"The Next Frontier in United States Unconventional Shale Gas and Tight Oil Extraction: Strategic Reduction of Environmental Impact"
The unconventional fossil fuel extraction industry—in the U.S., primarily shale gas and tight oil—is expected to continue expanding dramatically in coming decades as conventionally recoverable reserves wane. At the global scale, a long-term domestic supply of natural gas is expected to yield environmental benefits over alternative sources of fossil energy. At the local level, however, the environmental impacts of shale gas and tight oil development may be significant. The development of technology, management practices, and regulatory policies that mitigate the associated environmental impacts of shale gas development is quickly becoming the next frontier in U.S. unconventional fossil resource extraction.
Expanding estimates of North America’s supply of accessible shale gas, and more recently, shale oil, have been trumpeted in many circles as the most significant energy resource development since the oil boom in Texas in the late 1920s. How large are these resources? What challenges will need to be overcome if their potential is to be realized? How will they impact U.S. energy policy?
To address these questions, the Belfer Center for Science and International Affairs and two of its programs ― the Environment and Natural Resources Program and the Geopolitics of Energy Project ― convened a group of experts from business, government, and academia on May 1, 2012, in Cambridge, Massachusetts. The following report summarizes the major issues discussed at this workshop. Since the discussions were off-the-record, no comments are attributed to any individual. Rather, this report attempts to summarize the arguments on all sides of the issues.
By Joseph E. Aldy, Faculty Affiliate, Harvard Project on Climate Agreements and Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements
Because of the global commons nature of climate change, international cooperation among nations will likely be necessary for meaningful action at the global level. At the same time, it will inevitably be up to the actions of sovereign nations to put in place policies that bring about meaningful reductions in the emissions of greenhouse gases. Due to the ubiquity and diversity of emissions of greenhouse gases in most economies, as well as the variation in abatement costs among individual sources, conventional environmental policy approaches, such as uniform technology and performance standards, are unlikely to be sufficient to the task. Therefore, attention has increasingly turned to market-based instruments in the form of carbon-pricing mechanisms. We examine the opportunities and challenges associated with the major options for carbon pricing: carbon taxes, cap-and-trade, emission reduction credits, clean energy standards, and fossil fuel subsidy reductions.
For the past forty years, United States Presidents have repeatedly called for a reduction in the country's dependence on fossil fuels in general and foreign oil specifically. Some officials advocate the electrification of the passenger vehicle fleet as a path to meeting this goal. The Obama administration has embraced a goal of having one million electric-powered vehicles on U.S. roads by 2015, while others proposed a medium-term goal where electric vehicles would consist of 20% of the passenger vehicle fleet by 2030 — approximately 30 million electric vehicles. The technology itself is not in question; many of the global automobile companies are planning to sell plug-in hybrid electric vehicles (PHEVs) and/or battery electric vehicles (BEVs) by 2012. The key question is, will Americans buy them?
By C. Edward Huang, Former Research Fellow, Environment and Natural Resources Program/Energy Technology Innovation Policy research group, 2009–2010
One question about the 2009 U.S. "Cash for Clunkers" program is whether it induced consumers to purchase greener vehicles than they would otherwise have purchased. This paper views the program as a natural experiment, which offered higher rebates to consumers buying more fuel-efficient vehicles, and shows that awarding an extra $1,000 on a vehicle made 7.2% of consumers switch. Hence the program - giving away nearly $3 billion - should have drawn many consumers to the subsidized greener vehicles, producing substantial environmental gains. This finding should interest policymakers evaluating similar programs to stimulate the economy while benefiting the environment.
By Mohammed Al-Juaied, Former Visiting Scholar, Energy Technology Innovation Policy research group, 2008–2009
This paper looks at ten different forms of public support for carbon capture and sequestration (CCS) technologies including investment tax credits, accelerated depreciation, production tax credits, loan guarantees, capital grants, allowance allocations, and storage tax credits. The paper compares the cost reduction potential of each option against a conventional coal-to-electricity facility without CCS.
By Henry Lee, Director, Environment and Natural Resources Program, Jose Gomez-Ibanez, Professor of Public Policy and Urban Planning; Faculty Affiliate, Environment and Natural Resources Program, C. Edward Huang, Former Research Fellow, Environment and Natural Resources Program/Energy Technology Innovation Policy research group, 2009–2010 and Grant Lovellette
The report is a summary of the discussions from a workshop on "Transportation Revenue Options" convened by the Belfer Center in May 2010. The workshop brought together 27 transportation experts for a two-day workshop to discuss three broad revenue-generating options: higher fuel taxes — perhaps supplemented by a carbon tax; fees collected based on vehicle miles traveled (VMT); and congestion fees on major roadways.
By Robert Lawrence, Member of the Board, Belfer Center for Science and International Affairs
This paper argues that the growing list of concerns about the impact of biofuel targets and mandates are the predictable result of a failure to follow the basic principles of good policy-making. Good policy-making requires developing a policy goal or target (i.e., reducing greenhouse gas emissions, reducing oil consumption, or increasing rural economic development) and designing an instrument to efficiently meet that particular goal. The more precise the goal, the better. In addition, for each target, there should be at least one policy instrument. You cannot meet two goals with only one instrument. This paper argues that the current U.S. biofuels mandates do not represent the most efficient or precise instrument to meet any of the policy's stated goals.
By Balachandra Patil, Former Research Fellow, Science, Technology, and Public Policy Program/Energy Technology Innovation Policy research group, 2009–2010
Expanding energy access to the rural population of India presents a critical challenge for its government. The presence of about 364 million people without access to electricity and about 726 million who rely on biomass for cooking indicate both the failure of past policies and programs, and the dire need is for a radical redesign of the current system that will address the need to expand energy access for these people.
April 14, 2010
The Dominican Republic is well positioned to benefit from the development of an ethanol industry. It has adequate land resources and, under favorable market conditions, can produce ethanol cost-competitively for both domestic consumption and export. The circumstances of the Dominican Republic are common to many developing nations considering biofuels development. The framework approach used in this paper and its conclusions may be applicable to biofuels initiatives in other developing nations.