This is what Churchill might have called “the End of the Beginning”. It’s a big moment, but only because the UK has been so negligently slow to seize the environmental, strategic and economic opportunities. Had we moved ahead faster, we would already have the lower emissions, greater energy security, economic growth and taxes that shale can uniquely deliver in abundance.
Public misperception lingers, however, caused by the well-meaning but ill-informed environmental protesters who seem to dominate the debate. As Stephen Tindale, a former executive director of Greenpeace, will attest, shale gas is better for the climate than coal or imported liquefied natural gas, generating far fewer emissions and cleaner air. To argue against producing our own shale gas is really just to argue for increased imports of foreign (and increasingly fracked) gas. Is that what people really want, and is it in our national interest?
Like any new energy infrastructure, I don’t doubt that there will be some local disruption caused by hydraulic fracturing. I also don’t doubt that, with a fast-growing population, there will be no let-up in the demand for gas to heat our homes, cook our food and power a large chunk of our electricity.
And when a combination of the Health and Safety Executive, the Environment Agency, the Royal Society, the Royal Academy of Engineering, and the Department for Energy and Climate Change all believe a well-regulated fracking industry will be safe, I think we would be well-advised to believe them.
There have been some important developments since I wrote my first report on shale for the Institute of Directors five years ago which make me even more convinced of the benefits of fracking.
The first is that there is a lot more gas than we thought possible. The mid-range estimate from the British Geological Survey for the Bowland Shale in Lancashire is 1,329 trillion cubic feet (TCF). This is a stupendous figure when you consider we only consume about 3 TCF a year.
The second is that fracking in the US has been one of the reasons for the global collapse in the price of oil and gas, to the extent that Opec’s monopoly power appears to be waning. This has not been good for Venezuela, but it has been good for consumers. It may make shale extraction in the UK slightly less lucrative, but the truth is that we don’t know until companies are allowed to explore sufficiently.
The third is that the technology to extract the gas, oil and – crucially, for our petro-chemical industries – natural gas liquids like ethane is improving all the time. None of this would have happened without the profound impact of shale exploration and exploitation in America. It is to the US, the only country where fracking has happened at scale, which we should pay most attention. There are few calls stateside to stop fracking and go back to importing more gas, while rejecting the new jobs and tax revenues, and reversing the re-shoring of American industry.
America has left us in its wake, but now is the time to start catching up by giving companies the regulated ability to frack.