Balcombe is a wake up call for local communities over Fracking


9:30 am - August 21st 2013

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by Philip Pearson

As Caroline Lucas MP was arrested at the Balcombe fracking site (19 August) she spoke of the “democratic deficit” being so enormous that “people are left with very little option but to take peaceful, non violent direct action.”

In 2012 the TUC’s annual Congress opposed gas fracking. Motion 43: “The principle of precaution should be applied when developing new energies and the health of people and the environment should be put before profit.”

And this summer, speaking up for gas fracking, the Prime Minister told the Express, “I want all parts of our nation to share in the benefits: North or South, Conservative or Labour … we can expect to see lower energy prices in this country.”

Balcombe jpeg lorry

From Balcombe

But will gas fracking will mean lower energy prices? Not according to Alistair Buchanan , chief executive of Ofgem, the energy regulator: “It is true that the US has transformed its energy market thanks to shale, but in our time-frame, when Britain will rely on gas for its power stations, this is not going to happen on any significant scale, either here or elsewhere in Europe.

Even if the US allows exports (and assuming they come to Europe), it will still cost about the same as we are paying for our winter gas now. No one doubts that there is plenty of gas out there, but what is critical to Britain is how much will be available over the next five years and how much we will have to pay for it to ensure that it comes here.”

Does public support count? The Prime Minister argued over the summer that “If neighbourhoods can see the benefits – and get reassurance about the environment – then I don’t see why fracking shouldn’t get real public support.” But what if it doesn’t? The NoFIBs petition (No Facking In Balcombe Society) was supported by 82% of local residents. It, too, is based on the precautionary principle:

The work of Cuadrilla poses an unacceptable level of risk to our water supply, air purity and overall environment. We, the undersigned, stand opposed to exploratory drilling or fracking for gas or oil because we believe that these activities put human health at risk, both of those living close to wells, but also of those whose water comes from an affected area.

The TUC motion originated from protests supported by trade unions and community organisations in the North West, where Cuadrilla first made the earth tremor. It adds: “The fracking method of gas extraction should be condemned unless proven harmless for people and the environment. This type of energy production is not sustainable as it relies on a limited resource. Until now, there is evidence that it causes earthquakes and water pollution and further investigation should be carried out before any expansion.”

Balcombe drill

In a field outside Balcombe village…

What of the environment? At Balcombe on a day visit, I had a long conversation with a local resident about the diverse environmental impacts of Cuadrilla’s drilling operation – see photo. The continuous noise, vibration and 24-hour lighting had driven birdlife, bats and badgers away. She feared the long term effects of injecting millions of gallons of chemical laden water to frack the gas on water pollution – the water table lies at 700 feet below ground level, the shale gas at 3000 feet down, so the drill pierces the water table. A few days later we also spoke about methane gas escapes and flaring.

She said, “We’ve been ignored. The petition, our planning objections, letters to MPs, our demonstrations haven’t stopped them. 10,000 people might.”

Who fills the gap politics has vacated? Speaking at the a recent Friends of the Earth meeting, John Ashton, for ten years the government’s roving climate change ambassador, argued that the struggle on climate change “is now entering a decisive phase.” The words Must, Now, Can should guide our thinking: “We must do whatever it takes. Otherwise the consequences of climate change will undermine security and prosperity. We must build a carbon neutral energy system, within a generation.”

But, he said, “The fact is, we can’t fix the climate problem, or any of the other problems on the agenda you have set, unless we can now fix politics itself. ” His prescription is to “Fill the gap that politics has vacated. Connect with the base of society. Mobilise coalitions to offer people solutions to problems that politics in its current form ignores. And do that on the basis of a more strategic assessment than I suspect you have of what is to be done and where you can change the game.”

And, as I was speaking with a local resident last week, a child ran by: “I love waking up in the morning here!” she said.

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Reader comments


“She said, “We’ve been ignored. The petition, our planning objections, letters to MPs, our demonstrations haven’t stopped them. 10,000 people might.”

It hasn’t worked with windfarms. But then, they didn’t have the Rainbow Rentamob on call.

My instinct is to be against fracking, because I can’t see any real benefits for people in their pockets. It will be big business that rakes in most of the profits. And they will try to minimise their taxes like Google etc no doubt.

The global warming argument doesn’t do much for me, but the damage to the immediate environment one does.
In the USA coal mining and oil and forestry really does do local damage to the environment, but they have enough land to be able to just walk away from some places they’ve dispoiled – like in parts of Pennsylvania – and we in Britain haven’t got that space.

I can’t have any common cause with the Balcombe protesters though because of the class of people they are. They’re the Eco-Green Direct Action Tribe. To me they’re just an embarassing joke … but I do understand that’s purely class prejudice on my part.
If they didn’t come across as so ridiculous then I could take them more seriously.

http://www.nasdaq.com/markets/natural-gas.aspx?timeframe=5y

Above is a link to US nat gas prices over the last 5 years. As you can see, they’ve halved.

The article above seems to be written in a way aiming to decieve. It’s true that US natural gas rpcies have little effect on European ones. It’s also true that fracking in the UK will have little effect on gas prices for the next 5 years.

That’s really not the point though. With more than 50 years of supply availabl ein the UK alone, the next 5 years as fracked gas supplies come on line really aren’t important, nor would you expect costs to go down much when supplies are low. The argument made is a total straw man.

It’s also nice to see the Unions hopping from one hypocritical foot to the other against fracking, yet the same people defending coal mining and other heavy industry and blaming Thatcher for it’s loss.

As for the environment – surely green types would be in favour of fracking, given it has much less impact on the surface than any other energy source, and is much cleaner and better for the environment than the coal fired plants we currently use. Clearly in their view it’s better to strip-mine large parts of the world in foreign countries than drill a feww small holes in Lancashire.

It feels like the opposition to fracking is really just an extension of the anti-capitalist meme currently being touted by the left, the unions and their occupy style rent-a-mobs. I’d also imagine many of them would drop their opposition to fracking very quickly if the companies drilling were state-owned rather than private.

@damon

“because I can’t see any real benefits for people in their pockets. It will be big business that rakes in most of the profits. And they will try to minimise their taxes like Google etc no doubt.”

