Report: NY’s Ban on Fracking Has Cost State’s Residents Tens of Thousands of Dollars

A new report by The Heritage Foundation shows the economic benefits of hydraulic fracturing (aka fracking) for natural gas.

New York state has had a ban on hydraulic fracturing and horizontal drilling practices since 2010. The ban was strengthened in 2014 by then-Gov. Andrew Cuomo, but the report found that “approximately $11,000 per capita—$27,000 per family—could have been created in New York in the absence of the ban.”

“Americans benefit from oil and natural gas development, and states should welcome it,” Diana Furchtgott-Roth, one of the co-authors of the report and the director of the Center for Energy, Climate, and Environment at The Heritage Foundation, told The Daily Signal.

“Households above the Marcellus Shale in New York state are $27,000 poorer per year because hydrofracturing is banned, but they pay about 25% more in electricity costs than households in Pennsylvania,” Furchtgott-Roth explained. 

Significant parts of southwestern New York and northeast Pennsylvania sit on the Marcellus Shale deposit, which is estimated to contain as much as 500 trillion cubic feet of natural gas. But obstruction policies led by the Democratic governors of New York and Pennsylvania have led to moratoriums on fracking in counties of both states. The moratorium on fracking in the northeastern Pennsylvania counties of Wayne, Pike, and Monroe that has been in place since 2010 is particularly costly because northeast Pennsylvania benefits from having thicker sections of the Marcellus Shale compared with central Pennsylvania. 

The Heritage report compared seven New York counties that sit near the same section of the Marcellus Shale deposit with seven Pennsylvania counties that shared geological similarities with their New York counterparts and did not have a ban on fracking. The counties are also in close physical proximity to each other. 

In addition to the stark loss in [gross domestic product] per capita that occurred from 2002 to 2022, the report found “significant job creation and income growth in Pennsylvania as direct and indirect results of fracking, while New York’s ban led economic opportunities in its rural communities to stagnate.” The study measured data from both before the ban occurred in New York state and after it took effect in 2010.

The report concluded that New York state should end its ban on fracking. 

“Our study shows that Pennsylvania’s Marcellus Shale counties tremendously benefited from shale development. Not only did it lead to economic growth in the region, but it also led to job creation. Almost every measurable economic indicator increased as soon as hydraulic fracturing began. New York state could see similar gains by removing their ban,” Alexander Frei, the other co-author of the report and a senior research associate at Heritage’s Center for Data Analysis, told The Daily Signal.

The new research by Heritage also addressed a variety of potential environmental concerns posed by fracking. For example, the report noted that the Occupational Safety and Health Administration (OSHA) has strict guidelines related to workplace safety when operating drills. It also discussed how natural gas is the cleanest-burning fossil fuel when it comes to greenhouse emissions. 

The revolution in drilling for natural gas in shale first began in the late 1990s and really took off in 2003, when a new drilling technique made much of the gas in the Marcellus Shale deposit accessible for the first time. The new Heritage report also noted additional research that found “new oil and gas production not only benefits the immediate area, but also stimulates wage and business income growth up to 100 miles away from production sites.”

The study dovetails with other research about the economic benefits of natural gas production.  

A previous study by Furchtgott-Roth and Andrew Gray “found that the income of residents in the New York counties above the Marcellus Shale would have seen income growth rates of up to 15% for a given four-year period if the state’s moratorium were lifted.” 

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