Thursday, 17 May 2012

The Edge Debate on Shale

The Edge met at the Institution of Civil Engineers on 23rd April to ask Is Shale Gas a Game Changer?

This debate moved the discussion of shale beyond just the potential environmental effects of its adoption to the implications of shale gas becoming a major source of energy in the UK and globally. Chris Huhne chaired the event with John Miles of Arup, Mark Whitby of Davis Maquire + Whitby and Bill Bordass as speakers.

Huhne’s opening gambit introduced the idea that Fukushima has brought about a reduced interest in nuclear leaving a vacuum for a new and abundant energy source while in America, where shale gas has been energetically extracted, land rights mean that landowners are happy to exploit wealth locked in their land by selling the gas. The US has had an infamous lack of environmental controls on the shale extraction process as explored in the shocking film Gaslands and Methane is a dangerous by-product. Of course, closer to home, Quadrilla have been looking to extract new found shale in Lancashire. It is understood that shale is abundant in many regions of the world; enough for it to play a significant role in future energy production.

In the States, gas prices have halved over the last 3 years following high gas prices being linked to and possibly contributing to the economic crash. The suggestion arose that low energy prices facilitated by shale may stimulate economic recovery by attracting inward investment because low energy means low manufacture costs which means more manufacturing. China and South America have a great deal of shale, with the likelihood being that it’ll get used. Can the UK to be a leader for responsible extraction?

The UK cannot rely on other countries’ supplies of gas in future and the drive to a nuclear renaissance has been stopped in its tracks following Fukushima. This points to shale being a helpful energy source as long as it is affordable and the CO2 captured by CCS. Whitby explored how gas pricing in the UK/Europe where its link to oil prices differs to that in America where pricing is independent and open to offer/acceptance. Decoupling gas prices from oil prices through abundant shale would make shale cheap.

If shale was taken on internationally, there may be no significant exporters of gas any more, particularly if gas prices became unlinked to oil and decreased. This might in turn enable a switch from coal to gas which would on the surface see great CO2 emissions reductions. The belching elephant in the room here is methane, which with a global warming potential more than 20 times that of CO2 could see force a warming tipping point. International shale extraction must therefore be meticulously monitored, but, if done properly offers an energy source which in global warming terms is preferable to coal. CCS would be a crucial development to minimise the global warming impact of shale. Further, might shale gas be a natural, cheap partner to wind?

Should shale be broadly adopted leading to lower gas prices, might a sensible strategy be to force energy companies into fixing gas prices per unit as they stand and investing any profit into renewables? That way, shale could be seen to be a bridge towards a renewables-based energy portfolio.

Following broad debate about the economic, scientific, political and environmental aspects of shale, personal carbon allowances were mooted as a crucial intervention regardless of where we source our energy. The room was wary of a plentiful new fossil fuel which may distract the energy industry, public and governments from the need to switch to a carbon neutral lifestyle which underlined the simple need to reduce energy demand. How long until a political party can be elected with personal carbon allowances within their manifesto?

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