Most of the profits made by extractive industries get taken in taxes. It’s why Scotland wants its North Sea oil back.

It’s also very difficult for such industries to engage in the tax avoidance techniques used by virtual, global entities like Google.

The continuous noise, vibration and 24-hour lighting had driven birdlife, bats and badgers away.

Flying straight into the friendly wind turbines, no doubt…..

(OK not the badgers!!!)

There is no logical argument to be made against fracking. It is a relatively clean technology that can be developed without ludicrous subsidy and will result in lower, perhaps much lower, energy bills for all.

But of course the sandal munchers of West Sussex do not respond to logical arguments but instead react to furry emotional triggers, false visions of some pastoral paradise and an irrational fear of the unknown.

They need to understand the facts- there is no downside to fracking.

5. pagar
"There is no logical argument to be made against fracking" Oh, they are numerous.
"without ludicrous subsidy " Cameron is throwing £millions taxpayers’ money at drilling companies.
"will result in lower, perhaps much lower, energy bills for all." Why do you think that you’re right about gas prices and the Chief Executive of OfGem is wrong.

3.Tyler
Much as you’d like it to be an adversarial, left wing vs right wing, matter it is too important for political foolery and your stereotypical stereotyping does nothing to the debate..

” ‘without ludicrous subsidy’ Cameron is throwing £millions taxpayers’ money at drilling companies.”

I’ve always found this a bizarre argument too; a constant insistence by some that renewable energy can only work with ludicrous/giant/humongous/astronomical/gargantuan/pan-galactic-gargle-blasting subsidies. Subsidies for fracking though; they’re OK with that.

@Tyler

“surely green types would be in favour of fracking… Clearly in their view it’s better to strip-mine large parts of the world in foreign countries than drill a feww small holes in Lancashire.”

I have a question. Are these thoughts that honestly form in your brain, or do you just look to say patently ridiculous things purely to see what the reaction will be?

@ Ceiliog

A tax break is not a subsidy. Renewables require cash input from government to operate, fracking is subject to some tax breaks for set-ups. Different.

“Why do you think that you’re right about gas prices and the Chief Executive of OfGem is wrong.”

Because he was talking about the short term (5 years) and about the effect of US fracking on UK prices.

You are right – it is too important for political tomfoolery. Yet look at hysteria presented about fracking coming from the left, not least this blog.

@ AndyC

Again, tax breaks are not subsidies.

The unions are against fracking, but complain endlessly about Thatcher and the de-industrialisation of the North of England. Not sure why this naked hypocrisy is ridiculous.

10. Man on Clapham Omnibus

3. Tyler

‘With more than 50 years of supply available in the UK alone’

Is this verifiable?

‘As for the environment – surely green types would be in favour of fracking, given it has much less impact on the surface than any other energy source, and is much cleaner and better for the environment than the coal fired plants we currently use’

I think anybody with any concerns for the future must consider not only direct environmental impacts associated with drilling but also the consequences of wider pollutants to the air (eg methane release) or water (chemical release) and whether all externalities are properly assessed in relation to probability of environmental damage, impact and costs and possibility of resolution. I would speculate that the Fukushima Daiichi plant would have fared badly in these terms in retrospect.
My understanding is that assessment of potential water table pollution is not publicly available due to the inclusion of undisclosed additives.

You also contrast coal with oil in your comment.Neither is desirable given longer term compliance with Global warming emissions and probably unsupportable if anyone is still serious about limiting temperature rises to below 2 degrees. At over 245ppb of greenhouse gasses in the atmosphere we have a lot of back pedaling to do.

Ultimately, the solution is in the numbers not the politics. Sadly what starts out to be great ideas can often turn around and haunt you. Cameroon ‘Greenest government ever’ may well end up to be the dirtiest.

11. Man on Clapham Omnibus

9 Tyler

‘A tax break is not a subsidy’

If tax breaks lower the market cost to the producer,then the producer is being subsidised.

Even if the US allows exports (and assuming they come to Europe), it will still cost about the same as we are paying for our winter gas now. No one doubts that there is plenty of gas out there, but what is critical to Britain is how much will be available over the next five years and how much we will have to pay for it to ensure that it comes here.”

As Tyler points out. There won’t be any effect on UK prices for the next five years as we’ll not be fracking in any quantity in the next 5 years.

There is actually a report out there about the effect of European fracking on UK gas prices though. By Poyry. With fracking gas prices stay at about 40p a therm into the future. Without it they rise to 80 p a therm in the future. And that’s before we start to look at Cuadrilla’s finds in Lancashire.

I reckon 50% off gas prices is a benefit for people, don’t you?

13. MarkAustin

Why are they protesting about frackiong in Balcombe? They’re not doing any. It’s a bog-standard old-fashioned oil well.

We haven’t got enough water here in Sussex as it stands. Then there’s this: http://pubs.acs.org/doi/abs/10.1021/es4011724

Plus, of course, the need to reduce our dependence on fossil fuels.

12.
Compare what you say that Pöyry has reported with what Pöyry has reported.
‘Shale gas won’t lead to a collapse in UK gas prices’ says Pöyry.
Published on 6 Aug 2013
Richard Sarsfield-Hall, Senior Principal at Pöyry Management Consulting, told Proactiveinvestors that shale gas development in the UK won’t lead to a collapse in gas prices. This is because, unlike America, which has become nearly self-sufficient for gas, Britain is connected to the worldwide gas market via liquefied natural gas and via pipelines to Europe and Russia, and those prices will be not be directly affected in the same way, he argued. Shale gas would, at the most, cover 25% of what is needed in the UK, he stressed.
Link to interview Richard Sarsfield-Hall, Senior Principal at Pöyry Management Consulting:
https://www.youtube.com/watch?v=3EakcC8ngR4&list=UU6zHYEnBuH4DYxbPLsbIaVw
(Copied from an earlier post by Bern Babibhurn to Tim Worstall on another thread)

On a related matter. The USA is using shale gas in place of coal. Coal is still mined in the same quantities as before but it is exported to China.

@Tyler

“The unions… Not sure why this naked hypocrisy is ridiculous.”

