Five Facts About CSSB 421
Texas is the largest oil and gas producing state, and that production depends on Texas pipelines to deliver affordable energy to consumers. These energy supplies fuel the Texas miracle, which is made possible by a low tax, low regulation operating environment that differentiates us from places like California or New York. Senate Bill 421 would create new and unnecessary regulations on Texas pipelines that will give the government more control over Texas energy.
More Government Control
SB 421 would grant power to an informal panel to impose penalties on pipeline operators, based only on guidelines rather than uniform standards. If a pipeline company appeals the panel’s decision and succeeds in court, thus proving the panel’s decision incorrect, the company would still have to pay the penalty.
More Truck Traffic
SB 421 would make it harder to build new pipelines, which are the safest way to transport oil and gas. A single pipeline can replace the need for hundreds or even thousands of truck trips to deliver the same fuel. As a result, pipelines help relieve traffic congestion, which also helps improve air quality.
The informal panel set up by SB 421 would not be operating on any objective standard of evidence, but rather a set of poorly defined guidelines, meaning any decision will be prone to litigation. This will benefit and even incentivize lawyers, at the expense of landowners who may not be able to afford the costs of a prolonged lawsuit.
More Confusion for Landowners
The bill would create a public hearing process with so many procedural rules and hurdles that landowners may have no choice but to hire an expensive lawyer from the outset. Additionally, the informal panel’s lack of objective standard means neither landowners nor developers would have a clear sense of how a decision would be made.
The Permian Basin will be producing 6 million barrels of oil per day by 2025, and demand for Texas natural gas is growing – at home and abroad. To ensure this Texas energy miracle continues, we need more pipeline infrastructure. Encouraging litigation on infrastructure projects will raise the cost of energy and make it more difficult to deliver fuel during emergencies like Hurricane Harvey.