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CO Legislators Reignite Oil & Gas Wars With ‘Wildly Unpopular’ Fracking Ban  

This week several Centennial State Democrats are gearing up to introduce a trio of bills directly targeting Colorado energy producers, threatening to reignite oil and gas wars Governor Polis declared an end to in 2019 when he signed SB-181 overhauling a host of energy sector regulations. 

Two of the three bills seek to introduce severe new operating regulations on the energy sector, but SB-159 is seen by many as the most draconian measure. SB-159 would ban all new fracking permits by 2030, and lay the groundwork for the total elimination of the energy industry in Colorado. 

Fracking Ban Is Wildly Unpopular With Colorado Voters 

Ironically, the bill banning new fracking permits comes amid similar effort by environmental activists to place the issue on the 2024 Colorado state ballot, which activists appear to have paused pursuing while this bill is heard in the legislature. Dan Haley, President & CEO of the Colorado Oil & Gas Association, told The Sum & Substance the bill appears to be a tacit acknowledgement from activist groups that a ban on new permits is “wildly unpopular” with voters: 

“It’s a wildly unpopular idea with Coloradans, which is why I think the activists have turned to legislators to try to pass it … It sends a chilling message to all businesses across Colorado that the Legislature would take steps to phase an industry out.”  

API Colorado also blasted the proposed fracking ban, with Director Kait Schwartz calling it “the most extreme anti-energy proposal in the history of our state”: 

“The sponsors of this bill are doing nothing less than championing the most extreme anti-energy proposal in the history of our state, all the while ignoring the needs of everyday Coloradans who are already struggling with increasing everyday costs, including utility rates.”  

Coloradans have a long history of supporting the oil and natural gas industry. In 2018 Colorado voters rejected Proposition 112, which would have increased mandatory setbacks by double digits. While SB-181 ultimately included similar language when passed in 2019, recent history suggests that Coloradans, including many Democrats, still overwhelmingly oppose policies intended to kill a $48 billion industry that supports over 300,000 jobs. 

This sentiment is also evident in the positions taken by several prominent elected Democrats. AG Phil Weiser declined to endorse the wave of frivolous climate suits sweeping states and municipalities while campaigning for office in 2018, noting natural gas has played an important role in reducing emissions:  

Phil Weiser, speaking at a Colorado Chamber of Commerce debate Thursday, said the case for the climate change litigation has not been made. 

“This is what happens when you do your homework. You ask a basic question like, let me get this straight, our carbon footprint has been reduced by substituting natural gas for coal. How do you sue Exxon for causing climate change?” Weiser responded. “That is a very hard question. I’ve asked it, I haven’t gotten an answer.” 

“And so I’m uncomfortable with that litigation because the case for it hasn’t been made,” he added. 

Sen. John Hickenlooper made a similar point about natural gas’s role in reducing emissions as recently as last October: 

Hickenlooper said natural gas is a short-term way to combat coal use. “A lot of people disagree with that, but at the same time when you replace coal (with natural gas) the reduction in carbon emissions is so dramatic that it’s worth drilling those extra wells,” he said. 

Activists Supporting Fracking Ban Employ Baseless Arguments 

Activists supporting the legislation told the Denver Post on Wednesday a fracking ban was warranted, remarkably, because Colorado is a net energy exporter:  

“Heidi Leathwood, a climate policy analyst with the environmental group 350 Colorado, said in a statement that the oil and gas industry engages in ‘deliberate fear mongering’ to raise concerns about the state’s energy supply. Advocates of phasing out new drilling permits say the state produces nearly four times the natural gas and twice the oil that Colorado uses. 

Colorado is among the country’s top 10 states in oil and gas production, according to the U.S. Energy Information Administration.” 

Unfortunately that fallacy went unchallenged by the Post, as noted by Garrett Golding, an Energy Economist with the Dallas Federal Reserve: 

Restricting energy exports, particularly from a state like Colorado with some of the strongest environmental regulations in the nation, only guarantees petroleum produced elsewhere will be supplied to neighboring states to meet demand. 

Moreover, as Schwartz pointed out in a release responding to the bill, Americans overwhelmingly support domestic production to ensure energy security:  

Recent polling indicates that 88 percent of voters believe it is important to produce natural gas and oil here in the United States, while 85 percent agree that producing natural gas and oil domestically helps make our country more secure against actions by countries such as China and Russia.” 

The assumption existing Colorado production will satisfy future in-state demand is equally flawed.  

According to COGA, oil and gas production will fall precipitously once a ban is instituted due to the fact that most production occurs over the first two years of well completion, making it far from certain existing production would be sufficient to meet future Colorado energy needs. In addition to jeopardizing the availability of energy for consumers, a ban could also put taxpayers on the hook for depleted land values, as Haley told the Sum & Substance: 

“While wells can operate for 30 years, their highest production occurs in their first 18 months, meaning the industry would begin an irreversible decline within two years of such a ban. That also would set the state up for massive lawsuits from property owners who could argue that its actions amount to a taking of the value of their land if they can’t use its resources.” 

Many industry and legal experts in California have recently expressed similar concerns about Gov. Newsom’s proposed fracking ban, with the Wall Street Journal arguing the state could be forced to pay damages to affected property owners should the CA ban go into effect later this year.     

Potential Bipartisan Opposition 

All eyes turn now to the Colorado Senate Agriculture & Natural Resources Committee, chaired by State Sen. Dylan Roberts. Roberts, whose district includes several mountain communities across the Western Slope, is seen by some as the key figure who could determine whether the bill advances. 

According to the Denver Post Gov. Jared Polis was not consulted on this legislation, potentially indicating the bill may not have universal support among state Democrats:  

“The governor wasn’t consulted on the legislation and hasn’t reviewed it, spokeswoman Shelby Wieman said in an email.” 

While Gov. Polis has a famously mixed record when it comes to fracking bans, in recent years he has sought to downplay oil and gas fights after signing SB-181 in 2019. Even current Biden EPA Region 8 Administrator KC Becker, then CO State House Speaker, said in 2020 further “ballot initiatives weren’t needed” and the state needed to focus on implementing SB-181.  

BOTTOM LINE: Coloradans across party lines overwhelmingly oppose banning fracking, and if history is any indication, the renewed effort to destroy a $48 billion industry that supports over 300,000 jobs will be resoundingly rejected by the general public, and meet a swift end in the General Assembly.  

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