UK Energy: Shale Gas

In this policy statement we consider the inclusion of shale gas in the UK’s future energy mix.

To date, the adoption of shale gas as an energy source across Europe has been slow, due to different perspectives on a number of environmental factors and uncertainty regarding the role that it should play in energy policy.

Increasing demand for energy worldwide means that there is a constant search for new energy sources, in terms of both geographical locations and exploitation methods. One such source is shale gas, which has transformed the energy sector in the USA.

Although there is considerable uncertainty regarding the global shale gas resource and estimates suggest that the bulk is located in the USA and China, potential sources exist in Europe which could provide the UK with energy opportunities both at home and abroad.

Key recommendations

1. Accelerate the enhancement of the environmental regulatory framework to ensure safe exploitation of shale gas in the UK as soon as possible.
   Recent studies have shown that the UK’s regulatory framework is fundamentally fit-for-purpose for shale gas exploration, but the government should urgently extend the framework for production to build public confidence in the management of the environmental risks associated with the emergence of a shale gas industry.
2. Develop UK industrial strategy to include a regional strategy for exploitation of shale gas.
   The government is committed to rebalancing the UK economy and has strong cross-party support. The Department for Business, Innovation and Skills is developing a UK industrial strategy and the opportunity should be taken to include shale gas as a regional dimension. This would support the creation of highly skilled jobs with future export potential, while contributing to the nation’s energy security.
3. Prioritise the development of Carbon Capture and Storage (CCS) with gas-fired power plant.
   The UK is committed to a decarbonised energy system by 2050 to meet legally binding mitigation targets. With gas-fired plants projected to make up a substantial part of the generation mix in the coming decades, the government must urgently prioritise the demonstration and deployment of commercial-scale CCS technology in gas power stations and ensure low-carbon gas generation is included in policy development, especially the Electricity Market Reform.