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SPOTLIGHT
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Water companies partner with fracking lobby

Published on -6/18/2012, 8:54 AM

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By SOFIA RESNICK

Two of the country's largest private water utility companies are participants in a massive lobbying effort to expand controversial shale gas drilling -- a heavy industrial activity that promises to enrich the water companies but may also put drinking water resources at risk.

The situation -- which some watchdogs describe as a troubling conflict of interest -- underscores the complex issues raised by the nationwide push to privatize infrastructure and services like water, prisons and roads.

The water companies -- American Water and Aqua America -- are leading drinking water suppliers in Pennsylvania, where drilling is booming. They also sell water to gas companies -- which use a drilling technique that requires massive amounts of water -- and have expressed interest in treating drilling wastewater, a potentially lucrative opportunity.

These investor-owned, publicly traded water utility companies are also dues-paying "associate members" of the gas industry's powerful Marcellus Shale Coalition, a fact confirmed by coalition spokesman Travis Windle, who says associate members pay $15,000 annually in dues. "Our associate members are really the backbone of the industry," adds Windle.

Both water companies serve millions of people across the country -- Aqua America operates in 11 states and American Water in more than 30.

The coalition, which is led by major gas producers, contends that "responsible development of natural gas" will bolster the region's economy while providing an important source of domestic energy. It has reported more than $2 million in Pennsylvania lobbying expenditures since 2010.

Shale gas drillers use a combination of horizontal drilling and hydraulic fracturing, or "fracking," to extract gas in the Marcellus formation. The controversial technique forces millions of gallons of water -- mixed with sand and chemicals -- into the ground to crack the shale rock and release gas. In addition to the potential risks posed by actual fracturing, the process produces toxic wastewater that can be difficult to dispose of safely.

The Environmental Protection Agency is currently conducting a congressionally mandated study of the "potential adverse impact that hydraulic fracturing may have on water quality and public health."

In the meantime, the water companies are selling water to the drillers while calling for fracking to be done in an environmentally responsible manner. In a presentation to investors last month, American Water stated that it is "realizing additional revenues from water sales to drilling companies while remaining vigilant in protecting our water sources."

(Some public water utilities also sell to drillers too, but no public utilities are part of the Marcellus Shale Coalition.)

American Water spokesman Terry Maenza says the company is also a member of numerous environmental groups and that its support for environmental protection is unchanged by its role in the shale coalition.

"By the nature of our business, we will continue to be stewards of the environment, ensuring water source protection," says Maenza.

Aqua America executive Karl Kyriss says his company's involvement in the coalition helps protect water resources.

"By participating, we can have some direct input into the group that is supporting development of the Marcellus Shale," says Kyriss. "But we are very much committed that it be done in an environmentally sensitive and protected manner. And we think we can do that better from the inside than just sort of watching what happens."

But environmental advocates see potential conflicts between the interests of the private water industry and the interests of drinking water consumers.

"If American Water and Aqua America wanted to ensure that their water supplies were protected, they would support a national ban on hydraulic fracturing for shale gas," argues Mary Grant, a researcher at Food and Water Watch, which has reported on Aqua America's ties to the coalition. "But, instead of acting on the precautionary principle, they are paying thousands of dollars a year to an industry coalition that advocates for shale gas development, despite the risks to water quality."

"We are concerned that these relationships encourage investor owned water utilities to endorse shale gas development despite its risk to public water supplies," Grant says.

Eric Goldstein, a senior attorney for the Natural Resources Defense Council, adds, "Sometimes the interests of private ownership are inconsistent with the concept of preserving our water resources in the public trust for future generations. And the potential clashing of those interests is why these questions have been raised about whether for-profit companies ought to be running public water supplies."

Sofia Resnick writes for the American Independent, a nonprofit newsroom that funds and publishes independent investigative journalism. editor@americanindependent.com

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