A win-win plan for the economy, the environment, and the low-carbon, cleaner-energy future
In a joint effort last week, the Harvard Business School (HBS) and the Boston Consulting Group (BCG) released a new report America’s Unconventional Energy Opportunity. The report finds that U.S. shale drilling provides immense opportunity for both the economy and the environment. The report was an independent research effort with no outside funding support, with BCG providing in-kind pro-bono support to this complex topic.
The report says the United States’ single largest source of competitive advantage and economic opportunity lies within its unconventional gas and oil reservoirs. Economically the benefits are profound, by 2030 these could be some of the results:
· Support 3.8 million jobs with wages twice the national median—half of which would be accessible to middle-skilled workers
· Produce average annual energy savings of $1,070 per household from low-cost natural gas, up from nearly $800 today
· Contribute almost $600 billion in annual GDP and $160 billion in government tax revenue from production-related activities alone, with ripple effects in energy-intensive industries such as plastics, metals, and heavy manufacturing
Additionally remarkable was the study highlighted the environmental triumphs that shale development brings. The environmental effects have been seen, and will continue to be seen in the progress the industry is making towards reducing greenhouse-gas emissions. This was no surprise to anyone working in the industry, when the report recognized that shale is speeding up our transition to a cleaner, low-carbon energy future. Natural gas is proving to be an inexpensive alternative in helping reduce air pollution and contributing to multiple new modes of transportation—natural gas powered vehicles, ships, and trains—which are cutting carbon.
Domestically the benefits we are reaping economically and environmentally are profound. But the study does not stop there; it goes on to accentuate how shale development will also bring geopolitical benefits. Having this resource and utilizing it for all of its returns will help to improve our energy security and cut back reliance on unstable regions. It also opens a new means for backing our trade deficit and building diplomacy abroad.
The primary risk would be failing to capitalize on this historical opportunity America has within its shale resources. The report observed how the U.S. is currently entangled in a misinformed and unproductive debate over hydraulic fracturing. A strong focus on “ban-fracking” campaigns across the U.S. with state and local oppositions is stalling progress. Instead of fully capitalizing on the opportunities, many areas stand in political gridlock.
We have seen this in Ohio, and continue to see it among local control groups. Lack of awareness on: regulations, environmental impacts and climate concerns cause these groups to rally in attempts to ban or delay development. When this occurs no one is winning.
Headway is starting to happen and will continue to progress as more people are seeing the benefits and recognizing that the opposition groups are spouting ill-informed information. A new poll by Robert Morris University shows that support for fracking is growing with increased awareness. About 56% of people polled nationwide said they support hydraulic fracturing from shale; this is up from 42% in November of 2013.
The take away is that shale is providing the U.S. with resources unimaginable just a few years back. The benefits are driving the economy, and will continue to as we develop our natural resources in an environmentally responsible and beneficial way. More people are continuing to see this side of shale, as the development of unconventional energy will offer an unparalleled competitiveness and U.S. opportunity for many years to come.