Your original quote wasn’t a reference to unions, it was a reference to the position of “the greens”, that’s why it was patently ridiculous. So my original question still stands; do you really think these things, or are you just writing it for the sake of disagreeing with a group you dislike (despise?)?

> Again, tax breaks are not subsidies.

I find this such a disingenuous argument. If it ends up making an investment more financially attractive to a company by either decreasing costs or increasing profits, then (inline with what Man on Clapham Omnibus said) the real-world impact is the same, and it should be viewed in that light.

@MarkAustin

“Why are they protesting about frackiong in Balcombe? They’re not doing any.”

They’re concerned about what might follow. If you’re concerned about what might happen in an area near you, it’s preferable to protest before that thing happens, rather than after.

Compare what you say that Pöyry has reported with what Pöyry has reported.

Yah.

I went through this in detail here:

http://www.forbes.com/sites/timworstall/2013/08/15/its-always-difficult-to-tell-whether-greenpeace-is-deliberately-misleading-or-simply-deluded/2/

Tim Worstall at 9:01pm
What about interview with ProActiveInvestors that I linked in my comment of 5:49pm? Is that deluded?

Tim Worstall at 9:01pm
I followed your link to the article posted by you and it seems that you are referring to a press release by Pöyry from November 2012 and puff from Cuadrilla.
Also, I visited your blog. Calling anyone who disagrees with you morons and cretins? – Oh dear. No wonder that your book is tagged with Delingpole on the Amazon website.
How are things at the Ignoring Adam Smith Institute?

Meanwhile, elsewhere on the Internet…
http://m.smartplanet.com/blog/take/might-as-well-face-it-youre-addicted-to-oil/1069

Gas, like oil, and coal, is a fossil fuel. Lets see what Tyler & Tim Worstall have to say about this. Que denialism from Tyler, he’s incapable of anything else. Be more interesting to read what Tim has to say though.

“Gas, like oil, and coal, is a fossil fuel.”

Well spotted. And we are going to be burning gas irrespective of whether we produce it or pipe/ship it in. Burning lots, because it’s by far our biggest energy source and for the medium term neither nukes nor renewables has a hope in hell of doing the job.

So the real choice is who gets the jobs, the investment, the control over environmental standards and the big, fat tax take. Us, or Putin and some Qatari princeling. Oh, and whether the latter get to control supply and market price.

Classic no-brainer.

@ MoCO/Andy C

No, a tax break is not a subsidy. A company can treat both similarly in accounting terms, but the exchequer cannot.

A tax break is where you ask less tax from an industry, but it is still a benefit, not a cost to the exchequer. A subsidy is a direct cost to the exchequer.

@ Dissident

Not sure what point the little rant you link makes. Sure, it would be lovely if we weren’t reliant on fossil fuels, but there is no cost/benefit analysis. Apart from no alternative being mentioned, what would the cost be to the world economy if we did “go green” and stop using as much oil.

My guess is the world would get dramatically poorer as energy prices increase.

@22

“Not sure what point the little rant you link makes. Sure, it would be lovely if we weren’t reliant on fossil fuels, but there is no cost/benefit analysis. Apart from no alternative being mentioned, what would the cost be to the world economy if we did “go green” and stop using as much oil.

My guess is the world would get dramatically poorer as energy prices increase.”

I knew you wouldn’t get it. In the case of America, where you tout the ‘reduction’ in prices due to fracking, companies like Exxon face (localised) bankruptcy because of it. What happens when the actual costs locally exceed prices charged? Closure of that particular part of the company. Or are you suggesting that Exxon et al keep their purely American infrastrucure operating at a loss, with the rest of Exxon worldwide carrying its loss making domestic operations? Would you accept that at the next shareholders agm, or pressure the executive to do what you pay them to, maximise profit ie close lossmaking American infrastructure? The notion that fracking would lower prices is a delusion.

It is obvious from the kind of comments you have repeatedly made that any and all green/sustainable arguments are rejected by you out of hand – especially when they are logical and backed up by both scientific hypotheses and empirical evidence, so here is one of your favourites spelling it out for you. Enjoy.

http://www.rigzone.com/news/oil_gas/a/118907/Exxon_CEO_Losing_Our_Shirts_On_Low_Natural_Gas_Prices

http://www.4-traders.com/EXXON-MOBIL-CORPORATION-4822/news/Exxon-CEO-Losing-Our-Shirts-on-Natural-Gas-Prices-14389715/

Ironic isn’t it Tyler, costs are increasing anyway. So your last sentence is invalid, as this paragraph of the article spells it out clear as day.

“U.S. natural-gas prices–which fell below $2 a million British thermal units earlier this year to the lowest level in a decade–are not sustainable, as energy companies won’t be able to continue drilling unless prices rise, Mr. Tillerson said during a breakfast event in New York.

“We are losing our shirts,” said Mr. Tillerson.”

So much for relying on fossil fuels eh?

“No, a tax break is not a subsidy. A company can treat both similarly in accounting terms, but the exchequer cannot.”

That’s some impressive cognitive dissonance in play. The complaint is that renewables are only viable if they get some form of financial support, but give it to oil and gas industries and suddenly it’s the Government accounting that counts. Nice.

“So much for relying on fossil fuels eh?”

So you’re upset that fracking has reduced US gas prices so much that some producers are making a big loss, while businesses and consumers are enjoying cheap energy and the Fed is raking in the tax dollars.

I’m not sure how well this argument will resonate with the general public, to be honest.

27. Mug and Market

@Richard T
Dissident doesn’t appear to be upset.
Are you upset that drilling companies will not extract the shale gas because the price is too low to make it worthwhile?

“Dissident doesn’t appear to be upset.”

OK, hysterical then.

It’s a classic boom.

Everyone piles in, buying drilling rights at inflated prices and overborrowing against inflated cashflow projections, etc.

The high-cost and terminally leveraged players will exit, oversupply will ease downwards, the price will ease upwards.

The notion that shale gas will cease to be pumped is frankly deranged. (As, before you’re tempted to voice it, is the notion that the price will shoot back up to pre-shale levels.)

Supply, demand, price.

Not rocket science.

