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A Must Read Report on Shale Gas

by Michael Levi
August 11, 2011

The Natural Gas Subcommittee of the Secretary of Energy Advisory Board has published its 90-day interim report (PDF) on “Improving the Safety and Environmental Performance of Hydraulic Fracturing”. It is an exceptional piece of work. Anyone who wants to understand the environmental consequences of shale gas development, and the tools available to manage them, should read it in its entirety.

I won’t rehash the substantive contents of the report here; its executive summary, and various news reports, do a good job of that already. But I do want to flag an important observation about the political dynamics of shale gas development, from the body of the report, that may be missed:

The Subcommittee has been struck by the enormous difference in perception about the consequences of shale gas activities. Advocates state that fracturing has been performed safety without significant incident for over 60 years, although modern shale gas fracturing of two mile long laterals has only been done for something less than a decade. Opponents point to failures and accidents and other environmental impacts, but these incidents are typically unrelated to hydraulic fracturing per se and sometimes lack supporting data about the relationship of shale gas development to incidence and consequences. An industry response that hydraulic fracturing has been performed safely for decades rather than engaging the range of issues concerning the public will not succeed.

That’s right on the money. Alas, in what one can only hope is an attempt at self parody, API has responded to the report thusly: “DOE’s recommendations should be informed by an understanding, first, that shale-oil and gas development is already well regulated and safe, and, second, that it could create hundreds of thousands of new jobs, generate billions of dollars in additional revenue for our government and enhance our energy security.” Quite the logic: development is already safe, therefore any study should be informed by the fact that development is already safe, and should come to the conclusion that it is already safe, which means that the study should recommend nothing. Some others from industry, to their credit, have been more circumspect in their responses.

[UPDATE: Erik Milito at API responds in the comments. He argues that I've misunderstood his remarks, and gives further clarity to API's position.]

Not to be outdone, more strident members of the environmental community have responded by largely ignoring the content of the report, which is pretty tough on industry, in favor of personal attacks on the subcommittee members. (As with industry, some other folks from the environmental world have responded more constructively.) An article in the New York Times, meanwhile, seems to take credit for prompting the creation of the subcommittee in the first place. That, I can quite confidently say, was not the case.

John Deutch, who chairs the subcommittee, summed up the report nicely in an interview with the FT:

‘Our report is a compromise, and in that sense it will make nobody happy,’ Mr Deutch said. ‘This report is the only balanced discussion that I’ve seen of the shale gas industry.’

That’s true. If sensible people on all sides look past the fact that they don’t like everything in the report, they might even find the beginnings of a blueprint for compromise.

Post a Comment 6 Comments

  • Posted by Ben

    Your link under “more strident members of the environmental community” just links back to your piece

    [ML: Thanks, and yikes. Fixed.]

  • Posted by Nick Grealy

    The shale “debate” in the US sometimes degenerates into a Democrat/Republican issue instead of a national one. In Europe I run http://www.shalegasinfo.eu where we have the advantage of having more civilised discourse but the considerable disadvantage of a narrative built on flaming faucets that got there first. This is made more complex in that government policies surrounding renewables, CCS and conservation depend on a perception of finite and high cost energy to be economic. Throw in the power of Gazprom who act as if they financed Gasland (I’m not that paranoid BTW, but some are) and the power of the nuclear industry and it’s a similar mess sometimes.
    Let me just point out that the US industry has spent tens of millions promoting shale, but don’t seem to get value for money out of it.
    BTW, there is another big report out today from Carnegie Mellon which comes to the opposite conclusion of the famous Howarth reports which tried to show that coal was cleaner than gas. Don’t let it get lost in the shuffle!

    [ML: I'm with the SEAB committee on this one: the methane issue needn't be a theoretical one; it's time to just measure the stuff.]

  • Posted by Barbara Lynch

    Whie the Deutch report’s recommendations do address some of the technical concerns about drilling, they are remarkably insensitive to some of the deeper concerns that have motivated protest in New York’s Southern Tier. Here are several very valid concerns that have been expressed by citizens from all ends of the political spectrum.

    1. Many are upset by the methods used by the industry and its “landmen” to get landowners to sign leases. They would like to see their leases annulled.

    2. Many of us are worried not just by the potential for water contamination, which the report addresses, but by the volume of water that drilling requires. How will this affect the region’s aquifers over the long haul.

    3. Geographer Susan Christopherson correctly notes that many of the benefits to drilling will be short-lived, while the costs will be borne by generations to come.

    4. Town supervisors and planners are rightly concerned that the leasing process has undercut the authority of local government to make zoning and land use decisions.

    5. New jobs created go not to local residents, but to outsiders. This temporary influx of population inevitably produces a series of social problems. Housing is the most obvious, but there are others as well.

    6. Most important, many residents of our towns live here not because of the income opportunities, but because of non-monetary benefits–a beautiful landscape, tranquility,wonderful meats and vegetables produced by local farmers. Even if gas extraction is well reguated and pollution is kept to a minumum, these amenities would be lost.

    So, at the end of the day, regulation and transparency, while good in and of themselves, will not eliminate opposition to drilling. Few people want to live in boom towns, even fewer want to live in last year’s boom town.

    [ML: Fair points. #s 1, 3, 4, 5, 6 seem to be beyond the scope of the report as commissioned. I wouldn't call that insensitive -- it just isn't something the federal government has a real role in. Pretty sure #2 is addressed in the report.]

  • Posted by Erik Milito

    Michael,

    While I have great respect for your coverage of energy issues I have to take issue with your interpretation of my comment on the DOE report. It was meant to underscore that opponents of natural gas who claim that shale gas development is unregulated and unsafe are incorrect and that any work toward improving both the development of energy from shale and perceptions of that development must start with recognizing the hard work that regulators and industry already perform to ensure that this important resource has been, and will continue to be, developed responsibly. Far from being a dismissal of further studies and improvement –best practices and regulations are continuously evolving and part of that evolution is identifying problems and solving them– the comment was a reminder that any DOE recommendations must be based on reality and not on the alarmist rhetoric of those opposed to resource development.

    Thank you,
    Erik Milito
    API

    [ML: Thanks, Erik, for the comment. I'll flag it in the post. I hope you understand, though, that the phrase "already well regulated and safe" sends a pretty clear message that API doesn't see any regulatory shortfalls, particularly given that the SEAB report already flags the fact there substantial regulation and industry efforts already exist. I'm glad to read that API sees value in evolving regulation. If you'd like to identify areas where you think regulation should be strengthened, I'd be happy to write about them.]

  • Posted by David B. Benson

    Fly over northwestern New Mexico sometime.

  • Posted by MartinJB

    “David B. Benson responds:

    Fly over northwestern New Mexico sometime.”

    Pretty sure I’ve done that. What should I have been looking for?

    Cheers,

    MartinJB

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