Thursday, 14 June 2012

Fareed Zakaria on shale gas: Western democracies no more dependent on rogue states (like Russia)

Fareed Zakaria has an excellent column about the huge impact of the American led shale gas revolution:

And in a short time, its success has led to the drilling of 20,000 wells in America, the creation of hundreds of thousands of jobs, and a guaranteed supply of gas for perhaps 100 years. The International Energy Agency says global gas production will rise 50% by the year 2035; two-thirds of that growth will come from unconventional sources like shale — a market the U.S. completely dominates.
We've become the world's lowest-cost producer of natural gas at a cost of $2 per thousand cubic feet; compare that with many European countries which have to pay seven times as much to Russia.
It's increasingly possible to use liquified natural gas as a substitute for oil as a transportation fuel, so the effects go beyond generating electricity. General Motors is planning to produce cars that can take natural gas or oil in their fuel tanks.
Aside from the advantages to America, shale gas has the potential to change the geopolitics of energy.
So far, gas has been supplied by a handful of regimes — Russia, Iran, Venezuela — many of them nasty and illegitimate, thriving on global instability, which actually helps their bottom line since instability equals higher oil and gas prices.
In the next 20 years, much of this energy could come from stable, democratic countries like the United States, Canada, Australia, Poland, France and Israel. That would be good for the free world, bad for the rogues and good for global stability. China has huge shale reserves and, even though it is not democratic, it is a country that seeks stability, not instability.
In Europe, where the greenies and Gazprom have formed an unholy alliance against shale gas, there is at least some good news to report:
Energy from gas power stations has been rebranded as a green, low-carbon source of power by a €80bn European Union programme, in a triumph of the deep-pocketed fossil fuel industry lobby over renewable forms of power.
In a secret document seen by the Guardian, a large slice of billions of euros of funds that are supposed to be devoted to research and development into renewables such as solar and wave power are likely to be diverted instead to subsidising the development of the well-established fossil fuel.

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