A new bill, sponsored by Assemblywoman Lupardo and Senator O’Mara, is aimed at creating a Task Force that would come up with a report that would envision using any natural gas produced from the Marcellus Shale within NYS.  A2914 (same as S4793)  is addressing a little-discussed aspect of any proposed natural gas boom: if the gas is shipped directly to the Port of NYC area, liquified, and shipped overseas, NYS economies will see little multiplier effect from forward industrial linkage.  There is a world price for liquified natural gas, and the commerce clause of the US constitution as well as WTO rules prohibit export tariffs, so, it is not possible to limit gas production in the state to sale within the state.

What could the task force to be formed by this bill write about in their report, if limiting or prohibiting sales outside the state is not allowed?  The memo suggests that they would focus on delineating “opportunities” to use the gas in-state, such as manufacturing.  As tax-abatement economic development programs are generally allowable under the commerce clause of the Constitution and WTO rules, it is likely that such economic development programs would be the focus of the task force’s work.  The “opportunities” for forward-linkages to manufacturing and other gas-using industries would be traced, and the policymakers would have a map by which to design tax-abatement programs to “stimulate” the development of such linkages.

No comparison to potential economic impact from the development of other sources of energy are considered in the bill.  This is a bill to watch, because it has sponsorship from Marcellus region legislators in the majority in each of the houses of the legislature.

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