What will be the future impacts of our new-found ability to get
gas out of shale? In the US, shale gas is becoming an increasingly
important energy source, and such has been the expansion of
production over the past decade that gas prices have fallen
dramatically as a result of what analysts are calling a "
shale-driven glut".
But what does that mean for us, and could the same thing happen in
the UK? Here, shale gas currently has the status of a classic
environmental controversy, rather than a big energy
transformation.
While a
vocal lobby argues that shale gas has the possibilty to bring "
cheap, plentiful and green" energy to British shores, their
opponents argue that the controversial extraction process (known as
'fracking') is environmentally damaging, and that shale gas is a
distraction from renewables and energy efficiency.
Even more tantalising to the media is the prospect of
confrontation between a Texan company and the tweed belt of
the Home Counties over proposals to prospect for the gas.
This was the stage for the latest in a series of seminars from
Policy Network, this one entitled "shale gas:
positive breakthrough or environmental disaster?" The event
gave the platform to author of the
Politics of Climate Change and Policy Network fellow traveller
Anthony Giddens, as well as emeritus professor of petroleum policy
at Dundee Professor
Paul Stevens, and
James Elston of Palladian Energy (which seems to be a shale gas
consultancy).
Shale gas in the USA...
The impact in the USA has certainly been pretty phenomenal. EIA
figures show that in 2009 16% of domestic gas
production in the USA came from shale - by 2035 it could be as
much as 47%. In its Energy Outlook released last week, BP cited
research showing the the US could become a
net exporter of gas by 2030 off the back of shale
production.
International geopolitics forms a fascinating part of the picture.
To give one example - at the seminar, Anthony Giddens discussed the
impacts on the relationship between Russia and its neighbours.
Indigenous production of shale gas could release Eastern European
countries, like Poland,
from the dominance of Russia - a prospect that apparently
has Russia somewhat worried.
Shale gas in Europe
So could the 'shale gas boom' take off in Europe as it has in the
States? In the discussion, the general consensus was 'not
immediately', for a variety of reasons. Prospecting for gas in the
Sussex commuter belt, for example, is a much more complex
proposition than it is in the relatively sparsely populated US.
Infrastructure for extracting and shifting gas around also isn't as
developed in Europe as it is in the States, and differing
approaches to mineral rights also alter landowners' reactions to
the prospect of gas discoveries under their land.
Professor Stevens argued that a significant amount of shale gas
produced in Europe will not be produced in the next 5 years, and
that it will not be a "serious possibility" for 15-20.
James Elston - an energetic and enthusiastic proponent of shale
gas - seemed to agree. These seem like important figures to bear in
mind in relation to more short-term discussions around energy
costs, and particularly household bills.
Environmental impacts - fracking
The 'fracking' process by which shale gas is extracted from rocks
is famously controversial, and the speakers discussed the impacts,
including a recent minor
earthquake in Blackpool and the impact on ground water
aquifers.
Mr Elston argued that there has been "more than a million fracks"
in the USA with no successful class action lawsuits as a result. He
also
cited research from the British Geological Society showing that
the earthquake was "very minor". At the seminar however there
seemed to be a general agreement that the local impacts of
extraction are an important part of the debate, but probably not
intractable with sufficient regulation.
Environmental impacts - greenhouse gas
emissions
Perhaps of more interest (to us, anyway - you may feel different
if you live in Blackpool) is the impact of shale gas on greenhouse
gas emissions, which has unsurprisingly received somewhat less
attention from the press than earthquakes.
When burnt, natural gas produces around
half the emissions of coal. As a result, shale gas is often
touted as a potential 'transition fuel' - that is, a cheap and
relatively low-emissions fossil fuel that could help meet our
energy needs until (hopefully) emissions cutting
renewables/nuclear/CCS take over.
It's the extraction process which complicates working out what the
'carbon footprint' of shale gas actually is. Fracking can cause
methane to leak at the same time as gas is extracted. Methane is a
powerful greenhouse gas, and a
study by Cornell University published in 2008 suggested that as
a result shale gas has a 'carbon footprint' almost as high as coal.
Not good, if you want to use it as a cleaner energy source.
However, the Cornell report has been heavily
criticised by other studies since, and it was pretty roundly
abused by the speakers at the seminar. Mr Stevens in fact argued
that the main advantage of the study was that it was so bad that it
prompted others to take a look at the same question.
Other studies, including a literature
survey by the Manchester Tyndall Centre, an
American paper published in 2011, and a recently published
paper in Environmental
Research Letters all appear to indicate that whilst emissions
from shale gas are slightly higher than 'conventional' gas, the
difference is not that massive.
Mr Elston also pointed out that letting methane leak out from your
gas plant is both uneconomic and not particularly safe (as it has a
tendency to explode), which seemed a reasonable point. There was
however universal agreement that not enough is known and more
research was needed in this area.
On the face of it, then, shale gas could make an effective
'bridging fuel' to renewables. But if that's what you're after,
there is a significant stumbling block - the economics. Advocates
of shale gas are also often keen to point out that shale is cheaper
than renewables, and won't require subsidies, thus posing a "
competitive threat" to all forms of renewable energy". If
that's true, and shale gas out-competes renewables instead of
out-competing coal, it's not really going to help with cutting
emissions in the medium-to-long term - after 2020, say.
The think-tank Policy Exchange have accepted that burning more gas
now may mean building gas plants which then have to be
mothballed in the 2020s, or retrofitted with Carbon Capture and
Storage. (See pages 9-10.) When we put the question of whether this
was a viable investment option to Mr Elston he responded (perhaps a
little evasively) that this was a question for the
politicians.
Shale gas poses some big questions, and dilemmas about the
difficulty of looking into the future. Probably most key is whether
there is a realistic chance of significant shale gas production
from Europe over the next decade, and if not, (as the speakers
appeared to agree on), whether gas prices in Europe will fall as a
result of cheaper prices in the USA. Will shale gas bridge, or will
it distract? There are questions still to be answered - by
someone.