It’s far “too soon” for the UK to get excited about shale gas bringing down energy prices, a report by MPs said today.
Their report investigated new shale gas estimates in the UK and globally, as well as speculation that a “shale gas revolution” will bring an era of abundant, cheap gas.
The members of parliament’s energy watchdog found shale gas production in the UK could enhance our energy security and boost tax revenues.
Tim Yeo MP, Chairman of the Energy and Climate Change Committee said: “It is still too soon to call whether shale gas will provide the silver bullet needed to solve our energy problems. Although the US shale gas has seen a dramatic fall in domestic gas prices, a similar ‘revolution’ here is not certain.”
Given the country’s reserves are unconfirmed, the report suggests it would be “wrong” for the Government to base policy decisions on the assumption that gas prices will fall in the future.
However if DECC wants a new industry to grow it needs to crack on, he added: “The Government has dithered on this issue and should now encourage companies to get on and drill, to establish whether significant recoverable resources exist.”
The Tory MP said that if gas eventually does play a big role into the 2020s, technology to capture carbon from fossil fuels needs to be backed now: “The current slow pace of CCS development is incredibly frustrating. We intend to keep a close eye on DECC’s progress in this area”.
While WWF expressed “dismay” that the report appeared not to acknowledge the “fundamental incoherence” between exploiting shale gas and tackling climate change.
But Ken Cronin, chief executive of the industry group the UK Onshore Operators Group (UKOOG) welcomed the report’s suggestion it should extend the olive branch – and crucially benefits – to the local community.