@26
You do understand the implications of exxon’s fracking operations trading at a loss, in America’s legalistically protected market don’t you? Either they will get even more subsidies than they do now, they shut down those operations or export to the global market. One of those options is precisely what is campaigned against with renewables (even though renewables are dropping in price naturally as economy of scale and efficiency are both improving dramatically) or the consumer pays extra because they are placed on the open market, or price goes back up because they are no longer extracted. Is there any of that you need explaining clearer?

And don’t forget the era of cheap fossil fuels was squandered because people chose to buy seriously inefficient vehicles, build huge sprawling suburbs and exurbs and jet off around the world on a whim. People chose this route out of their own short term selfishness. We could have been smarter than that and now it’s too late.

http://www.peakoil.net/

Cheap fossil fuels have gone, and we have collectively screwed up our future prosperity because we ignored the fact that they are finite. Instead of investing properly in renewables decades ago we have also squandered much of our collective wealth on resource wars in the middle east.

http://costofwar.com/

http://www.smartgridnews.com/artman/publish/Business_Markets_Pricing/Renewables-are-already-at-grid-parity-in-a-few-places-with-more-to-come-5907.html#.UhYOeKa9LCQ

http://www.ewea.org/blog/2013/04/cost-of-renewable-energy-is-falling-reports-say/

Worse, we have passed on to our children and the wider environment the consequences of such stupidity.

http://www.theguardian.com/environment/2012/sep/26/climate-change-damaging-global-economy

http://extinction-workshop.psu.edu/abstracts/brooks.pdf

http://thinkprogress.org/climate/2013/04/11/1854651/arctic-sea-ice-the-death-spiral-continues/

There are literally thousands of similar sites where you can see what is happening. Now. My question for you is simple, is continuing down the fossil fuel addiction’s death spiral a smart thing to do?

“It’s a classic boom.

Everyone piles in, buying drilling rights at inflated prices and overborrowing against inflated cashflow projections, etc.

The high-cost and terminally leveraged players will exit, oversupply will ease downwards, the price will ease upwards.”

In other words, yet another example of tulip mania, leading to mugs becoming out of pocket. Your blind faith in such events is touching…

@ Dissident

Not sure you understand any economics. Supply and Demand. New supply has forced prices down. This is a good thing for the economy as a whole, though not for the suppliers. When it becomes un-economical, suppliers will shut off some production, which pushes prices back up till it is economical again.

The cycle continues bouncing around, but overall the cost has still decreased for the consumer. Which on the whole, is good for the US economy.

@ Andy C

Cognitive dissonance? Not sure if you have the capacity to understand the problem. But here goes. Again.

Tax breaks and subsidies both reduce the cost of production for a company equally.

The Exchequer doesn’t enjoy the same treatment. Tax breaks mean reduced revenue – but it still sits on the ASSET side of the balance sheet, as revenue still comes in. Subsidies are a COST and sit on the LIABILITY side of the balance sheet.

Tax breaks are NOT the same as subsidies.

@Tyler

You keep missing the point. The financial argument from people against renewables is that *companies* can’t make it profitable without financial support, and that such financial support should not be given by Government. Yet here, the provision of tax breaks to a company, resulting in a reduction in tax revenue, which either prevents Government spending in other areas or requires additional borrowing to meet spending commitments gets treated differently. Either fracking isn’t financially viable without the financial inducements, in which case, surely you should be against it for consistency, or the Government is inappropriately padding the profits of a private company when the lost revenues could be put to better use elsewhere. also, would you be ok with tax breaks for renewables investment?

@Tyler

For clarity, I’ll just add this:

This is not an argument about what to call something, or where it sits on a balance sheet. Such arguments are an attempt to distract from the underlying issue, which is whether or not a particular approach to energy provision can be financially viable without any inducements, however provided, whatever you call them (which was my point from the very beginning). If fracking is a self-sustainable endeavour for a private company without financial inducements, then why are any being given? If it isn’t, then why are the same objections (i.e. it should be self-sufficient) not applied to fracking?

@ Tyler

I’m not sure you understand the meaning of ‘finite supply’. The price of fossil fuels is inexorably going upwards as readily available ‘cheap’ and easily extracted stocks become depleted. We are no longer in the mid 20th century, haven’t you noticed that? Or are you going to blindly cling to temporary peaks & troughs in an overall upward trend?

http://www.sciencedirect.com/science/article/pii/S0306261909003912

And this graph spells it out in dollars of the day and relative to 1983 dollar value. Is it going down at all?

http://4.bp.blogspot.com/-wo6I_3Rz7n4/UFU-L8E0ZUI/AAAAAAAAAO4/MUbKa0ULuNc/s1600/MonthlyUSOilCost.jpg

“The Exchequer doesn’t enjoy the same treatment. Tax breaks mean reduced revenue – but it still sits on the ASSET side of the balance sheet, as revenue still comes in. Subsidies are a COST and sit on the LIABILITY side of the balance sheet.”

Arbitrary definitions. Taking away a negative number in an equation is functionally identical to adding a positive number. The arbitrary definitions above are the politics of sweetening the pill for the gullible.

@ Andy C

“which is whether or not a particular approach to energy provision can be financially viable without any inducements”

Fair enough question. The normal situation is that over time fracking etc will be profitable for a private company. Setup costs are very large though, and there is a time delay before you are actually making any money.

This is normally debt financed, which is gettiing harder and more expensive to do as effective rates are rapidly rising. So governments offer a tax break to soften the blow and make it easier for the initial investments to happen. Once the industry is mature those taxes tend to get raised quite quickly (look at petrol for example).

The problem with the bulk of renewables is that the whole industry becomes non-viable without massive long term subsidies as the energy it generates is never cost effetive or profitable. South Africa is in the process of signing the deals for a series of large Green Energy deals. Having worked on (the financing) for them, I can tell you for free that none of them will ever turn a net profit with massive government subsidies. If not for South Africa’s woeful undercapacity for power generation (Eskom pays some manufacturers to turn their production lines off at peak times) they simply wouldn’t be happeneing.

