Regulating the Upstream Energy Industry: Getting the Balance Right
Natural resources don’t respect state boundaries. Consequently, says Winegarden, states’ energy regulations are among the prime determinants of whether a state benefits from its resource wealth – or lets those benefits accrue to its neighbors.
According to a new study from the Pacific Research Institute, Regulating the Upstream Industry: Getting the Balance Right, the regulatory difference can be worth billions of dollars a year. The difference is even more apparent in the labor market. The unemployment rate in Bradford County, Pennsylvania, has dropped to 5.8 percent and continues to fall. The unemployment rate in Broome County, New York – just a stone’s throw away – has stayed at 8 percent for years.
The PRI study also examines the impact of state regulations on the energy industries of Montana and North Dakota, both of which sit on the Bakken Formation, as well as that of California.
“The energy industry supports thousands of jobs and billions in economic activity,” says Winegarden. “With energy prices as volatile as ever, the risk that ill-conceived state regulations could kill those jobs and that activity is even greater.”