On September 9, the Financial Times reported that Southwestern Energy, a Houston-based company drilling in West Virginia, contracted to sell certified “responsible gas” to a utility company called New Jersey Resources. The utility paid a premium to get a green stamp of approval on their supplies. The cost is fairly minimal, adding up to about 90 cents per month to the bill for each of the utility’s customers.
The deal was facilitated by the Independent Energy Standards Corporation (IES). The company created what it calls the TrustWell rating system, which sets a standard for responsible gas development. IES looks at four categories of environmental impacts: water, air, land, and community. The company evaluates a producer on a number of criteria and then assigns a rating between zero and 150. The ratings system appears to be complex, and somewhat secretive. It addresses issues like emissions, methane leaks, well integrity, water sourcing, and community engagement. IES does not explain how these factors are scored, though.
The ratings system is not intended to replace regulation, but groups like the Environmental Defense Fund participated in developing the standard in hopes that natural gas customers will demand higher standards than regulators.
Though widely shown to be safe, “fracking” has certainly developed a poor reputation with many people. Europeans, in particular, have been very resistive to “fracked gas.” Natural gas exporters have been working hard to develop standards that will make other countries more comfortable buying American gas. Russia has traditionally dominated the natural gas market in Europe, though, so Europeans are often going to take the cheapest gas available despite environmental and geopolitical concerns.
Natural gas production in the Marcellus region is booming, and American gas is already threatening the dominance of other producers, like Russia. Cimmaron Land helps companies secure the right to explore and produce in the Appalachian region, and you can call us at 412-212-7517 if you are interested in more information.