Lessons from the Shale Revolution

On February 22, 2012 — No comments

In his State of the Union address, President Obama invoked the 30-year history of federal support for new shale gas drilling technologies to defend his present day investments in green energy. Obama stressed the value of shale gas—which will create thousands of jobs and billions in profits—as part of his “all of the above” approach to energy, and defended the critical role government investment has always played in developing new energy technologies, from nuclear to solar panels to wind turbines.

The president’s remarks unsurprisingly sparked a strong response from some conservatives, who have downplayed and even attempted to deny the important role that federal investments in hydrofracking, geologic mapping, and horizontal drilling played in the shale gas revolution.

This is an over-reaction. In acknowledging the critical role government funding played in shale gas, conservatives need not write a blank check for all government energy subsidies. Indeed, a closer look at the shale gas story challenges liberal policy preferences as much as it challenges those of conservatives, and points to much-needed reforms for today’s mash of state and federal clean energy subsidies and mandates.

Some have pointed to the fact that fracking dates back to the 19th century and hydraulic fracking to the 1940s as evidence that federal funding for today’s fracking technologies was unimportant. But dismissing the importance of federal support for new shale gas technologies in the ’70s and ‘80s because private firms had succeeded in fracking for oil in the ’40s and ’50s is like suggesting that postwar military investments in jet engines were unnecessary because the Wright Brothers invented the propeller plane in 1903.

Enhancing oil recovery from existing wells in limestone formations by injecting various combinations of water, sand, and lubricants, as was done by private firms starting in the 1940s, is a vastly different and less complicated technical challenge than recovering widely dispersed gas methane in rock formations like shale that are simultaneously porous but not highly permeable.

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