House Republicans Plan: $55 Million Stimulus For Natural Gas Demand
House Republicans Plan: $55 Million Stimulus For Natural Gas Demand
Includes State Grants, Tax Credits, Conversion Of State Fleet
By ERIC BOEHM
A new plan backed by House Republicans would spend $55 million in the hopes of generating more demand for the natural gas produced in Pennsylvania.
The proposal, unveiled September 21 by state Rep. Stan Saylor, R-York, the House Republican Policy Committee chairman, would transition the state’s 16,000 vehicle fleet to run on natural gas instead of gasoline, while also providing tax breaks for private businesses to do the same with their vehicles.
The estimated cost to convert the entire state vehicle fleet to run on natural gas is $10 million, while the tax credits for businesses would cost $30 million.
The package also includes a $15 million grant program to encourage municipalities to convert their vehicle fleets to natural gas as well.
“Pennsylvania has an abundant supply of clean natural gas,” said Mr. Saylor. “By creating incentives to use that natural gas, we will increase demand and as a result, we will help create thousands of jobs not only in the natural gas industry, but also in related fields like the infrastructure, manufacturing, and service sectors.”
To provide fuel for the state fleet and other natural gas vehicles, the legislation would also mandate the construction of natural gas fueling stations along the length of the Pennsylvania Turnpike, for an unknown cost.
The conversion to cleaner-burning natural gas would cut the environmental impact of the state’s fleet, while also reducing Pennsylvania’s dependency on foreign oil, said Mr. Saylor.
Brett Marcy, spokesperson for House Majority Leader Todd Eachus, D-Luzerne, said it was neither practical nor fiscally responsible to ask for a sweeping transformation of the vehicle fleet when the state faces a potential $5.5 billion budget deficit next year.
“If they are serious about creating jobs and helping Pennsylvania’s taxpayers, they will support a reasonable extraction tax on these hugely profitable natural gas companies,” said Mr. Marcy.
Mr. Saylor said the costs of the program would be covered by the taxes paid by the gas industry in the state - without the addition of a natural gas severance tax, which is currently under consideration by the General Assembly.
“The Marcellus Shale industry produced $389 million in state and local tax revenue in 2009 alone,” Mr. Saylor said. “Our plan would use a portion of that revenue to create thousands of jobs.”
A key component of the plan is the construction of natural gas fueling stations along the turnpike to encourage the use of natural gas by trucking companies which use the turnpike to cross the state.
“We have a lot of trucking companies that are based out of Pennsylvania, so this is an opportunity for that to happen,” said Mr. Saylor. “We will be working with the federal government in their programs to provide those incentives.”
Taking a tractor trailer from New Jersey to Ohio along the Pennsylvania Turnpike costs about $200 in fuel, though the amount will vary slightly depending on the size and weight of the load carried, according to Nancy Wilkes, communications director for the Pennsylvania Motor Truck Association (PMTA).
Using natural gas, which costs about a dollar less per gallon than gasoline, the same truck would have to spend about $125 to cross the state on the Turnpike.
Ms. Wilkes said the PMTA supports the research and exploration of natural gas as a replacement to diesel fuel, but the high cost of transitioning trucks to run on natural gas has been prohibitive. Even with natural gas fueling stations built along the Pennsylvania Turnpike, unless other states adopt similar policies, it is unlikely interstate trucking firms would want to convert their fleets to run on natural gas.
“All that said, every little step is a good one towards better efficiency and less dependency on traditional fossil fuels,” said Ms. Wilkes.
The proposal, unveiled September 21 by state Rep. Stan Saylor, R-York, the House Republican Policy Committee chairman, would transition the state’s 16,000 vehicle fleet to run on natural gas instead of gasoline, while also providing tax breaks for private businesses to do the same with their vehicles.
The estimated cost to convert the entire state vehicle fleet to run on natural gas is $10 million, while the tax credits for businesses would cost $30 million.
The package also includes a $15 million grant program to encourage municipalities to convert their vehicle fleets to natural gas as well.
“Pennsylvania has an abundant supply of clean natural gas,” said Mr. Saylor. “By creating incentives to use that natural gas, we will increase demand and as a result, we will help create thousands of jobs not only in the natural gas industry, but also in related fields like the infrastructure, manufacturing, and service sectors.”
To provide fuel for the state fleet and other natural gas vehicles, the legislation would also mandate the construction of natural gas fueling stations along the length of the Pennsylvania Turnpike, for an unknown cost.
The conversion to cleaner-burning natural gas would cut the environmental impact of the state’s fleet, while also reducing Pennsylvania’s dependency on foreign oil, said Mr. Saylor.
Brett Marcy, spokesperson for House Majority Leader Todd Eachus, D-Luzerne, said it was neither practical nor fiscally responsible to ask for a sweeping transformation of the vehicle fleet when the state faces a potential $5.5 billion budget deficit next year.
“If they are serious about creating jobs and helping Pennsylvania’s taxpayers, they will support a reasonable extraction tax on these hugely profitable natural gas companies,” said Mr. Marcy.
Mr. Saylor said the costs of the program would be covered by the taxes paid by the gas industry in the state - without the addition of a natural gas severance tax, which is currently under consideration by the General Assembly.
“The Marcellus Shale industry produced $389 million in state and local tax revenue in 2009 alone,” Mr. Saylor said. “Our plan would use a portion of that revenue to create thousands of jobs.”
A key component of the plan is the construction of natural gas fueling stations along the turnpike to encourage the use of natural gas by trucking companies which use the turnpike to cross the state.
“We have a lot of trucking companies that are based out of Pennsylvania, so this is an opportunity for that to happen,” said Mr. Saylor. “We will be working with the federal government in their programs to provide those incentives.”
Taking a tractor trailer from New Jersey to Ohio along the Pennsylvania Turnpike costs about $200 in fuel, though the amount will vary slightly depending on the size and weight of the load carried, according to Nancy Wilkes, communications director for the Pennsylvania Motor Truck Association (PMTA).
Using natural gas, which costs about a dollar less per gallon than gasoline, the same truck would have to spend about $125 to cross the state on the Turnpike.
Ms. Wilkes said the PMTA supports the research and exploration of natural gas as a replacement to diesel fuel, but the high cost of transitioning trucks to run on natural gas has been prohibitive. Even with natural gas fueling stations built along the Pennsylvania Turnpike, unless other states adopt similar policies, it is unlikely interstate trucking firms would want to convert their fleets to run on natural gas.
“All that said, every little step is a good one towards better efficiency and less dependency on traditional fossil fuels,” said Ms. Wilkes.
PA Independent
Buck
Views: 14
Replies to This Discussion
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Permalink Reply by CypressKnees on -
Oh, no! Socialized Gas?
Did you listen to the NPR story on the Marcellus a couple of days ago ? It said some interesting things about tax incentives. I didn't understand it myself. You certainly would, though, due to your brains. The story is available on GoMarcellusShale. The concern is over-drilling now or something like that. Please interpret, if you have time. Many thanks.
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Permalink Reply by Checkmateking on
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Sounds like, better than creating 11 jobs with a hundred million in L.A.
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