States with fracking disclosure rules have higher water quality: study

Increasing transparency requirements around fracking activity and the specific fluids used in the process are associated with lower pollution levels from that activity, new research shows.

A recent study from the University of Chicago’s Energy Policy Institute examined water quality in watersheds where fracking occurred.

Specifically, researchers analyzed salt concentration, a common indicator for fracking impact due to its associated health and development hazards.

They found consistent improvement on this benchmark in cases where the state imposed disclosure rules. In states with transparency rules, salt concentration fell by up to 17.8 percent. In contrast, their research found no comparable decline for pollutants not specifically associated with the fracking process.

Meanwhile, researchers also found that in states with mandatory disclosure rules, fracking firms’ use of chloride-related chemicals declined, and about 5 percent fewer new wells were drilled. They further found that other mechanisms of public pressure were also associated with lower salt concentrations.

For example, the greatest drop occurred in areas with more local newspapers and local environmental nongovernment organizations, as well as states with higher rates of Google searches for hydraulic fracturing. The research also indicated water quality is better in regions where more fracking wells are owned by publicly traded companies.

“Transparency in this context worked remarkably well, leading one to believe that disclosure mandates for other industries and for other causes—from reducing harmful chemicals in products to reducing carbon emissions—could also be successful, and even more so when it leads to the public imposing pressure on firms,” co-author Giovanna Michelon, a professor at the University of Bristol’s Cabot Institute for the Environment, said in a statement.

Researchers analyzed the impacts in 16 states: Arkansas, Colorado, Kansas, Kentucky, Louisiana, Mississippi, Montana, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia and Wyoming.  

“This notion that targeted transparency can be used to influence corporate behavior has been around for a long, long time,” co-author Christian Leuz, the Charles F. Pohl distinguished service professor of accounting and finance at the University of Chicago’s Booth School of Business, told The Hill. “But for the type of behavior where the impacts are much more widespread and not as easily visible or detectable, it wasn’t clear to us that targeted transparency was going to work.”

However, he said, the research suggests that “when public pressure was picking up on the transparency, as the analyses suggest when we look at things like Google Trends or media coverage, the pressure was essentially amplifying the effect of disclosure regulation, and that, in turn, seems to have been crucial for the impact of these disclosure mandates.”

A 2005 law bans the federal government from requiring disclosure of the composition of fracking fluids. However, 26 states issue disclosures through FracFocus, the Ground Water Protection Council’s national fracking chemical registry. 

Only California required disclosure of all chemicals with no exception for trade secrets, with Colorado set to implement the same requirement in 2023.