Environmentalists decry softening of proposed regulation of drilling’s impact on Colorado’s poorest communities

Environmentalists and the oil and gas industry are battling over new state regulations that one side says would protect vulnerable communities that suffer the most from pollution and the other argues would effectively ban new wells in Colorado.

The latest clash involves the ongoing debate about how close those wells should be to homes.

Next month, the Colorado Energy and Carbon Management Commission must approve rules that define “cumulative impacts” of pollution and address how they affect what are known as disproportionately impacted communities across the state.

Gov. Jared Polis signed a bill last year directing the energy commission to establish rules regarding the cumulative impacts of drilling by considering how the oil and gas industry’s work can harm air and water quality, wildlife and public health, as well as increase odors and noise, in communities that are disproportionately impacted by pollution.

The cumulative impacts rule comes on the heels of the commission’s decision this week to approve a comprehensive plan from Crestone to drill up to 166 petroleum wells near Aurora Reservoir, despite strong opposition from a nearby neighborhood where homes cost between $600,000 and $1 million.

At issue in the newest debate is a provision that would have required a company to receive consent from every resident or building owner within 2,000 feet of a proposed drilling site. Right now, rules state drilling sites must have a 2,000-foot setback from homes, hospitals, schools and office complexes, but there are exemptions that allow companies to drill and those permits are rarely denied.

Environmentalists say those exemptions provide numerous loopholes that allow the industry to drill wherever it wants, and this latest provision was needed to protect the communities that suffer the most from air pollution, noise, traffic and other issues caused by drilling.

“It creates more room for the industry to continue to produce oil and gas in disproportionately impacted communities,” said Patricia Garcia-Nelson, an advocate for GreenLatinos Colorado.

“Blunt instrument to ban the industry”

The energy commission has been working on drafts of the new cumulative impacts rule for months, and those early versions — reviewed by environmentalists, oil and gas companies and lawyers — included the requirement for consent from neighbors. That changed last week when the commission’s staff released the latest draft.

Dan Haley, president of the Colorado Oil and Gas Association, said the industry urged the commission to drop the consent requirement.

“We feel those setbacks are unnecessary because they are a one-size-fits-all blunt instrument to ban the industry from Colorado,” he said.

The state already has rules in place to protect communities, Haley said.

Depending on the specific project, the state can require operators to use electric drilling rigs or install a closed-loop system that cuts toxic emissions. Regulators also can impose rules that reduce traffic, noise and odors, too.

“It’s not just about emissions,” Haley said. “Sometimes it’s about truck traffic. Sometimes it’s about odor. There are a lot of tools at the ready to make sure the communities are protected.”

Haley also noted that effectively banning new wells in the state would force Colorado to buy its gasoline and petroleum products from other sources. That would have an environmental impact, too, because the product would have to be shipped, trucked and piped into the state.

Colorado is the fourth-largest state supplier of crude oil and eighth-largest natural gas producer, according to the Energy Information Administration. The industry contributes nearly $2 billion in state and local tax revenue in Colorado.

“The commission has listened to their concerns for years, which is why we have the most protective environmental standards in the world right here in Colorado,” Haley said of environmentalists. “Some of these groups are not going to be satisfied until there’s a ban on oil and gas in Colorado.”

Considering cumulative impacts

Environmental advocates say the state regulators who make decisions on drilling permits ignore communities where residents are mostly Latino, Black or Indigenous and whose income levels are often lower than the state average. A consent provision would have given them a stronger voice in decision-making for drilling permits.

“I’ve been doing testimony in front of the commission since 2017 and we keep hearing the same ‘the sky is falling’ claims from the industry, but… the concerns of the community have never changed, and they’re never been addressed,” Garcia-Nelson said. “It’s really heartbreaking.”

To explain how cumulative impacts on a community should be considered, Garcia-Nelson, who lives in Greeley, offered as an example the neighborhood near the JBS Foods meatpacking plant on the north side of the city.

Three oil and gas operations sit within a half mile of the plant. There are homes less than a half mile from the plant and the drilling sites, and they’re all close to the Cache la Poudre River, she said.

If cumulative impacts were to be considered before issuing a drilling permit, regulators would need to consider how all of those industrial operations combine — air pollution, water pollution, traffic, noise and foul smells — to affect nearby residents rather than solely judging the impact of the single permit under consideration, as is the practice now.

Allowing residents to give consent would help people in a city surrounded by oil and gas drilling, Garcia-Nelson said.

“In Greeley, you can’t get away from it,” she said.

“Only one set of concerns being addressed”

When the energy commission’s staff released the latest draft on Aug. 2, the provision that would have required consent to override setbacks was struck from the proposal.

Environmentalists were livid that the provision not only was gone, but that it had been removed seemingly out of the blue after months of drafts included it. Now, their written rebuttals are due Friday and they have little time to organize opposition ahead of rulemaking hearings that begin Sept. 3.

“It literally seems like the ECMC accepted every one of the industry’s concerns and stripped out every one of the community’s concerns,” said Rebecca Curry, an attorney for Earthjustice, a nonprofit law center that takes on legal cases for environmental groups. “They made a bunch of changes that go in the wrong direction.”