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The Influence of Shale Gas on U.S. Energy and Environmental Policy

Author

Listed:
  • Henry D. Jacoby
  • Francis M. O'Sullivan
  • Sergey Paltsev

Abstract

The emergence of U.S. shale gas resources to economic viability affects the nation's energy outlook and the expected role of natural gas in climate policy. Even in the face of the current shale gas boom, however, questions are raised about both the economics of this industry and the wisdom of basing future environmental policy on projections of large shale gas supplies. Analysis of the business model appropriate to the gas shales suggests that, though the shale future is uncertain, these concerns are overstated. The policy impact of the shale gas is analyzed using two scenarios of greenhouse gas control-one mandating renewable generation and coal retirement, the other using price to achieve a 50% emissions reduction. The shale gas is shown both to benefit the national economy and to ease the task of emissions control. However, in treating the shale as a "bridge" to a low carbon future there are risks to the development of technologies, like capture and storage, needed to complete the task.

Suggested Citation

  • Henry D. Jacoby & Francis M. O'Sullivan & Sergey Paltsev, 2011. "The Influence of Shale Gas on U.S. Energy and Environmental Policy," RSCAS Working Papers 2011/52, European University Institute.
    • Handle: RePEc:rsc:rsceui:2011/52
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    References listed on IDEAS

    as
    1. Paltsev, Sergey & Jacoby, Henry D. & Reilly, John M. & Ejaz, Qudsia J. & Morris, Jennifer & O'Sullivan, Francis & Rausch, Sebastian & Winchester, Niven & Kragha, Oghenerume, 2011. "The future of U.S. natural gas production, use, and trade," Energy Policy, Elsevier, vol. 39(9), pages 5309-5321, September.
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    Cited by:

    1. Healey, Stephen & Jaccard, Mark, 2016. "Abundant low-cost natural gas and deep GHG emissions reductions for the United States," Energy Policy, Elsevier, vol. 98(C), pages 241-253.
    2. Julien Xavier Daubanes & Fanny Henriet & Katheline Schubert, 2021. "Unilateral CO2 Reduction Policy with More Than One Carbon Energy Source," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 8(3), pages 543-575.
    3. Jakub Boratyński, 2015. "Ekonomiczne skutki eksploatacji gazu łupkowego," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 1, pages 55-82.
    4. Balthrop, Andrew T. & Hawley, Zackary, 2017. "I can hear my neighbors' fracking: The effect of natural gas production on housing values in Tarrant County, TX," Energy Economics, Elsevier, vol. 61(C), pages 351-362.
    5. Julien Xavier Daubanes & Fanny Henriet & Katheline Schubert, 2017. "More Gas, Less Coal, and Less CO2? Unilateral CO2 Reduction Policy with More than One Carbon Energy Source," IFRO Working Paper 2017/09, University of Copenhagen, Department of Food and Resource Economics.
    6. Taheripour, Farzad & Tyner, Wallace E., 2014. "Shale oil and gas booms: Consequences for agricultural and biofuel industries," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170238, Agricultural and Applied Economics Association.
    7. Christopher Hannum, 2023. "Effect of Natural Gas Prices on Renewable Portfolio Standard Impacts," International Journal of Energy Economics and Policy, Econjournals, vol. 13(2), pages 391-403, March.
    8. Yu Zhang & John A. Rupp & John D. Graham, 2021. "Contrasting Public and Scientific Assessments of Fracking," Sustainability, MDPI, vol. 13(12), pages 1-21, June.
    9. Zeeshan, Muhammad & han, Jiabin & Rehman, Alam & Ullah, Irfan & Hussain, Arif & Alam Afridi, Fakhr E., 2022. "Exploring symmetric and asymmetric nexus between corruption, political instability, natural resources and economic growth in the context of Pakistan," Resources Policy, Elsevier, vol. 78(C).
    10. Wang, Qiang & Chen, Xi & Jha, Awadhesh N. & Rogers, Howard, 2014. "Natural gas from shale formation – The evolution, evidences and challenges of shale gas revolution in United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 1-28.

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