@ Andy C

Sorry didn’t see the post at 31. To add:

“Yet here, the provision of tax breaks to a company, resulting in a reduction in tax revenue”

This isn’t true. The tax breaks may lead to new industry and new tax revenues. GDP growth isn’t a zero sum game. If costs/taxes are too high, that industry might never happen. You also have to account for the increased growth and hence tax revenues from lower energy prices, allowing people to invest/spend on other things.

“also, would you be ok with tax breaks for renewables investment?”

Certainly, and tax breaks do already exist. Much more happy than subsidising them. The problem is that the majority of renewable schemes are simply not profitable and require subsidies to exist, let alone turn a profit. Frankly I’d be happy if renewables schemes were tax free as long as they didn’t have to be subsidised and don’t push up energy prices.

Proving yet again that there is no such thing as a free lunch.
Gas prices will not reduce if shale gas is extracted in Britain. If the wholesale price of gas is too low, drilling for more will not take place.
The major waste product, ‘spent water’ is so toxic that it has to be buried in deep holes. Companies involved will ‘externalise’ as much of the cost as they can get away with and the taxpayer picks up the bill. Plus ça change….
Tim Worstall "I reckon 50% off gas prices is a benefit for people, don’t you?" In a world of fantasy.

“The problem with the bulk of renewables is that the whole industry becomes non-viable without massive long term subsidies as the energy it generates is never cost effetive or profitable. South Africa is in the process of signing the deals for a series of large Green Energy deals. Having worked on (the financing) for them, I can tell you for free that none of them will ever turn a net profit with massive government subsidies. If not for South Africa’s woeful undercapacity for power generation (Eskom pays some manufacturers to turn their production lines off at peak times) they simply wouldn’t be happeneing.”

And here is a link to what is happening to the cost of solar per MWH. It is already at parity with fossil fuels. Without wars over dwindling stocks and other global problems.

http://www.seco.cpa.state.tx.us/publications/renewenergy/solarenergy.php

@Tyler

“The tax breaks may lead to new industry and new tax revenues. GDP growth isn’t a zero sum game.”

Now this I have a big problem with, as the fiscal multipliers for revenue can historically be seen to be “very small and not statistically significant” (in contrast to spending multipliers):

http://www.imf.org/external/pubs/ft/wp/2012/wp12286.pdf

On the wider issue of the long-term profitability of renewables, data do not paint nearly as bleak a picture as you do even without considerations like the healthcare cost of air pollution:

http://www.eia.gov/oiaf/aeo/electricity_generation.html

http://pubs.aeaweb.org/doi/pdfplus/10.1257/aer.101.5.1649

” It is already at parity with fossil fuels.”

Phew. We can stop those eye-watering subsidies then.

@Richard T

“We can stop those eye-watering subsidies then.”

I’d like to see some eye-watering subsidies being stopped, specifically the $1.9 trillion in global subsidies for fossil fuels:

http://www.imf.org/external/np/sec/pr/2013/pr1393.htm

A few quotes of note from the piece:

“subsidies are often inefficient and ‘could be replaced with better means of protecting the most vulnerable parts of the population.'”

“subsidies most often take the form of taxes that are too low to capture the true costs to society of energy use (‘tax subsidies’)” (wish I’d spotted that one earlier)

“Eliminating energy tax subsidies would deliver even more significant emissions reductions”

Richard T
The incentive to install solar power is pitiful when compared with how fossil fuel is subsidised.
Solar power has a one-off payment, whilst subsidies for fossil fuel are endless.
On top of the generous subsidies, imagine if Big Oil had to pay for all the security that the military and other government services provide.
Externalisation, that’s the name of the game
and each generation gets fooled again

I am in no way a person who holds extreme views on socio-economic systems but, please Richard T and all you twisted shills, stop trying to con people on a website for people of reason.

“I am in no way a person who holds extreme views on socio-economic systems but, please Richard T and all you twisted shills, stop trying to con people on a website for people of reason.”

It’s more a case of they’re desperate to drown out the -ahem- inconsistencies in their paymaster’s doctrine, it’s as if they are writing the fig leaf to cover their neoliberal emperor’s modesty 😉

I tried posting this last night, but it doesn’t seem to have appeared, so:

“We can stop those eye-watering subsidies then.”

If you’re talking about stopping eye-watering subsidies, I would suggest starting with the $1.9 trillion of fossil fuel subsidies:

http://www.imf.org/external/np/sec/pr/2013/pr1393.htm

Some interesting quotes from this piece:

“subsidies are often inefficient and ‘could be replaced with better means of protecting the most vulnerable parts of the population.'”

“Energy subsidies also reinforce inequality”

“subsidies most often take the form of taxes that are too low to capture the true costs to society of energy use (‘tax subsidies’)” (wish I’d spotted this earlier)

@ Ceiliog

“Gas prices will not reduce if shale gas is extracted in Britain. If the wholesale price of gas is too low, drilling for more will not take place.
The major waste product, ‘spent water’ is so toxic that it has to be buried in deep holes”

You are just getting hysterical and making stuff up now. If you increase supply, prices will go down. Evenutally some wells might not be economical, which will likely drive prices up slightly again, but that does not make the whole industry unprofitable. You can see what fracking has done for US gas prices. As for spent water being so toxic it needs to be buried….it’s not nuclear waste, and nor is it particularly toxic. Less so than a glass of scotch anyway.

“Solar power has a one-off payment”

If only this were true. Solar panels wear out, and it ignores totally the cost of back-up generation. The sun does’n’t always shine, sunshine.

@ Dissident

I quote: “Finally, other solar applications such as distributed photovoltaics are expected to be cost-effective within 10 years, but in the meantime can be made cost-effective for customers today through a combination of federal, state, and utility subsidies and policies.”

Nuff said really. Solar is also significantly more efficient than wind as well, but less suitable for large scale power generation.

@ Andy C

Really depends on the country. South Africa, as I say, is so tight on generation that any new power supplies will have a major effect on growth. Probably not so much for the UK, but as fuel prices come down it should allow consumer spending to go up, with the GDP mulitplier effect being second order rather than first order.

Levelised costs for wind are roughly where they are for fossil fuels but importantly, this ignores the backup generation costs and variability (as shown by the low capacity factor in your links). Solar is still much more expensive.

