The shale gas and oil revolution has created a 20-year opportunity for technology and sustainable economic development, but to realize its full potential, the people who think about energy will have to adopt a new mindset, Deloitte's Joseph Stanislaw said in a new whitepaper, in which he argues that shale resources should be a bridge to a lower-carbon future.
In "America's newfound power: What the U.S. should do to capitalize on the shale and renewable energy revolutions," Stanislaw argues that the U.S. shale "endowment" is a means, not an end. "Our ability to harness technology to produce potentially infinite amounts of clean energy -- rather than relying on finite natural resources in the ground -- is the ultimate game-changer, said Stanislaw, who is founder of the advisory firm The JAStanislaw Group LLC and one of three co-founders of Cambridge Energy Research Associates (CERA).
He said the United States is in a position to leverage its finite resources in the ground to reach a day "where energy resources could be effectively limitless." However, focusing on "energy independence" alone could set the United States on the wrong course, he said.
"True energy security can only be attained if the shale endowment is seen as a means, not an end -- and only if it is reinvested rather than consumed. The economic and geopolitical prospects of the United States now rest on how well the country uses its unexpected windfall to build a cleaner, cheaper, and more reliable energy infrastructure -- both supply and demand sides -- for the coming generations," the paper argues.
Shale resources should be the bridge to a lower-carbon future, Stanislaw said. "We have a unique opportunity to diversify our energy portfolio, as well as the time and resources to push hard on all energy frontiers. Optimizing the revolution in unconventionals and in clean-energy technologies will require vigorous government involvement to set the rules of the game and spur research and development, by both the public and the private sectors."
The U.S. government will need to pursue action to husband the shale revolution; build a policy bridge to a low-carbon economy; strike a "balanced approach" to pricing carbon; and "put the U.S. back in the game on climate change."
By becoming a global leader on climate and energy issues, the U.S. can help change the game from a battle over resources to a pursuit of technology that can support sustainable development, Stanislaw said.
"Perhaps the most important fact to remember about the shale revolution is this: An entire century passed between the discovery of shale and its full-scale exploitation," Stanislaw rote. "Wildcatters in Santa Barbara [CA] first found 'brown shale' in the Orcutt oil fields in 1901, but they and others ignored it to get to the liquid oil underneath. The Bakken formation, which is at the heart of the shale revolution, was discovered in 1951, but more than a half century passed before it was exploited."