Shale Boom in the U.S. Is Bridge to Future Cleaner-Burning Fuels

Shale Boom in the U.S. Is Bridge to Future Cleaner-Burning Fuels

A shale boom in the U.S. that’s led to lower natural gas prices and higher energy efficiency will act as a bridge to cleaner burning fuels, Carol Browner, a former Environmental Protection Agency head, said today. “Right now there are a lot of reasons” to favor using natural gas, said Browner, a senior counselor at Albright Stonebridge Group, a Washington-based global strategy organization. She spoke at “The Year Ahead: 2014,” a two-day conference sponsored by Bloomberg LP in Chicago.The U.S. is forecast to pump 70.29 billion cubic feet a day of natural gas this year, up from the 2012 record of 69.18 billion as hydraulic fracturing, or fracking, has unlocked shale deposits that previously were uneconomical to produce, according to data from the Energy Information Administration, the statistical arm of the U.S. Energy Department.

Natural gas for December delivery rose 3.3 percent today to $3.674 per million British thermal units on the New York Mercantile Exchange. That’s down from a record $15.78 in 2005. Gas accounted for 30 percent of electricity generation last year, up from 19 percent in 2005, EIA data show.

Browner said the U.S. shouldn’t settle on the fuel as a staple for energy production because it can have adverse effects on the climate. She was President Barack Obama’s energy and climate czar and was in charge of the EPA during Bill Clinton’s two-term administration.

Storm Damage

The country has to adapt to the fact that storms are becoming more violent and sea levels are rising, citing the impact of Hurricane Sandy in the Northeast last year.

A glut of natural gas has prompted U.S. companies to seek to export the fuel. The federal government approved in August, three export projects, including Cheniere Energy Inc.’s Sabine Pass and the Lake Charles Exports LLC terminals.

Abundance of the fuel could “be a major source of strength” versus other countries, said Robert Hormats, a former undersecretary of state for economic growth, energy and the environment in the Obama administration. “We have an enormous competitive advantage,” he said.

Browner said advances in shale drilling technology have happened so rapidly that it will take “billions” of dollars to reconfigure infrastructure to export fuel from initial plans to import it.

The U.S. should boost reliance on nuclear power by making carbon more costly, said Mark Tercek, president and chief executive officer of the Nature Conservancy, an Arlington, Virginia-based environmental organization.

“We failed to put a price on carbon,” Tercek said. “That would help nuclear.”

Browner said that she also supports nuclear power development.

To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net