“Solar power has a one-off payment”

Well, no. The clue is in the ‘tariff’ part of the term ‘feed in tariff’.

There’s nothing wrong in principle with providing financial incentives for particular investment patterns, we do it all the time, but you have to wonder whether – for example – my landowning neighbours’ current windfarm income projections comprising a payback period of a few years followed by a couple of decades of pure profit is a particularly good use of scarce resources.

btw, the ‘shill’ meme doesn’t really mesh with the ‘people of reason’ thing. Just for the record, I’m posting from an off-grid smallholding powered by PV, solar DHW, micro-wind and woodfuel, and there’s a nice little enamel award plaque for sustainable design outside the back door. Oh, and a diesel genset for battery-charging when the wind don’t blow and the sun don’t shine which, in the current context, is rather the kicker.

@44

“If only this were true. Solar panels wear out, and it ignores totally the cost of back-up generation. The sun does’n’t always shine, sunshine.”

“Levelised costs for wind are roughly where they are for fossil fuels but importantly, this ignores the backup generation costs and variability (as shown by the low capacity factor in your links). Solar is still much more expensive.”

Trying to patronise with misinformation is amusing Tyler!

Do you actually keep up with scientific developments? It’s only a matter of time before this comes online. Not only that, but there are already lots of other ways of storing power that already exist. Do try to keep up, or are your fossil fuel paymasters going to try to suppress stuff like this, as they have at every stage of what really should be the 2nd industrial revolution?

http://m.phys.org/news/2013-07-material-big-energy.html

As for solar panels wearing out, are you seriously trying to use the fact that literally anything ever built, including your favourite mid 20th century dirty power generation technology, has a limited lifespan? Wow, I’m impressed at what you can cobble together with straw… Difference is, the materials used in the manufacture of solar photovoltaics are fully recyclable. Can you say the same about burnt fossil fuels?

http://www.renewableenergyfocus.com/view/3005/end-of-life-pv-then-what-recycling-solar-pv-panels/

““Gas prices will not reduce if shale gas is extracted in Britain. If the wholesale price of gas is too low, drilling for more will not take place.
The major waste product, ‘spent water’ is so toxic that it has to be buried in deep holes”

You are just getting hysterical and making stuff up now. If you increase supply, prices will go down. Evenutally some wells might not be economical, which will likely drive prices up slightly again, but that does not make the whole industry unprofitable. You can see what fracking has done for US gas prices. As for spent water being so toxic it needs to be buried….it’s not nuclear waste, and nor is it particularly toxic. Less so than a glass of scotch anyway.”

Here is a list of the most common chemicals used in fracking. If they’re not particularly toxic, I’d recommend you go drink some ‘eau de frak’ yourself. Go on it’ll taste nice and sweet from the mutagenic benzene! The hydrochloric acid and ammonia etc will give it well rounded and complex overtones of other forms of cellular damage too. You’d love it!

http://marcellusdrilling.com/2010/06/list-of-78-chemicals-used-in-hydraulic-fracturing-fluid-in-pennsylvania/

Meanwhile the rest of us might sanely wish that this complex brew doesn’t get anywhere near the water table that millions of people’s drinking water is extracted from. But then the subsidised profits of the fossil fuel paymasters is all you care about. The hell with everything else, right(wing)?

@ Dissident

http://www.eia.gov/oiaf/aeo/electricity_generation.html

Please tell me how we can store that green-generated power in the capacity and scale required, because batteries/capacitors dón’t work on large scales, and have other associated problems. The example you give is for Titanium oxide based capacitors. Titanium being expensive and hard to work, I can see these things being very effective, but also very expensive.

I actually know something about this industry and there is basically only one way of doing it cost-effectively, but it isn’t a solution for most areas. If you know how to do it some other way, go patent it and become a billionaire.

You’ll also notice from the link above that solar is expensive and has a very low capacity factor – meaning it needs perptual back-up generation to work.

As for frack juice (why do I have to repeat myself so many times) you are breathing in more benzene from car exhausts and every time you use a aerosol deoderant than any likely amounts from frack juice. There are plenty of benzene derivatives in drinks like whisky as well, but I don’t hear any complaints there. Hydrochloric acid is nasty when concentrated – except frack juice doesn’t use concentrated HCl. Dilute HCl is used in swimming pools….again, I assume you wouldn’t ban swimming pools as a health risk. Ammonia is used in fertilisers (apart from a huge amount of other things), and it ends up in drinking water, as well as the food you eat. Just because it has a scary name doesn’t mean it is bad for you.

All it seems here is that you don’t have any real understanding of the process or the chemicals involved, and you are simply scaremongering in a typically hysterical way. If you are so worried about the water we drink, you would probably be better of campaigning about all the other waste we pour daily into our rivers and streams – indutrial waste, human waste and agricultural run-off – before you start on about fracking.

“But then the subsidised profits of the fossil fuel paymasters is all you care about.”

And then the loony-lefty conspiracy nut comes out to take a turn on the dance floor. QED.

@ Dissident

oh, and actually read the link you posted:

http://marcellusdrilling.com/2010/06/list-of-78-chemicals-used-in-hydraulic-fracturing-fluid-in-pennsylvania/

Some highlights:

“UPDATE (July 6): It seems the list below is not completely accurate, as admitted by the PA DEP. The list below includes chemicals and substances stored on site (like diesel fuel and oil) that are not injected into the ground.”

“We do know that fracking fluid is composed of less than one percent of the chemicals in this list, with water and sand making up the other 99 percent.”

“When fracking fluid is pumped into the ground, the vertical hole down which it’s pumped is lined with concrete to protect surface water supplies from chemicals. The fracking fluid goes down some 5,000 feet to where it’s used to help break rock apart releasing the natural gas, and then most of the fluid is pumped back out again and carted away where it’s treated at a regulated and approved facility. For the fluid that stays behind, it’s down some 5,000 feet. That’s almost a mile of solid rock between where it sits and surface water supplies (which are located at about 300 feet). There’s no way any of that fluid will “seep up” into water supplies. And remember that most fluid is pumped back out again. So less than one percent of the fluid are chemicals from this list, and most of that comes out again, leaving behind a very very small amount of chemicals a mile below the surface and heavily diluted by water and sand.”

