholar at the Environmental Law Institute.

The exploitation of shale gas and oil reserves by

hydraulic fracturing and horizontal drilling has

transformed the U.S. energy industr y, bringing

desired economic development and greater energy inde-

pendence for the United States but also new environmental

challenges in the states where the resource is abundant. e

technique of hydraulic fracturing involves pumping water

containing various materials and chemicals into shale

formations at high pressure to crack the rock and release

the ga s a nd oil contained in it. Combined with horizon-

tal drilling , hydraulic fracturing opens huge shale deposits

in the U.S. to production of gas and oil where recovery

was not practical before.1 Environmental law practitioners

and academics are devoting signicant attention to the

demands of representing the actors in the industry a nd to

examining the extent to which the existing environmental

regulatory framework for the oil and gas industry is equal

to the task of responding to the risks presented by the rapid

adoption of a novel technology. e ELI-Vanderbilt Law

School Environmental Law and Policy Annual Review

identies outstanding academic work in the eld of envi-

ronmental law. e reviewers selected two excellent articles

on the challenges of hydraulic fracturing (fracking for

short) to the regulatory system for presentation and discus-

sion at the 2015 program on Capitol Hill: David A. Dana

and Hannah J. Wiseman, A Market Approach to Regulating

the Energy Revolution: Assurance Bonds, Insurance, and the

Certain and Uncertain Risks of Hydraulic Fracturing,2 and

omas W. Merrill and David M. Schizer, e Shale Oil

and Gas Revolution, Hydraulic Fracturing, and Water Con-

tamination.3 Both articles address many of the common

1. See E. L I.  W  J C C. 

E P  M., G  B W  B:

G S P T S G D-

 4 (2014), available at http://www.eli.org/research-report/getting-

boom-without-bust-guiding-southwestern-pennsylvania-through-shale-gas-

development [hereinafter ELI and W&J Report].

2. David A. Dana & Hannah J. Wiseman, A Market Approach to Regulating the

Energy Revolution: Assurance Bonds, Insurance, and the Certain and Uncertain

Risks of Hydraulic Fracturing, 99 I L. R. 1523 (2014).

3. omas W. Merrill & David M. Schizer, e Shale Oil and Gas Revolution,

Hydraulic Fracturing, and Water Contamination: A Regulatory Strategy, 98

issues raised about the strengths and weaknesses of the cur-

rent and potential alternative regulatory approaches, while

emphasizing dierent but not mutually exclusive solutions.

is comment will focus primarily on the approaches to

setting regulatory standards and securing compliance by

the key actors in the cycle of production a nd site resto-

ration. It concludes with a comment on the problem of

cumulative impacts of fracking on landscapes, an issue

receiving less attention in the articles, and t he importance

of maintaining local land use authorities to contend with

those impacts.

By way of background, the oil and gas industry has his-

torically been regulated by state agencies, either specialized

oil and gas agencies or—more commonly in the eastern gas

producing states—by environmental agencies. At the fed-

eral level, the Interior Depart ment has a role like the state

oil and gas commissions in regulating gas and oil explora-

tion and production on federal la nds, Indian reservations,

and o shore waters. e Department has recently issued

regulations for hydraulic fracturing on federal lands, an

action challenged by some representatives of the oil and gas

industry on the ground that the agency should defer to the

requirements in the states where the federal lands are locat-

ed.4 e Interior Department, like the state agencies, has

been subject to criticism that as an agency with the mis-

sion both to promote and to regulate energy production, it

has been less tha n alert to new risks, as in the case of the

deep ocean oil drilling involved in the Deepwater Horizon

spill.5 e U.S. Environmental Protection A gency (EPA)

is a regulatory agency with no mission to promote energy

development, but EPA has limited statutory authority to

regulate oil and gas operations. e agency regulates air

quality impacts like methane emissions6 and underground

injection of production wastes. However, other major

M. L. R. 145 (2013).

4. See Carol Davenport, New Federal Rules Are Set for Fracking, N.Y. T,

Mar. 21, 2015, at A-10. Tradition aside, there appears to be no current legal

basis for an objection to the Interior Department’s regulation of oil and gas

development on federal lands.

5. Dana & Wiseman, supra note 2, at 1553.

6. Merrill & Schizer, supra note 3, at 169-70.

Copyright © 2015 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.