capital blight

By Jon Hurdle - Inside Climate News, August 23, 2023

Natural gas production in the Appalachian region of the United States has failed to produce promised increases in jobs and income since the fracking boom began there in the late 2000s, with economic stagnation likely to persist now that output of the fuel has passed its peak, according to a report issued on Tuesday.

The study from the Ohio River Valley Institute, a nonprofit research group, found that gas-producing areas of Pennsylvania, Ohio and West Virginia lost more than 10,000 jobs from 2008 to 2021 and that their personal income growth trailed that of the three states and the U.S. as a whole. Their population dropped by more than 46,000 during the period.

Even though gross domestic product of the 22-county region surged at four times the rate of the states overall from 2008 to 2019, little of that new wealth helped local economies because natural gas investment is mostly made in capital, not labor, and because many of the industry’s workers came from distant areas like Texas or Oklahoma where oil and gas skills were more readily available, the report said.

“GDP, which is often cited as a principal barometer of economic health, failed to produce commensurate gains in local measures of prosperity and well-being, including job, income and population growth,” it said.

By Sean O'Leary - Ohio River Valley Institute, August 22, 2023

By the first quarter of 2020, EQT Corporation, the nation’s largest domestic producer of natural gas, was supplying more than 4 billion cubic feet of natural gas per day. Just a decade earlier, EQT’s output wasn’t even one-tenth as much and the company ranked an undistinguished 25th for output among US producers. But EQT had the good fortune and foresight to base all of its operations in Appalachia, which made it the greatest beneficiary of what turned out to be the world’s richest natural gas field. 

In those early days of 2010, when EQT was the scuffling little guy trying to find a place among giants, such as ExxonMobil, the company employed just 1,815 people. But, by 2020, when EQT’s production had surpassed that of ExxonMobil and all others, its employee count mushroomed to . . . 624.

Yes, EQT’s head count actually declined by nearly two-thirds between 2010 and 2020. In fairness, some of EQT’s job reduction was attributable to its spin-off of Equitrans Midstream (EQM) in 2018. But, even if you add EQM’s 2020 head count to EQT’s, combined employment at the two companies was only 1,395 in 2020, still a quarter smaller than EQT’s workforce in 2010.

EQT’s tale of skyrocketing output accompanied by a shrinking workforce helps us understand important things about the shale gas industry. It helps explain why, as the Ohio River Valley Institute documented in 2021, the Appalachian natural gas boom failed to deliver what had been expected to be hundreds of thousands of new jobs for the region. And it demonstrates that as the natural gas industry matures, it becomes less jobs-intensive and its already meager contributions to economic development and prosperity become even fewer. The dynamic is simple. As a larger share of output comes from existing wells and fewer new ones are dug and work is completed on the construction of processing plants and pipelines, fewer workers are needed. 

Consequently, if production stagnates and the only need for new wells is to replace those that retire, the economic value of the gas industry to Appalachia may diminish even further. And if the Energy Information Administration is correct in its most recent forecast for domestic natural gas production between now and 2050, that is exactly the scenario Appalachia and its natural gas industry are facing.

According to the EIA’s “Annual Energy Outlook 2023”, Appalachian natural gas production likely peaked in 2022. Although this year’s events may prove that forecast to be incorrect in the short term, the long-term trend is clear. Production is leveling off. Indeed, data show that Appalachian production began to plateau as early as 2019. And, as this report will show, economic outcomes in the 22 counties in Ohio, Pennsylvania, and West Virginia that are responsible for 90% of Appalachian gas production deteriorated even further since 2019, which was the last year examined in ORVI’s original study of the Appalachian natural gas boom’s economic impacts in the counties where it is concentrated – an area christened “Frackalachia.”

Download a copy of this publication here (PDF).

By Kim Kelly, Union Jake and Adam Keller - The Valley Labor Report, August 16, 2023

Kim Kelly, labor journalist, author of "Fight Like Hell: The Untold Story of American Labor," and friend-of-the-show, joins us to talk about another disease epidemic that no one's talking about that is hurting some of the country's hardest workers.

Read Kim Kelly's full report on how Silica is destroying the lives of coal miners and their families: here.

By staff - Appalachian Voices, August 3, 2023

By Claire Kovach, Stephen Herzenberg, Amanda Woodrum, and Ted Boettner - ReImagine Institute, Keystone Research Center, Ohio River Valley Institute, July 25, 2023

The Appalachian region has long suffered from not having enough good paying jobs. Even when the unemployment rate is low, too many Appalachians are disconnected from the workforce entirely due to a myriad of factors. The result has been a long-term structural unemployment problem that has persisted for decades, with too many Appalachian adults out of the workforce entirely and unable to secure a decent paying job where they live.

A federal job subsidy program that is targeted at breaking down barriers to employment – such as improving the skills and experience of potential workers to meet current employer demands in their local labor market – and connecting them with a job could not only boost incomes and improve the livelihood of thousands of Appalachians but also give people self-esteem, a source of identity, and feel more connected to their community.

This report examines the economic conditions of Appalachia with a particular focus on the Appalachian counties of four states—Kentucky, Ohio, Pennsylvania, and West Virginia—that comprise the footprint of ReImagine Appalachia and the Ohio River Valley Institute. This includes describing how Appalachia has been a “region apart” from the rest of America, including its history of resource extraction and exploitation, the collapse of the steel industry, and now coal, that has led to large employment losses in the area, and how the region’s uneven development has led to chronically low rates of employment, disenfranchisement from the labor market and even loss of hope underpinning the opioid epidemic from which the Appalachian region was particularly hard hit.

Download a copy of this publication here (PDF).

By Al Weinrub - Non Profit Quarterly, July 13, 2023

There are two very different (and antagonistic) renewable energy models: the utility-centered, centralized energy model—the existing dominant one—and the community-centered, decentralized energy model—what energy justice advocates have been pushing for. Although both models utilize the same technologies (solar generation, energy storage, and so on), they have very different physical characteristics (remote versus local energy resources, transmission lines or not). But the key difference is that they represent very different socioeconomic energy development models and very different impacts on our communities and living ecosystems.

Let me start by recounting some recent history in California—the state often regarded as a leader in the clean energy transition.

In recent years, California’s energy system has failed the state’s communities in almost too many ways to count: utility-caused wildfires, utility power shutoffs, and skyrocketing utility bills, for starters. Currently, state energy institutions are advancing an all-out effort to suppress local community ownership and control of energy resources—the decentralized energy model.

Instead, they are promoting and enforcing an outmoded, top-down, utility-centered, extractive, and unjust energy regime—the centralized energy model—which effectively eliminates local energy decision-making and local energy resource development. This model forces communities to pay the enormous costs of unneeded transmission line construction and bear the massive burden of transmission line failures.

Using the power of the state to enforce the centralized energy model is at the heart of California’s new renewable energy tyranny. And this tyranny has now spread to the federal level, as substantial public investment is now set to go toward large-scale renewable energy projects across the country. These projects will be controlled by and benefit an increasingly powerful renewable energy oligarchy. Being touted as a solution to what is popularly regarded as the “climate emergency,” this centralized energy model has actually failed to meet our communities’ energy needs, and at the same time has exacerbated systemic energy injustice.

By Jason Cox - Transportation Communications Union, June 23, 2023

By Katt Ramos, et. al. - Maya Media, May 28, 2023