“Range Resources, which uses contractor Frac Tech for its fracing work, says its frac fluid additives are chosen from a list of only nine compounds — hydrochloric acid, methanol propargyl, polyacrylamide, glutaraldehyde, ethanol, ethylene glycol, alcohol and sodium hydroxide.”

So basically, the scare story about fracking fluid is taken from shoddy research where they have conflated *all* of the chemicals used at the site, most of which are NOT injected into the ground, with the few that are.

Maybe read before you put up a post, because that one directly contradicts your argument and in the process makes you look like a bit of a moron.

All it seems here is that you don’t have any real understanding of the process or the chemicals involved, and you are simply scaremongering in a typically hysterical way.

As a fence-sitter, that is what turns me off the anti-frackers. They talk about earthquakes or earth tremors, but it turns out they are of the same magnitude as those caused by the double-decker buses that pass my flat every ten minutes. They talk about chemicals but it turns out those chemicals are pretty unavoidable in everyday life. They do not discuss proportions, it is absolutism; this causes earthquakes, so we should stop it (therefore we should stop those buses); this has these chemicals in it, so we should stop it (therefore we should empty swimming pools and stop drinking tap water).

I don’t like the secrecy and gagging orders in the US, it makes me suspicious. But we could do with an honest argument from anti-frackers.

“The example you give is for Titanium oxide based capacitors. Titanium being expensive and hard to work, I can see these things being very effective, but also very expensive.”

Pedantry alert: titanium metal is very expensive, yes. Titanium dioxide is not. It’s the process of turning the second into the first that is actually the expensive part.

Titanium dioxide is actually the white in white paint: it’s got to be fairly cheap therefore. And indeed it is. Around $500 a tonne last time I looked. Some 4 million tonnes a year produced as well.

Just to really get into the pendantry there was an interesting discovery in Oz. If you make roof tiles that are TiO2 rich and then run water over them then the sunlight and the TiO2 will act as a catalyst breaking the H and the O2 apart. Therefore a cheap method of generating H2 to feed into fuel cells.

Of course, you’ve got to be a bit careful about anyone going up on the roof to have a smoke…..

@ Tim

You are pedantic but correct. I should have been more clear. As I understand it, to make Ti02 capacitors you need to form and reform the oxide into metal then oxide again. This is the expensive bit.

54. Paul peter Smith

@49 UKLiberty
Precisely the point, instead of choosing a side based on predetermined (and superfluous) ideologies then figuring out how to coerce or scare everyone else most effectively. We need to know if shale gas is a godsend or a false dawn based on non-partisan thought processes.

More look over there at something else. This time we’ve been given a stream of non-related information about titanium oxide.
Tyler #48 "There’s no way any of that fluid will “seep up” into water supplies." Prove that it doesn’t seep.

49. ukliberty
With most things of this nature in Britain, it has been presented as a left wing vs right wing socio-political football with the opposition depicted as consisting entirely of ‘tree-huggers’ etc.
In France, where fracking has been banned, opposition came from the far left, the far right and the centrists in politics.

The provenance of the argument is less relevant to me than what the argument consists of, but I do appreciate that many people from across the political spectrum are swayed by horror stories from entities they have an affinity with.

@ Ceiliog

Prove that it does…fracking has been going on, using much older technology, for 40 years in the UK. With no problems. With no-one batting an eyelid until the large new shale gas finds turned public attention to it.

56.
In science, theoretical or practical, it is up to the asserter to prove his/her statement.

@ Ceiliog

“In science, theoretical or practical, it is up to the asserter to prove his/her statement.”

Given you are making an assertion, please go on and prove it.

There are over 200 oil and gas fracking wells in mainland UK. They have been operating since the late 70’s. No water contamination.

US fracking regualtions are less stringent than UK ones (single shield pipes rather than the 3 used here, waste fluids stored in the open before treatment rather than steel tanks in the UK). While there are lots of allegations of water pollution from fracking in the US, they haven’t been proven.

Tyler #48 “There’s no way any of that fluid will “seep up” into water supplies.” That it an assertion so, please prove it. Science is evidence based.

"There are over 200 oil and gas fracking wells in mainland UK. They have been operating since the late 70?s. No water contamination." On a very small scale and using a different process.

"waste fluids stored in the open before treatment" Before treatment? What treatment? Where?

@48 Tyler

I did read the post. I knew you would focus on the “weakness” within the very first paragraph! So what? Whether the pollution is underground or on the surface, it is still pollution from a witches brew of various toxins, mutagens etc. and as ceillog has implied, seepages through easily frackable rock is not something to be complacent about, no matter how much “profit” there is in the short term for your favourites, with the rest of us underwriting through taxation and our future.

Then you attempted to rebut my position by what precisely, stating that the pollution caused by using fossil fuels as an energy source for transport produces mutagens like benzene anyway. Quite the rebuttal there in an OP about people campaigning against your favourite corporations profiting from the misuse of such “fuel” sources in the first place! I hope there’s no – abnormalities – cropping up in the next few generations in all of our families. Not just yours. As for you claiming that new tech from new science would be “too expensive” look again at your favourite industry. Especially the exponentially rising cost of it.

@50 Tim

“Just to really get into the pendantry there was an interesting discovery in Oz. If you make roof tiles that are TiO2 rich and then run water over them then the sunlight and the TiO2 will act as a catalyst breaking the H and the O2 apart. Therefore a cheap method of generating H2 to feed into fuel cells.”

I remember reading about that. Interesting. Obviously once developed properly it has potential. It won’t be as simple as painting our rooftops white, if nothing else for your quip about not smoking on a roof! Obviously for the sake of efficiency, such a roof tile will need to be sealed properly. Engineering.

63. David Higgs

Fracking will continue no matter how many protest or disagree. The simple fact is many members of the government and Tory insiders, including George Osborne’s father-in-law (Lord Howell) have major interests in the fracking industry. His son-in-law also handed out a lucrative tax break benefiting several members of the government whilst simultaneously cutting funding for renewable energy . The reality is fracking will not lower prices as it is only financially viable when prices are high. So, they are not concerned with lowering prices so that pensioners can relax and put their heating on in freezing temperatures or worrying about the impact on the environment. How they can be trusted in government when they have vested interests beggars belief but that is what is happening. They get in power then laugh all the way to the bank!

