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by Paul Ballard
April 16, 2013
~ “Energy is Eternal Delight” ~ William Blake, ‘The Marriage of Heaven and Hell’, 1790.
~ “The world is running out of cheap oil. It’s a finite and diminishing resource.” ~ T. Boone Pickens 2005.
~ “In the view of this author, a life member of the Sierra Club, the solution is the responsible production of shale gas as a bridge fuel. Clean coal is not an oxymoron, but it is expensive. At the same time, the move to renewable energy must be accelerated.” ~ Vikram Rao, 2012
~ “To increase our dependence on shale gas from fracking would be a dangerous detour from developing a responsible, sustainable energy policy. Natural gas is not a bridge; it’s a gangplank to a destabilized climate and an impoverished economy.” ~ Michael Brune, Sierra Club, 2013.
Dramatic changes are afoot in the world’s energy industry, spearheaded by developments in the U.S.A. Their impact deserves close understanding. Their effects will be far-reaching on our and our children’s prosperity and well-being for years to come. They could hugely affect what we pay for energy – for
gasoline for our cars, for power and gas to light, heat and cool our homes. Imagine paying $6 a gallon to fill your car up today – or $11-12 a gallon in 2035! Also they could greatly impact our environment and climate change.
Only recently we all thought America was doomed to increasing import dependence in decades to come. Now a new technology pioneered here could make the U.S.A. virtually energy independent by 2035. In its “World Energy Outlook 2012” the International Energy Agency (IEA) calls this a “game-changer”.
Starting from one U.S. Dept. of Energy sponsored private well in Texas in the early 1990s, shale gas took off explosively. By 2010 it was over half of total U.S. gas production.
This has sparked major controversy. Industry specialists see in shale gas a bridge buying time for us eventually switching predominantly to renewable energy sources, still many decades away. Environmentalists see a risky new technology fraught with immediate ecological threats. This controversy spread to Europe recently. Several countries (notably France and U.K.) have banned or stopped shale gas licensing. Either way, shale gas is set to figure large in the world’s energy future and in political debate here and abroad.
Key Questions are : How much can shale gas add to US and world energy supply in coming decades? How will it affect the price we pay for energy – for transport and for power to heat our homes and factories? What are the environmental risks and consequences? And how will this play out – positively or negatively – in terms of climate change?
Our Changing Energy World : Our world has been changing greatly in its energy use in recent years :
~ Faster growth in population and economies in developing countries means together they now consume more energy than all developed countries. This will intensify through 2035. China and India in particular will massively expand their energy use with faster urbanization, industrialization and many more cars than now.
~ Oil still dominates our energy supplies. But with few major new discoveries, oil reserves are still very large but dwindling. On the positive side, use of cleaner natural gas is expanding rapidly. Less positively, use of “dirtier” (more polluting, higher emission) coal is growing. Renewables – especially hydro-electric, wind and solar power- are also expanding in use. But they are a very small share – 13% – of total. They still rely on government subsidies. And there are large subsidies on fossil-fuel consumption in many countries. And the full environmental costs from carbon dioxide emissions are not built into energy prices we pay.
~ If we carry on consuming gasoline ever faster, without doing more on conservation, gasoline prices we pay would more than double by 2035. This is due to a massive (40%) increase in demand worldwide and continued heavy use of oil. Similar large price increases will hit us over the next twenty years in our home, office and factory heating and cooling bills. IEA says we can reduce future energy prices greatly – by as much as 40% – by adopting higher energy efficiency standards for our cars, trucks, homes, office buildings and factories. Also, the more we switch out of dirtier fuels like coal and oil and use more natural gas and especially renewables, the cleaner the environment and the lower our energy costs will be long-term!
“Golden Age of Gas” : Discovery of massive supplies of shale gas in the USA – and prospects for similar supplies elsewhere (China, Australia) – can potentially reshape our energy future for the next half century. By doubling supplies already available of conventional natural gas, they will enable the U.S.A. and the world to enjoy lower gas prices. Natural gas along with renewables are slated to become the two largest and fastest growing sources of energy in the world by 2035. Little wonder the IEA has christened the years ahead as a “golden age of gas”. Yet the future of shale gas remains uncertain because of environmental concerns.
