Pollution Fears Crush Home Prices Near Fracking Wells

Apr 10 2014, 4:33pm CDT | by

Whether or not fracking causes groundwater pollution, people fear the risk enough that property values have dropped for homes with drinking-water wells near shale-gas pads, according to new research.

Researchers from the Unviersity of Calgary and Duke University studied property sales from 1994 to 2012 in 36 Pennsylvania counties and seven counties in New York. They mapped sales against the locations of shale-gas wells, and they compared homes connected to public drinking-water systems to homes with private wells.

Properties with private wells suffered a loss in value compared to properties connected to a municipal water system, they found, offsetting gains in value from mineral-rights royalties. The loss varied with distance from the nearest shale-gas well. At 1.5 kilometers, properties with private wells sold for  about 10 percent less.

“If these two properties are similar in everything but the type of water they are using, then we find that difference equals negative 10 percent,” said Lucija Muehlenbachs, an assistant professor at the University of Calgary, at a seminar today in Washington D.C. sponsored by Resources for the Future, an environmental policy research institute.

Properties suffered greater losses when closer to shale-gas wells where hydraulic fracturing had been employed.

Within 1 km of shale gas wells, properties with private drinking water wells dropped 22 percent in value. Properties connected to public water suffered no losses, but also showed no net gains.

“If you get closer, if you look at the properties that are only 1 km from a shale gas well, then for the ones that are on groundwater we see a 22 percent loss in property values,” Muehlenbachs said, ”and for the ones that have access to pipe water, there’s zero gain, so essentially all of the positive benefits get wiped out by these negative externalities of having this well pad nearby.”

Such negative externalities include truck traffic, noise, light, and air pollution.

Muehlenbachs conducted the research with Elisheba Spiller and Christopher Timmins of Duke University and published the findings in a discussion paper earlier this year.

At distances greater than 2 km from shale gas wells—what Muehlenbachs calls the vicinity level—the researchers found a net increase in property values that declines over time—”evidence of a small boom-bust cycle at the vicinity level.”

Whether shale gas wells actually cause groundwater pollution is a topic fiercely debated.

“We don’t know,” said Alan Krupnick, Senior Fellow and Director of RFF’s Center for Energy Economics and Policy. ”What Lucija is getting in her data is people’s preferences and fears. That’s not necessarily reality, that there’s groundwater pollution, there’s just fear that they’re could be.”

One Department of Energy study found no evidence of groundwater pollution from a Pennsylvania shale gas well.

Follow Jeff McMahon on FacebookGoogle PlusTwitter, or email him here.

Read More:

Fracking Truck Sets Off Radiation Alarm At Landfill

Strange Byproduct Of Fracking Boom: Radioactive Socks

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

US reporter requests privacy after release
Washington, Aug 28 (IANS/EFE) The US journalist, who was freed this week by the miltants in Syria after two years in captivity, Wednesday thanked everyone for their efforts to secure his release and asked for privacy to be with his family.
 
 
Congo confirms six Ebola cases
Brazzaville, Aug 28 (IANS) Six cases of the Ebola virus have been confirmed in Democratic Republic of Congo (DRC), Health Minister Felix Kabange Numbi said Wednesday.
 
 
IMF chief faces investigation in corruption case
Paris, Aug 27 (IANS/EFE) International Monetary Fund (IMF) chief Christine Lagarde has been put under investigation in France for "negligence" after being questioned for hours in a corruption case, judicial sources said Wednesday. She denied wrongdoing.
 
 
Whale tourism affecting marine animals' behaviour
London, Aug 27 (IANS) Boat trips to watch whales and dolphins may increasingly put the survival of marine mammals at risk, conservationists have warned.
 
 
 

Latest from the Network

Most people take my clothes too seriously: Rick Owens
Los Angeles, Aug 28 (IANS) American fashion designer Rick Owens believes his fans takes his designs too seriously. The California-born designer, known for his statement drop-crotch shorts and leather jackets, believes...
Read more on Celebrity Balla
 
US reporter requests privacy after release
Washington, Aug 28 (IANS/EFE) The US journalist, who was freed this week by the miltants in Syria after two years in captivity, Wednesday thanked everyone for their efforts to secure his release and asked for privacy...
Read more on Ad Balla
 
Chris Martin writes love songs about Jennifer Lawrence
Chris Martin is ''sweeping'' Jennifer Lawrence ''off her feet.'' The Coldplay frontman, who split from Gwyneth Paltrow in March after 10 years of marriage, has reportedly been pulling out all the stops to romance 'The...
Read more on Celebrity Balla
 
Neil Young will continue to support ailing son
Neil Young and Pegi Young will continue to co-parent their ailing adult son. The 68-year-old 'Heart of Gold' hitmaker, who filed for divorce from the 61-year-old singer last month after 36-years of marriage, stated in...
Read more on Celebrity Balla
 
Dating actresses best for Daniel Radcliffe
London, Aug 28 (IANS) Actor Daniel Radcliffe says dating actresses works well for him as they understand the demands of the industry. The "Harry Potter" actor is currently in a relationship with his "Kill Your...
Read more on Celebrity Balla
 
Egypt accuses Morsi of leaking documents to Qatar
Cairo, Aug 28 (IANS) The Egyptian prosecution ordered Wednesday to temporarily detain former Islamist president Mohamed Morsi for 15 days on charges of leaking "national security documents" to Qatar, media reported....
Read more on Politics Balla
 
Poland sends humanitarian aid for Ukrainian soldiers
Warsaw, Aug 28 (IANS) The Polish National Defence Ministry said Wednesday humanitarian aid for Ukrainian troops is already on its way. Poland will provide around 320 tonnes of relief supplies, including food, blankets...
Read more on Politics Balla
 
Child abuse: British police commissioner's resignation demanded
London, Aug 28 (IANS) Police commissioner of the British metropolitan county of South Yorkshire has come under fire from various quarters after an inquiry exposed shockingly child sexual abuses. Leaders from different...
Read more on Politics Balla
 
UN Security Council urges for immediate ceasefire in Libya
United Nations, Aug 28 (IANS) The UN Security Council Wednesday adopted a resolution on Libya, calling for an immediate ceasefire while expanding sanctions on those who involved in the violence there. The 15-member...
Read more on Politics Balla
 
Cara Delevingne to star in 'Zoolander' sequel?
Los Angeles, Aug 28 (IANS) Model Cara Delevingne may star in the upcoming "Zoolander" follow-up alongside Ben Stiller. The 22-year-old model is said to be negotiating with the movies' star, Stiller, over the female...
Read more on Celebrity Balla