A divided Pennsylvania Supreme Court invalidated portions of a law designed to encourage economic development through hydraulic fracturing (commonly known as “fracking”).  Robinson Township v. Pennsylvania Public Utility Commission (December 19, 2013).  The case involved challenges to a recently-enacted commonwealth law known as “Act 13,” which was intended to promote energy projects involving fracking by streamlining regulation on a state-wide basis.

By a 4-2 vote, the Court struck down two elements of the act as violating the Pennsylvania constitution, although the justices divided on which provision was violated and no one position achieved a majority.  The justices remanded several more issues to the lower court, including whether the entirety of Act 13 should be struck down as non-severable from the unconstitutional portions.  The decision, which applies only to Pennsylvania and relies on language unique to the Pennsylvania constitution, does not ban fracking but merely restores the status quo where localities were permitted to regulate the fracking process through zoning ordinances.

While Act 13 modified the commonwealth’s oil and gas regulations regarding fracking in several ways, two provisions were at the center of the controversy.  The first prohibited municipalities from using zoning laws or other local ordinances to regulate fracking, and instead required that these ordinances match statewide regulatory standards.  The second required the Pennsylvania Department of Environmental Protection (“PaDEP”) to grant waivers to oil and gas well permit applicants from certain statutory environmental protections, and set the standard through which the Department could impose additional environmental restrictions on permittees.

A plurality opinion by Chief Justice Castille, joined by Justices Todd and McCaffery, held that these provisions violated Pennsylvania’s Environmental Rights Amendment.  That amendment requires that the state act as a “trustee” of state natural resources, both tangible and esthetic (this “trustee” language is unique to Pennsylvania and so the court’s reasoning will likely have limited impact on challenges to fracking policies in other states).  The plurality held first that all organs of Pennsylvania government, including local municipalities, had this trusteeship obligation to protect the environment.  They then concluded that Act 13 interfered with these obligations by requiring municipalities to adapt a single, statewide regulatory regime with respect to fracking, regardless of any local circumstances that may make these policies inappropriate.  While Chief Justice Castile’s plurality opinion states without citation that both hydraulic fracturing and horizontal drilling “inevitably do violence to the landscape” (page 8), neutral academic observers actually conclude that the environmental effects of fracking are minimal compared to other energy sources and that “fracking is good not only for the economy but also for the global environment.”

The plurality also concluded that the statewide policies did not adequately account for local differences.  The statute gave an automatic waiver from many environmental protection requirements to any fracking operator who presented a “plan” for mitigating environmental impacts.  While PaDEP was allowed to impose conditions on the permit “necessary” to protect the environment, the statute provided no guidance on what made a condition “necessary,” and was not required to consider or respond to municipal suggestions on this issue.  Finally, while a permittee who felt that its permit conditions were too strict was allowed to appeal PaDEP’s decision, municipalities and citizens who believed the permit did not contain conditions necessary to protect the environment had no right of appeal.  Moreover, if the permit was appealed the burden of proof was on PaDEP to demonstrate that the conditions it imposed were necessary to protect the environment.

While he reached the same result, Justice Baer’s concurrence did not rely on the Environmental Rights Amendment but on the Pennsylvania Constitution’s due process protections.  Justice Baer concluded that the due process rights of homeowners to guard against intrusions by others upon their property is context-specific and could not be reconciled with the statewide standards of Act 13.  Justices Saylor and Eakin filed separate dissents that would have upheld Act 13 in its entirety.

The decision does not foreclose all state efforts to promote fracking (and certainly does not ban fracking outright), but it does place limits on attempts by the Commonwealth of Pennsylvania to create a uniform set of regulations regarding fracking.  Following the decision, local municipalities can regulate fracking in much the same way that they make other zoning decisions, but probably could not arbitrarily forbid fracking outright without paying gas lease holders just compensation.  Opposition to fracking is localized in only a few areas of the commonwealth, and it is anticipated that many municipalities will not impose any additional regulation.