pennsylvania
Shell's petrochemical complex in southwestern Pennsylvania. (Credit: Nate Smallwood for Environmental Health News and Sierra Magazine)
Shell’s petrochemical plant in Pennsylvania still hasn’t spurred economic development: Report
Western Pennsylvania’s Beaver County, which is home to the plant, is worse off than it was before the Shell plant was announced in terms of jobs, businesses and GDP, according to the report, which was authored by the Ohio River Valley Institute, a progressive nonprofit.
When Shell first proposed its Pennsylvania plastics plant in 2012, state lawmakers gave the company a $1.7 billion subsidy — the largest ever offered by the state at the time — to bring the plant to Beaver County. Lawmakers who supported the subsidy pointed to studies commissioned by Shell that claimed the plant would provide significant economic revitalization to the region.
“If you're a taxpayer in Pennsylvania, you should be asking for a refund right about now because you got robbed,” study co-author Eric de Place said during a press call. “There are hardworking people in that county who deserve better. They deserve better from their elected officials, they deserve better from their business community and they deserve better from the state of Pennsylvania and the legislature that's made these decisions on their behalf.”
This report updates two similar analyses published by the same group in 2021 and 2023, with all three reports relying on data from government agencies including the U.S. Census Bureau, the Bureau of Labor Statistics and the Bureau of Economic Analysis. The new report includes data for the time period after the Shell plant became operational in late 2022.
According to the report, Beaver County’s GDP has shrunk by more than 12% since 2012, despite double-digit growth in Pennsylvania and the nation, adjusting for inflation.
Credit: Ohio River Valley Institute
The report also found that:
- Beaver County’s population has fallen by nearly 3% despite population growth nationally and statewide.
- Beaver County’s employment has dropped by more than 13%, according to the Quarterly Census of Employment and Wages, while the number of employed people grew in Pennsylvania and the U.S.
- Beaver County has lost business firms and establishments despite business growth nationally and statewide.
In contrast, a 2021 study commissioned by Shell projected that the Shell ethane cracker would bring $260 million to $846 million in annual economic activity in Beaver County, that the plant and the indirect jobs it would create would add between between 777 and 1,444 new jobs for Beaver County residents, and that labor income increases in Beaver County would be between $73 and $120 million, resulting in the addition of $10.3 to $16.7 billion to Beaver County’s economy over 40 years.
Public health costs and advice for lawmakersCredit: Ohio River Valley Institute
Public health costs and advice for lawmakers
Shell’s plant takes fracked ethane gas and turns it into tiny plastic pellets that are ultimately used to make plastic products like bags and packaging. This process emits large volumes of air and water pollutants including volatile organic compounds, carbon monoxide, nitrogen oxides. These pollutants are linked to health effects including asthma, heart disease, mental health symptoms, poor birth outcomes, endocrine disruption and cancer.
Residents of Beaver County are bearing the public health costs associated with these emissions. Within six months of starting operations, the plant had exceeded its 12-month emission limit for numerous pollutants. Shell has been fined $10 million dollars by state regulators, about half of which is going toward impacted communities, and is being sued by advocacy groups representing local residents.
Plants like the Shell ethane cracker in Pennsylvania have been proposed throughout the U.S., as fossil fuel companies turn toward plastics production to keep their products in demand amid global decarbonization and the transportation sector’s shift toward renewables.
For example, ExxonMobil is currently seeking tax breaks to construct a similar ethane cracker in Calhoun County, Texas, about two and a half hours southwest of Houston.
“I would urge [Texas lawmakers] to take a hard look at actual economic performance, not marketing hype,” de Place said. “And I would urge them to include ‘clawback’ provisions if the promised results don't materialize.”
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Closing coal plants in environmental justice communities first would save more lives: Study
The study, published in Environmental Science & Technology, suggests that decreases in emissions from prioritizing environmental justice while phasing out Pennsylvania’s coal power plants could eventually prevent up to 136 premature deaths caused by air pollution across Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Tennessee, Virginia, West Virginia and Washington, D.C., which are served by the same regional power generation network.
“This study offers a model for balancing environmental, economic and social goals, shaping a healthier future for vulnerable communities,” Emily Pakhtigian, an assistant professor of public policy at Penn State and a co-lead author on the study, said in a statement.
Coal-fired power plants emit many health-harming pollutants, including carbon and sulfur dioxide, nitrogen oxides, particulate matter and heavy metals, which are linked to cancer, respiratory and cardiovascular disease among other health problems.
The U.S. is on track to close about half of its coal-fired power plants by 2026, according to the Institute for Energy Economics and Financial Analysis. In 2023, renewables provided more than 20% of the electricity in the U.S. and only around 220 coal power plants are still operating across the country, marking a decline of more than half since 2013.
These trends are mirrored in Pennsylvania, so researchers at Princeton and Penn State Universities and the University of Michigan used advanced computer modeling to evaluate six different scenarios for gradually phasing out coal production in the state, either by reducing capacity or generation, at the six coal-fired plants that were still operating in Pennsylvania as of 2019 (three of which remain open).
These scenarios evaluated how the state’s energy production could transition away from coal based on cost, climate priorities or environmental justice priorities. The study found that among the scenarios that reduced generation at coal power plants, prioritizing plants near Pennsylvania’s environmental justice communities yielded the largest public health benefits, resulting in up to 13% fewer deaths caused by air pollution in the state and 4% fewer deaths in the rest of the regional power generation network.
“By prioritizing coal plant retirements based on health and equity impacts, Pennsylvania could take significant strides toward cleaner air and more just energy policies,” said Pakhtigian in a statement.
The researchers assessed various scenarios for retiring coal-fired power plants based on different priorities.Image is from the study, "Designing Retirement Strategies for Coal-Fired Power Plants To Mitigate Air Pollution and Health Impacts"
Closing large coal plants can reshape power generation across the regional power system, which the research also accounted for.
“The beauty of our interdisciplinary approach is that it uses complex, coupled modeling methods to account for the entire chain of adjustments,” Joel Landry, an environmental and energy economist at Penn State and one of the study’s co-authors, said in a statement. “It captures not only the public health impacts within Pennsylvania, but also on other communities within the same regional power systems, such as those located near generation assets that may have to operate more to fill the demand gap caused by retiring Pennsyalvania’s coal plants.”
Only three coal-fired power plants remain operational in Pennsylvania today: The Keystone and Conemaugh generating stations, both of which are in western Pennsylvania and are expected to close by the end of 2028, and Talen Energy’s Montour station in central Pennsylvania, which is expected to convert to natural gas by the end of 2025.
In 2019, former Pennsylvania governor Tom Wolf signed an executive order to join the Regional Greenhouse Gas Initiative, a multi-state program that aims to reduce greenhouse gas emissions from power plants, in large part by speeding the retirement of coal-fired plants. The program was expected to create substantial public health benefits, including the prevention of between 282 and 639 premature deaths in Pennsylvania by 2030. But in 2023, the Pennsylvania Commonwealth Court ruled in favor of state Republicans and industry groups’ lawsuits against the initiative, halting it. Gov. Josh Shapiro's administration subsequently filed an appeal to that ruling in the state Supreme Court, which could take several years to rule on the case.
The authors of the recent study said they hope policymakers across the country will consider their findings when planning clean energy transitions in order to maximize public health benefits.
“Policies could provide enhanced incentives for new clean energy capacity that would displace electricity from coal-fired facilities with the largest health impacts,” Hannah Wiseman, a professor of law at Penn State and co-author of the study, said in a statement. “Regional transmission organizations, in particular, which govern the interconnection of new clean energy generation, should take these factors into account.”
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