The one thing Osborne loves to tell us, constantly, is that the future of energy production lies in fracking and that he will do everything in his power to maximise shale drilling in Britain, even to the extent of allowing drilling to be carried out on private land without permission.
However this oasis of future riches has received rather a knock from the latest information in the US. It has now been reported that the top 15 players in US shale drilling have written off no less than $35bn since the boom started, and that investors are beginning to pull out. It has also become clear from the big shale basins in the US that production rapidly peaks, but then equally rapidly falls away. Continue reading
George Osborne, ever anxious to shoot Labour’s fox, has attempted to counter Ed Miliband’s hugely popular call for a lengthy energy price freeze. He has proclaimed that the market can do better – by covering much of the country with shale gas drilling rigs. That will dramatically lower gas prices, as it has in the US. Except it won’t.
Osborne, in his Autumn Statement, ratified 30 new gas power sites and gave the green light to major shale gas exploration. The aim is to ensure that gas-fired power provides half of generation capacity by 2030. Some 26 gigawatts of new power capacity will be needed to replace nuclear and coal-fired plants closing down before 2020. But further, if the fourth carbon budget which sets out carbon emission targets is revised up, gas-fired power capacity could rise to 37GW. 