Pennsylvania Gas Revenue Dropped Sharply in 2020

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According to the Pennsylvania Public Utility Commission, Pennsylvania counties and municipal governments will be receiving the lowest annual level of fee revenue generated from the state’s Marcellus Shale gas wells. The dip comes after radical price drops and halted production that stemmed from pandemic lockdowns.

Impact fee revenue from natural gas dropped wells to $146 million from drilling activity in 2020, down $54 million from the year before, according to the commission.

Enacted by PA lawmakers in 2012, the tax is pinned to new wells and the price of natural gas. It has generated close to $2 billion in revenue for the state since that time. The money is distributed mostly to county and municipal governments, conservation programs and a smaller amount to state agencies.

The average price of natural gas in 2020 was $2.08 per million British thermal units, down from $2.63 in 2019. The commission also stated that 2020 saw the fewest number of new wells generated in the state since the tax was enacted in 2012.

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