Shale Gas Poses Financial Threat to Clean Tech

By Bill Paul

 

What a coincidence that as ExxonMobil’s interest in shale gas grows, the company declares, in its latest long-term energy forecast, that it has seen the future and it is natural gas. Or as the Wall Street Journal put it, “Exxon Declares Gas King”

Every clean tech advocate and investor should beware this statement – and others like it that fossil fuel’ers like Daniel Yergin have recently made – because it underscores clean tech’s greatest vulnerability, namely: the more embedded investment fossil-fuel firms have to protect, the more ferociously they will fight to stop the development of “game-changing” clean technologies.

Cynic that I am, I would argue that clean tech has been “allowed” to develop by the fossil folks and their Wall Street allies who truly control the global energy industry partly because billions of embedded investment in coal-fired power plants and other aging fossil-fuel infrastructure have been coming off the books in recent years. Couple that with the expected surge in energy demand through at least 2050, and it has become advantageous for Wall Street to put money to work building a global clean-tech industry.

With shale gas ascending, however, clean tech is faced with the prospect of billions of its dollars being diverted into new fossil-fuel infrastructure that won’t come off the books for decades. Bonds that are sold to develop the shale gas industry are bonds that must then be protected from game-changing clean technologies.

Could this push climate change past the “tipping point”? Absolutely. But that’s not an argument that will sell on Wall Street.

Here’s one which, if enough people start talking about it, may help keep clean tech in the big-money game. A new study  from the NationalCenter for Atmospheric Research (NCAR) concludes that switching from coal-fired to gas-fired power generation would do little to significantly slow down climate change and might actually accelerate it.

 

 

Bill Paul – billpaul9348@gmail.com – is a consultant and the owner of Earth Preservers – http://earthpreservers.com — an environmental education newsletter and edutainment website for kids of all ages. A former Wall Street Journal energy reporter and CNBC special energy correspondent, in 2010 Paul was named a “thought leader” in energy by the US public television program “Consuelo Mack WealthTrack” — http://wealthtrack.com.

3 replies
  1. Alex White
    Alex White says:

    I have been following this guy in Austin, TX who has a technology to burn natural gas with oxygen and reduce CO2 emissions by 80%. Coal and existing NG power plants can be retrofitted. His breakthrough is the ability to produce oxygen for a very low cost. He also can supply nitrogen to the same power plants to be used for cooling. They’d no longer need to use our rivers, lakes and streams.

    I work in the energy field. With the advent of shale gas prices are more predictable and we are beginning to see 20 year contracts at $4-$6 Mcf. Oxy-fuel combustion is an existing technology. The electricity produced will be LESS than coal-generated electricity.

    Solar has a place in our energy mix, but a very small place, perhaps up to 5%. Plus, it’s still very expensive.

    I think our resources would be better spent cleaning up our existing power plants than wasting money on solar. If we can reduce CO2 by 80% from the power sector and do it affordably, it’s a clear choice.

    You can see more at: http://www.solutioneur.com

  2. Methane
    Methane says:

    What about the incredibly high heat trapping hazards of methane? 72 times greater than CO2. What about December's reports of methane plumes outgassing from the Arctic in alarming volumes? What about methane leaks from natural gas production and melting permafrost accelerating climate disruption? What about litigation from methane leaks contaminating drinking water? What about methane leaks contaminating water in areas of water scarcity? What about the prospects of climate policies triggering stricter regulation of gas production and handcuffing natural gas investors with unexpectedly higher risks? What about this last year's record $52 billion in extreme weather event damages and the high risks and threats posed for drilling operations in hurricane and other extreme weather prone areas? Put those costs in the numerator of your $/Mcf figures. Hitching your kayak to natural gas investments in the face of year-after-year of broken climate records and the rising risks posed by fugitive methane emissions is a high risk wager. Cleantech is the wiser, safer, lower risk choice. Investors would be wise to look downstream and consider which fork takes them through Class VI rapids and which one takes them through calmer waters.

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