@ukliberty

“As a fence-sitter, that is what turns me off the anti-frackers…”

What troubles me about your statement is that you seem to be holding anti-frackers to a standard that you don’t appear to apply to pro-frackers.

They argue that contamination is a non-issue because the chemicals used are in household products anyway (see the fracking article posted the day before this one), with no consideration of the frequency or mode of exposure.

They make claims about levels of concentration without citation (you can find numerous relevant citations in my previous postings on the fracking articles, I won’t reproduce them here) and they ignore the issue that water contamination may be taking place due to removal of contaminants from the surrounding rock, with deposition in the water by the fracking process (i.e. risks remain even if they use water and nothing else).

They argue that renewables are not an alternative because they are only viable with massive subsidies, while ignoring the vast fossil fuel subsidies (I’ve tried including a link to this unsuccessfully, so just Google “IMF fossil fuel subsidies” to find the IMF report on this subject).

Finally, if you’re a fence-sitter I think there is one additional question worth asking: what is the environmental legacy of the industry in question?

Even ignoring the CO2 issue, is this an industry that deserves a degree of trust in its attitude towards environmental stewardship? This industry has a long history of environmental “incidents”, despite ever present assurances of adequate regulation and environmental impact assessments. We know what we’ve seen in the past from this industry, I think it is entirely legitimate to give that consideration when thinking about their future activities.

What troubles me about your statement is that you seem to be holding anti-frackers to a standard that you don’t appear to apply to pro-frackers.

On the contrary – that’s why I’m still on the fence.

@ 62

“Even ignoring the CO2 issue, is this an industry that deserves a degree of trust in its attitude towards environmental stewardship? This industry has a long history of environmental “incidents”, despite ever present assurances of adequate regulation and environmental impact assessments. We know what we’ve seen in the past from this industry, I think it is entirely legitimate to give that consideration when thinking about their future activities.”

Precisely. Even before a certain incident in the Gulf of Mexico, BP’s day to day operations cost nations of the world nearly double their total profit in clearup costs of oil spills etc. if that company had to foot the bill for their activities like the rest of us, they would either have to increase the price of their products dramatically or declare bankruptcy within a week.

Perish the thought that people who profited from such fecklessness would actually have to pay to clear up the mess they make though. They would suddenly be a little less rich than they are now. Their sole motivation is power and privilege, or to be more accurate the endorphins, serotonin and dopamine cascades triggered by such wealth. Incidentally that neurotransmitter combination’s closest external analogue is freebasing heroin and cocaine!

However, it is a heinous crime for me to ever suggest that as their motivation. How dare I ever think that eh? 😉

67. Charlieman

@64. Dissident: “Even before a certain incident in the Gulf of Mexico, BP’s day to day operations cost nations of the world nearly double their total profit in clearup costs of oil spills etc.”

The proposition is that, at some point in time, the externalities of oil extraction by BP were greater than the profit earned by BP. Evidence, please?

It is likely, of course, that a company will pay mitigation costs for the damage of their industry. Payback may be incorporated into licence or land use fees, or may be supplementary damage payments. However the mitigation cost is provided by the damager, and it is a cost of doing business; in almost any business, the cost of doing stuff is significantly greater than profit.

Extractive industries, by their nature, damage the environment and need to pay for the consequences. With the possible exception of mineral use of sea water, all extractive industries are environmentally harmful, and are controlled by politicians and land owners. Politicians and land owners may be more significant agents than multinational companies; but they are spread across the world, and it is easier to point fingers at multinationals when things go wrong; point your finger at all of them.

The green war against oil/gas fails to comprehend that it is just one extractive industry. Assuming that the world does not use gas/oil, people will continue to dig huge (or small) holes in the ground which harm the environment. And political/land ownership abuse problems will continue.

Green campaigners tell us that we can generate energy without oil/gas, which I believe to be true, eventually. They do not recognise that oil has more utility than power generation. They have never looked around their houses and counted the number/mass of oil-derived plastic objects.

Here’s an angle I’ve never considered – ever hear of biogas from landfill sites and sewage farms? Both are shall we say enthusiastic emitters of methane – and would be far more profitable sources of such than shale gas would ever be. Why frack when we waste that readily available source?

http://pdf.usaid.gov/pdf_docs/PNADK799.pdf

Is it the knee jerk “yuk” factor, or is fracking the countryside with tens of thousands of derricks – with absolutely no limit on how close they can be placed next to our homes – seen as “macho” by those scrounging, lying wimps on Downing Street?

http://www.greenpeace.org.uk/newsdesk/energy/data/infographicwhat-would-it-mean-extract-10-uks-shale

How can that be considered profitable in comparison to biogas? Which incidentally would solve 2 problems at once and there is already most of the infrastructure needed for its exploitation?

@ 65

“The proposition is that, at some point in time, the externalities of oil extraction by BP were greater than the profit earned by BP. Evidence, please?”

How’s this?

http://grist.org/energy-policy/2011-10-26-direct-subsidies-to-fossil-fuels-are-tip-of-melting-iceburg/

69. Robin Levett

@Tyler #46:

“Solar power has a one-off payment”

If only this were true. Solar panels wear out

Interesting. Solar PV panels are generally guaranteed to maintain 90% of output for 10 years, and 80% for another 10-15 years.

That is; after 25 years, solar PV panels are expected still to be producing at 80% of their original spec.

By the end of the 1st year, on the other hand, a shale gas well will be down by c80% of its original output. That’s “by”, not “to”. After another 4 years, it’ll have halved output again to about 10% of the original yield, and will continue dropping.

So: for a given gas output, drilling costs will continue for the lifetime of the field. The supposedly one-off capital cost of drilling and fracking a well becomes a recurring expenditure.

70. Charlieman

@68. Dissident: “How’s this?

http://grist.org/energy-policy/2011-10-26-direct-subsidies-to-fossil-fuels-are-tip-of-melting-iceburg/

It’s an American analysis which is not applicable to countries like the U which apply carbon taxes.


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