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The Public Utility Commission published notice in the February 1 PA Bulletin setting Calendar Year 2024 Act 13 Drilling Impact Fees based on a formula set in law. The fees will be the same as in 2023.
The fees will be--
Year of Well Horizontal Vertical—Producing
Year 1 $51,800 $10,400
Year 2 $40,200 $8,000
Year 3 $34,500 $6,900
Year 4—10 $17,200 $3,400
Year 11—15 $5,600 N/A
Dramatic Decline In Support By Shale Gas Industry
The decline of shale gas drilling caused by generally lower natural gas prices have resulted in a dramatic decline in revenue from the Act 13 drilling impact fee.
The Independent Fiscal Office estimates Act 13 fee revenue from 2024 fees are estimated to be $163.8 million, down from $179.6 million in 2023 and down from the record $278.9 million in 2022. Read more here.
That’s a drop of $214.4 million in shale gas industry support since 2022.
This decline in revenue leaves significant holes in state, county and municipal budgets around the state.
A report last September by the Pittsburgh-based Allegheny Institute for Public Policy published a policy brief on the steep decline in revenues from the Act 13 shale gas impact fees going to counties and municipalities saying they need to "begin lowering their expectations" on support from the shale gas industry. Read more here.
Gas Infrastructure Continues To Grow
Shale gas infrastructure continues to grow all across Pennsylvania-- more wells, more gas and wastewater pipelines, compressor stations, natural gas processing facilities, water withdrawals and other facilities.
Most need to be inspected and regulated by DEP and the PUC, some aren’t regulated.
There were 735 new shale gas wells drilled in 2023 and 2024, bringing the total number of shale gas wells subject to the Act 13 impact fee to 12,050, according to the Independent Fiscal Office.
Visit the PUC Act 13 Impact Fee webpage for more information on the fee and disbursements.
PA Oil & Gas Industry Public Notice Dashboards:
-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - February 1 [PaEN]
-- DEP Posted 89 Pages Of Permit-Related Notices In February 1 PA Bulletin [PaEN]
Related Articles This Week - Natural Gas:
-- PUC: Calendar Year 2024 Act 13 Drilling Impact Fees To Remain Same As 2023; Dramatic Decline In Financial Support From Shale Gas Industry Continues [PaEN]
-- Range Resources And MarkWest Liberty Midstream File Legal Challenges To The 2,500 Foot Shale Gas Facility Setback Ordinance Adopted By Cecil Township, Washington County [PaEN]
-- Conventional Oil & Gas Industry Compliance With 2022 DEP Methane Reduction Regulation Put On Hold Pending Outcome Of Litigation [PaEN]
-- DEP Releases 2 Contracts For Bidding In Next Round Of Conventional Oil & Gas Well Plugging: 12 Wells In Kinzua State Park, McKean County, 18 Wells In Warren County [PaEN]
-- Rep. Vitali Introduces Bill To Restore DEP Authority To Increase Conventional Oil & Gas Well Plugging Bonds To Prevent Hundreds Of New Well Abandonments A Year [PaEN]
-- PA Republican Senator To Introduce Bill Suspending State Taxes On Natural Gas Producers; Cut DEP Permit Fees; End Drilling Moratorium On DCNR Lands; Exempt Coal-Fired Power Plants From EPA Regulations [PaEN]
-- DEP Invites Comments At March 5 Hearing On Title V RACT 3 Air Quality Permit For Hazleton Generation Natural Gas Power Plant In Luzerne County [PaEN]
-- Gov. Shapiro Proposes ‘Lightning’ Energy Plan To Increase & Diversify Energy Generation; Reduce Climate Changing Pollution; Lower Energy Costs; Create Jobs [PaEN]
-- Gov. Shapiro Reaches Agreement With PJM To Prevent Unnecessary Price Hikes And Save Consumers Over $21 Billion On Utility Bills [PaEN]
-- PA Senate Republican Leader: ‘Every Consumer Of Electricity In This Commonwealth Is Going To Pay More;’ ‘What You’re Going To Face Is Going To Be Really Unpleasant’ [PaEN]
-- Republicans On PA Senate Environmental Committee Report Out Bills To Eliminate Carbon Pollution Reduction Program Covering Power Plants, Establish Independent Energy Office [PaEN]
-- Inquirer: President Wants US To Be ‘Leading’ Producer Of Non-Fuel Minerals; Here’s How PA Could Help; Rare Earth Elements Could Be More Important Than Expansion Of Fracking [PDF of Article]
NewsClips:
-- The Energy Age Blog: Range Resources & MarkWest Liberty Midstream File Legal Challenges Against 2,500 Foot Shale Gas Setback Ordinance In Cecil Twp., Washington County
-- The Energy Age Blog: EQT Should Plug These Abandoned Conventional Wells In Peters Twp., Washington County Before Fracking From Mingo Well Pad
-- PennLive Guest Essay: Natural Gas Industry Operations [Wastewater Pipelines] Are Strongly Regulated In PA - By Marcellus Shale Gas Coalition [Shale Gas Wastewater Pipelines are NOT regulated by the PUC for construction, operations and safety. Read more here. ]
-- Inquirer: President Wants US To Be ‘Leading’ Producer Of Non-Fuel Minerals; Here’s How PA Could Help; Rare Earth Elements Could Be More Important Than Expansion Of Fracking [PDF of Article]
-- NYT: Oil, Gas Companies Embrace New President, But Not ‘Drill, Baby, Drill’ [No Plans To Increase Production Unless Prices Rise Significantly]
-- US EIA: Electric Power Sector Has Driven Rising PA Natural Gas Consumption Since 2013
-- UGI Gas Division Filed A Request With PUC To Increase Residential Gas Rates By 10.8%
-- Scranton Times: UGI Seeking To Raise Natural Gas Rates 10.8% For Residential Customers
-- Utility Dive: Calpine To Sell 2 PA Gas Power Plants To Avoid Market Power Concerns From Constellation Merger
-- Reuters: Diversified Energy To Buy Permian Basin Oil & Gas Producer Maverick In $1.3 Billion Deal [Diversified Specializes In Buying Old Wells]
-- Bloomberg: US Natural Gas Producers Likely To Gain Asian Market Share [China Buying 50% More US LNG, Cap Price At $10 - Currently $3.89]
-- Bloomberg: Europe’s Gas Traders Now Fear Summer More Than Winter
-- Reuters: Venture Global Given FERC OK To Start Up Another Louisiana LNG Gas Export Plant
-- Reuters: US EIA Sees 7% Higher US Wholesale Power Prices In 2025; Residential Increase Of 2%
-- Wall Street Journal: New Federal Administration Memo Orders Agencies To Broadly Pause All Federal Grants, Loans, Financial Assistance Programs Pending Review [PDF of Article]
-- AP: Federal Judge Temporarily Blocks New Administration’s Freeze On Federal Grants And Loans
-- AP: President Rescinds Memo Freezing Federal Money After Widespread Confusion; Executive Orders Requiring Funding Review Still In ‘Full Force’
-- E&ENews/Politico: EPA Freezes Federal Solar For All Program Funding Until Further Notice [PA Due To Receive $156 Million]
-- Financial Times: President Wiped Out Dozens Of Biden’s Climate Initiatives In First-Week Blitz
-- Inquirer: Escalating Demand And Diminished Supply Has Spiked PUC Concern About The Future Ability Of State’s Electric Grid
-- Post-Gazette Guest Essay: Transformational Investments In Renewables, Energy Efficiency Are Designed To Lower Energy Costs For Pennsylvania Consumers - By Molly Parzen, Conservation Voters Of PA
[Posted: January 31, 2025]
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