By Cyrus Reed
GOVERNANCE
Change the Railroad Commission’s (RRC) name and address the appearance of conflicts of interest remain critical to ensuring transparent and effective regulation.
Recommendation 1: Establish the Texas Energy Resources Commission, governed by a full-time appointed board, to assume the regulatory role currently served by the Railroad Commission, and continue the agency for 12 years.
Recommendation 2: If there is no decision to change the RRC from an elected to an appointed body, we recommend the following changes in election and campaign finance laws:
- Limit contributions to $2,500
- Limit timing of contributions to election season
- Mandatory disclosure of all contributions
- Resign-to-run provision for Commissioners
- Prohibit Commissioners from accepting contributions from people who have pending matters before the RRC
TRANSPARENT AND ROBUST
The agency should be transparent, enforcement should be robust, and industry should pay their fair share.
- Agency should be self-funded through fees and fines
- Permit fees must reflect the work of the agency - $100 for a commercial wastewater disposal permit is ridiculous
- Self-bonding requirements must be increased from an average of 17% of well clean-up to at least 50% of average well clean-up
- Creation of a new clean-up fund for fracking through a per-barrel fee of oil and per-cubic foot of gas fee
- End or limit the high-cost severance tax for fracked wells, and eliminate the practice of claiming to be a gas well to avoid the oil well severance tax
- Adoption of a more robust penalty policy and penalty guidelines as rules that actually deters future violators and hit repeat violators where it hurts
- Raise maximum penalties that can be assessed from the currently outdated $10,000 maximum to $25,000 per violation per day - current with EPA, TCEQ, and Attorney General levels
- As part of its enforcement policy, the economic benefit of noncompliance that the law-breaker gains should be considered. We would support language such as “The penalty should exceed the economic benefit of noncompliance gained by the entity violating a law, rule or regulation."
- Specific language requiring the RRC to post basic information on its website on permits, license, enforcement, and compliance
- Searchable database by company, county, and permit to review compliance and enforcement data
- Complaint database that follows individual complaints and reports how they were resolved
- Procedures requiring guidelines for how the Commission must respond to complaints
- Require the RRC to gather and provide information on oil and gas water use to the Texas Water Development Board as part of their Texas Water Plan
- Clarify role of cities, groundwater districts, and counties in enforcement so they can enforce RRC rules, including subsurface completion inspections to ensure safety in urban and suburban areas (deputize the cities, groundwater districts, and counties through MOUs)
III. SAFEGUARD THE PUBLIC
The mission of the RRC should be expanded to directly safeguard the public and private property rights from the impacts of energy resource extraction. Grant the Railroad Commission more authority to enforce and regulate the following areas:
- Flaring and venting
- Noise
- Lighting
- Spills of toxic produced water and flow-back wastewater
- Accurate spill response requirements and reporting of spills of wastewater
- Required leak detection and repair programs through MOU with TCEQ
- Emissions from fracking that can affect air quality during completion process and MOU with TCEQ
- Safety standards and prevention of damage regulations for both interstate and intrastate pipelines
- Better protection for consumers on “pooling” practices
- Specific authorization for the RRC to regulate pipelines related to fracking, including those related to fracking waste
- Better rules on injection wells – including seismicity, notice, groundwater protection, and waste pits – including considering impacts of traffic and fumes and requiring they be safe for 100-year-flood
- Beefed-up inspection and safety requirements for pipelines in densely populated areas
- Specific and improved bonding authority for fracked wells
- Specific authority to require gas companies to offer gas efficiency and conservation programs
IV. LET NON-ESSENTIAL FUNCTIONS GO
- In-situ uranium exploratory mining should be transferred from the RRC to the TCEQ
- SOAH should be used in contested enforcement cases, not internal judges
- Natural gas tariff and rate decisions should be transferred to the PUC, and OPUC should represent the residential and small consumer on these issues
- Regulation of coal combustion waste should be transferred to TCEQ