Energy round-up: what’s the big picture?
Photo credit: imahornfan
May 30, 2014 // By: Griffin Carpenter
Three things you shouldn't miss this week
- Chart: Putting Weald shale oil in perspective – total recoverable reserves amount to less than half the UK’s annual demand:
- Article: U.S. officials cut estimate of recoverable Monterey Shale oil by 96% - The Monterey Shale formation contains about two-thirds of the nation's shale oil reserves. It had been seen as an enormous bonanza
- Chart: $44 trillion cost of decarbonising the energy system is offset by over $115 trillion in fuel savings:
Hopes of a shale bonanza to replace dwindling conventional resources took a battering this week. In the UK the British Geological Survey released its estimate of the shale resource in the Weald Basin (Kent, Hampshire, Sussex), concluding that it has no meaningful gas, and between 2 and 8.5 billion barrels of oil in place. It may sound a lot, but of that only 5-10% of the oil resource is likely to be recoverable, which would amount to less than half of UK annual demand. Undeterred, the government continued with efforts to boost fracking by proposing changes to trespass laws and increasing compensation for communities that allow the drillers in.
If the UK Weald assessment was disappointing for fracking advocates, imagine the embarrassment of the US Energy Information Administration (EIA), forced this week to slash its estimate of the recoverable oil in the Monterey shale play in California by a whopping 96%, or 13 billion barrels. It turns out the previous estimate was based on the assumption that California’s geology would be as simple as that of North Dakota, whereas it is in fact far more complicated. At the same time, there were also reports that many shale companies across the US are struggling financially because of the constant drilling required to counter vertiginous well decline rates. Yet again, shale is the victim of its own hype.
In an otherwise bleak report about the world’s chronic failure to invest enough in clean energy, some encouraging news came this week from the International Energy Agency. It once again demonstrated that the economic case for transition is incontestable. We would need to invest an extra $44 trillion to secure clean energy future by 2050, they say, but that would be far outweighed by fuel savings of $115 trillion. If only our politicians could stop obsessing about short term shale and raise their gaze to the big picture.
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