What is “Fracking” ? : Much of the controversy surrounding shale gas comes from the new technology used to extract it. It is called hydraulic fracturing, or “fracking” for short. It consists of drilling wells deeper than ever before – up to 7,000 feet – below ground. It uses huge amounts of fluid (usually water) mixed with various chemical additives to break through hard – hitherto impenetrable -shale rock to locate and release vast supplies of gas literally locked up there until now.
Shale Gas – Promise and Risks : The advent of shale gas brings with it great promise but also considerable potential risks. On the plus side, shale gas can massively increase overall gas and energy supplies in the world. It can enable us to enjoy lower energy prices for decades. Shale gas is relatively quick and easy to set up wells to extract. In just one year, 2007, over 5,000 wells were drilled in the U.S.A. Geologically, shale gas is widely distributed across the U.S.A. and the world. Major shale gas fields are in production in over ten states, including New York, Pennsylvania, Texas, California, Michigan. In three years up to 2009, U.S. shale gas production rose thirty fold from 2 trillion cubic feet to 60 trillion cubic feet. By 2020, the U.S.A. can overtake Russia as the world’s largest gas producer and have prospects for major liquefied natural gas (LNG) exports. By 2035, over seventy percent of US gas supplies could come from shale and other unconventional gas fuels.
Against this, the Sierra Club and other environmentalists point to major risks : ~ Shale gas production uses great quantities of water and creates much waste water with chemical pollutants some carcinogenic. ~ Major concerns have been raised about leakages into local aquifers for drinking water and farming. ~ Large-scale, heavy drilling deep into the ground can cause seismic events – small earthquakes. Though generally of low magnitude (less than 2 on Richter scale), these have led the U.K. to suspend all “fracking” pending review. The IEA and other energy industry experts have proposed adoption of rigorous regulations regarding well and drilling standards, and safe disposal of waste water. They have proposed adoption of a transparent code of conduct in which the gas industry establishes high baseline health, environmental, and water disposal standards. Yet, the shale gas industry in the U.S.A. has not been helped by the gas industry’s continued exemption from U.S. clean and safe water regulations. To address these concerns, the IEA has proposed adoption of industry-wide “golden rules” setting much higher than minimum standards for environmental safety.
Two Routes Forward to Our Energy Future : Clearly the jury is out on safety and sustainability of shale gas production. Yet in any future energy scenario, we need natural gas to play a much larger role. Compared to coal, it is cleaner and investments are less costly and faster. Expanding gas and renewables combined share in world energy consumption to over sixty percent in the next twenty years is key to addressing climate change. Yet, while growing rapidly, use of renewables is still limited, held back by cost and viability issues.
Two alternative routes are before us :
~ (1) The Energy Industry Route takes great advantage of shale gas and other unconventional gas fuels as a cheaper and cleaner alternative to coal. Their “bridge” strategy would expand our energy supplies, thus keeping prices lower, while renewables are given time to mature and expand as new sources of supply.
~ (2) The Environmentalist Route places tight regulatory limits and controls on shale gas restricting its future growth. Strong emphasis is placed on phasing out fossil-fuel subsidies, carbon taxation and carbon pricing to curb greenhouse gas emissions. The aim is fast expansion of renewables as a major share of America’s and the world’s energy supply.
The Choice and Ideas for Change : As William Blake knew, there is no perfection in human affairs. The delight of energy can be found in both heaven and hell, but in different ways! We need a practical way forward for our energy future that is affordable and manageable economically and environmentally. The choice may come down to : (a) foregoing shale gas – as the environmentalists propose – and risking massively higher energy prices over the next thirty to forty years; or (b) exploiting shale gas potential fully and risking major environmental strains and calamities.
In the political climate today – as recent international climate change conferences have shown – notably in Stockholm in 2009 – and also the inability of the U.S. Congress to pass either cap and trade or a carbon tax – it would seem more realistic to opt for a middle path. This could help build progressively a broader consensus for change. It could include : (1) enacting promptly much more rigorous safety, environmental and drilling standards for the shale gas industry; (2) moving quickly to implement energy efficiency standards and related climate change mitigation measures – such as increased carbon collection and storage (CCS); and (3) adoption of a carbon tax – as a key element of a sustainable energy and climate change mitigation drive in the USA and globally.
I, for one, hope that our political leaders will take the opportunity of the arrival of shale gas to chart a more sustainable energy future for us all. But, I have little doubt the road will be a hard and long one!1