Friday, November 21, 2014
9

A Fracking Good Story

PRAGUE – Weather conditions around the world this summer have provided ample fodder for the global warming debate. Droughts and heat waves are a harbinger of our future, carbon cuts are needed now more than ever, and yet meaningful policies have not been enacted.

But, beyond this well-trodden battlefield, something amazing has happened: Carbon-dioxide emissions in the United States have dropped to their lowest level in 20 years. Estimating on the basis of data from the US Energy Information Agency (EIA) from the first five months of 2012, this year’s expected CO2 emissions have declined by more than 800 million tons, or 14%, from their peak in 2007.

The cause is an unprecedented switch to natural gas, which emits 45% less carbon per energy unit. The US used to generate about half its electricity from coal, and roughly 20% from gas. Over the past five years, those numbers have changed, first slowly and now dramatically: in April of this year, coal’s share in power generation plummeted to just 32%, on par with gas.

America’s rapid switch to natural gas is the result of three decades of technological innovation, particularly the development of hydraulic fracturing, or “fracking,” which has opened up large new resources of previously inaccessible shale gas. Despite some legitimate concerns about safety, it is hard to overstate the overwhelming benefits.

For starters, fracking has caused gas prices to drop dramatically. Adjusted for inflation, gas has not been this cheap for the past 35 years, with the price this year 3-5 times lower than it was in the mid-2000’s. And, while a flagging economy may explain a small portion of the drop in US carbon emissions, the EIA emphasizes that the major explanation is natural gas.

The reduction is even more impressive when one considers that 57 million additional energy consumers were added to the US population over the past two decades. Indeed, US carbon emissions have dropped some 20% per capita, and are now at their lowest level since Dwight D. Eisenhower left the White House in 1961.

David Victor, an energy expert at the University of California, San Diego, estimates that the shift from coal to natural gas has reduced US emissions by 400-500 megatonnes (Mt) of CO2 per year. To put that number in perspective, it is about twice the total effect of the Kyoto Protocol on carbon emissions in the rest of the world, including the European Union.

It is tempting to believe that renewable energy sources are responsible for emissions reductions, but the numbers clearly say otherwise. Accounting for a reduction of 50 Mt of CO2 per year, America’s 30,000 wind turbines reduce emissions by just one-tenth the amount that natural gas does. Biofuels reduce emissions by only ten Mt, and solar panels by a paltry three Mt.

This flies in the face of conventional thinking, which continues to claim that mandating carbon reductions – through cap-and-trade or a carbon tax – is the only way to combat climate change.

But, based on Europe’s experience, such policies are precisely the wrong way to address global warming. Since 1990, the EU has heavily subsidized solar and wind energy at a cost of more than $20 billion annually. Yet its per capita CO2 emissions have fallen by less than half of the reduction achieved in the US – even in percentage terms, the US is now doing better.

Because of broad European skepticism about fracking, there is no gas miracle in the EU, while the abundance of heavily subsidized renewables has caused over-achievement of the CO2 target. Along with the closure of German nuclear power stations, this has led, ironically, to a resurgence of coal.

Well-meaning US politicians have likewise shown how not to tackle global warming with subsidies and tax breaks. The relatively small reduction in emissions achieved through wind power costs more than $3.3 billion annually, and far smaller reductions from ethanol (biofuels) and solar panels cost at least $8.5 and $3 billion annually.

Estimates suggest that using carbon taxes to achieve a further 330 Mt CO2 reduction in the EU would cost $250 billion per year. Meanwhile, the fracking bonanza in the US not only delivers a much greater reduction for free, but also creates long-term social benefits through lower energy costs.

The amazing truth is that fracking has succeeded where Kyoto and carbon taxes have failed. As shown in a study by the Breakthrough Institute, fracking was built on substantial government investment in technological innovation for three decades.

Climate economists repeatedly have pointed out that such energy innovation is the most effective climate solution, because it is the surest way to drive the price of future green energy sources below that of fossil fuels. By contrast, subsidizing current, ineffective solar power or ethanol mostly wastes money while benefiting special interests.

Fracking is not a panacea, but it really is by far this decade’s best green-energy option.

  • Contact us to secure rights

     

  • Hide Comments Hide Comments Read Comments (9)

    Please login or register to post a comment

    1. CommentedWilliam Hileman

      Early reports show that ALL fracking areas are leaking methane into the atmosphere, some wells as much as 30 to 40 per cent of their total output. With the added problem of mixing our ground water with oil, gas and fracking chemicals, our troubles are just beginning. Try telling the truth occasionally.

