Report: Shale Saved West Virginia Consumers More Than $4 Billion Over 10 Years
The Consumer Energy Alliance (CEA) recently released its third Appalachian Basin report detailing the incredible savings consumers have experienced as a result of regional shale development. The CEA report finds that lower natural gas prices – thanks to fracking – saved West Virginians almost $4.3 billion from 2006 to 2016.
Combined with the CEA findings in Ohio and Pennsylvania, these reports show that the Appalachian Basin experienced more than $80 billion in savings during this time period.
In West Virginia, the savings were nearly $1.6 billion for residential consumers and more than $2.7 billion for industrial and commercial consumers.
As CEA’s Midwest Executive Director Chris Ventura explained,
“This report highlights how West Virginia’s families and energy users benefit from the production of West Virginia’s natural resources and the ability to transport that energy through pipeline infrastructure, all of which provides millions of dollars annually to fund our schools, hospitals, roads, and communities. The mining and production of traditional energy resources, like natural gas, have supported communities throughout the state for generations and has been integral in bringing affordable energy to the rest of the country for years. We are pleased to see how lower fuel prices have helped West Virginians save more than $4 billion in the past decade.”
The Mountain State was the United States’ seventh-largest natural gas producer in 2017, contributing 1.6 trillion cubic feet (Tcf) of the nearly 9 Tcf of natural gas produced in the Appalachian Basin that year. And as Ventura explained,
“Fortunately, the benefits from increased production are not just limited to consumer savings; energy development has also increased shale-related industry employment 77.54 percent since 2010, employing nearly 12,000 West Virginians.”
By comparison, the report found that all other West Virginia industries combined only increased employment by 15.74 percent. Business Development Corporation of the Northern Panhandle Executive Director Patrick Ford recently told EID,
“The growth in our GDP and economy has been driven by energy. Natural gas has given a rebirth to the value-added metal, energy, and chemical industry clusters, expanded our transportation logistics and health care industry clusters, cut our unemployment rate in half, attracted over $400 million of private investment, driven up worker pay rates to the highest levels we have seen since 2008, and fueled a construction industry that has our region growing construction jobs faster than other metro area in the country.”
All told, the state had the highest economic growth in the country in 2017 as a direct result of the shale development taking place regionally. As EID recently explained, the numbers pretty much tell the tale, as in 2017 West Virginia saw:
- A 6.84 percent increase in its gross domestic product (GDP)
- A 2.75 percent increase in personal income
- A 1.3 percent drop in its unemployment rate
Further, this increased production has led to record tax revenue, as West Virginia Department of Revenue Deputy Sec. Dave Hardy told Inside Shale last month. Hardy explained that “historic” July state tax revenues were $32 million over budget as a result of record West Virginia Marcellus Shale production and related activities. For a bit of perspective, the state’s budget surplus for the entire previous fiscal year was $36 million.
“[T]he oil and gas industry is huge. … I’ve been here at the Capitol about 19 months now and the whole 19 months I’ve been here, every day I hear from our revenue forecasters about what an impact oil and gas is having on West Virginia.”
West Virginia is a prime example of how game-changing this industry has been for the region. And as more investment dollars flow into the Appalachian Basin for shale development and related activities – the CEA report says pipeline investment in West Virginia alone has been over $16.7 billion – these benefits are only going to get better.