    2. CommentedJ R Groeger

      At the risk of restating the obvious: burning gas is, of course, better than burning coal. However, Lomborg, too, is falling into the trap of focussing on the supply, rather than the demand side. Without doing the numbers, I would expect that the long overdue introduction of even relatively modest (by European standards) energy conservation measures in the U.S. to pay inordinately greater dividends at a fraction (no pun intended) of the cost of going after shale gas.

      So what the frack?

    3. CommentedGerald Silverberg

      But what about the unmeasured but substantial leakage emissions of methane due to fracking? Methane is a 26 times more potent greenhouse gas than CO2. Howarth et al. 2011 (http://www.springerlink.com/content/e384226wr4160653/), Wigley 2011 (http://www.springerlink.com/content/b430681263425q64/) and others argue that on balance, replacing coal by shale gas actually accelerates global warming rather than reducing it, due to the methane emissions. The price reduction in electricity generation (without an accompanying greenhouse gas tax) will undoubtedly also lead to the well-known rebound effect, with increases in demand partly or wholly eating up the CO2 emission savings due to gas/coal substitution.

    4. Commentedjames durante

      In addition to objections raised below, fracking does nothing to address the core problem of consumers total dependence on utilities. Whatever the energy source, everyone WILL remain a customer paying the fees a powerful utility chooses to impose.

      What solar provides is a manner by which consumers can gain energy independence and add substantially to their disposable income once the pv is paid for. THAT is the real threat to the King CONNG (Coal, Oil, Nuclear and Natural Gas).

        CommentedGary Marshall

        Hello James,

        Anyone can become energy independent. It will just take a lot more money to do so.

        Solar has limited applications. But go ahead and watch the TV at night with solar or in heavy clouds.

        The EPA has been doing a wonderful job imposing all sorts of outlandish costs on all those powerful utilities, driving up the energy costs of so many Americans, wealthy and destitute alike. Even Al Gore must pay more to heat his mansions.

        But getting the story right means telling people the truth, and we can't have that type of thinking prevailing among our AGW nutjobs, can we? Why it would be the end of AGW.

        GM

    5. CommentedMatt Stillerman

      Total world installed peak photovoltaic power appears to be doubling roughly every 1.3 years. As of 2011 it stood at about 67 GW. How many doublings before it meets all world energy needs? The thing about solar power is that once it is installed, it produces power forever (to a good approximation) without further inputs.

      The story with natural gas (fracked or not) is quite different. This is a consumable resource which only keeps producing power while we actively extract and burn it. In short, you will always be working harder to keep ahead of the demand--forever!

      The other thing that should be said about fracking is that well casings fail. In time, virtually every well casing will fail, causing methane gas to be released into the atmosphere. A significant fraction of the failures occur in the first few years of operation. However, the wells will have to be monitored for such failures FOREVER--long after the companies that drilled them are gone. So, with fracking we are bequeathing to future generations a problem that is comparable to nuclear waste.

      If we charged natural gas companies the "present value" of monitoring their wells FOREVER, the price of the gas they produce would be really high.

        CommentedJay Singh

        Indeed, you have appropriately highlighted the changes taking place in the social, economic and political landscapes across the world. Change is the only constant, a fact which we all know very well. However, whether it is only the tip of the iceberg or signs of things to come in the future, only time can tell.
        The cracks appearing in China is sure to get all the Governments around the world thinking. All of them need to re-think their strategies and formulate future blueprints for uplifting their manufacturing sectors.

        Regards,

        Jay

    6. CommentedThomas Haynie

      Fracking has it’s horror stories also. I wonder if the author considers the FULL economic costs. Communities that live near fracking sites must now BUY drinking water when filtered tap water was previously sufficient. A You Tube search will show bath tubs full of muddy brown oily water that burns.

      “The amazing truth is that fracking has succeeded where Kyoto and carbon taxes have failed. As shown in a study by the Breakthrough Institute, fracking was built on substantial government investment in technological innovation for three decades”…

      Right and investment in wind, solar and bio-fuels now will yield what later? Ha June Chang makes a pretty compelling argument with plenty of historical context for government investment in new technologies and industries. Without these infusions, subsidies and tax breaks potential new industries may never get off the ground. Not all investments pay off. Nobody can tell the future unless you are Bernie Maddoff. Furthermore, The concepts behind carbon tax credits have a list of successes and failures unless my Environmental Economics text book was written by a complete flake. It will obviously depend on structure of the programs implemented and depend on the commitment of politicians and legislators.

        CommentedGary Marshall

        Thomas,

        Stop telling lies. If you question my assessment, then stop living in socialist dream land and actually produce some facts.

        GM

    Featured