While most news coverage of shale gas in North Carolina and in other areas of the United States has focused on environmental concerns surrounding the process by which that gas is recovered, a short editorial in the latest Bloomberg Businessweek focuses on an important benefit associated with shale gas. Of course, the editorial focuses on China, rather than the U.S.
Although other factors have contributed to the blackening of China’s skies—including millions of cars and motorbikes clogging roads—coal remains the deadliest. In the past decade, China’s coal consumption has more than doubled. It now burns almost as much coal as the rest of the world combined. In the first three months of the year, levels of PM-10 (particulates with a diameter of 10 micrometers or less) in Beijing were almost 30 percent greater than during the same period a year earlier.
By contrast, in the U.S. CO2 emissions hit an 18-year low in 2012. The reason? An explosion in shale gas production raised the share of electricity produced by natural gas from 20 percent to 30 percent, while bringing down the proportion produced by coal from 50 percent to 37 percent.
China’s recoverable shale gas reserves are estimated to be 25 trillion cubic meters, 50 percent larger than those of the U.S. The government has already announced subsidies to local shale gas producers; it should also help finance new pipelines and gas-fired power plants. Officials must lower barriers to entry and increase incentives to encourage the most innovative drilling companies—the majority of which are American—to work in China.
Good for China, but not for the United States?
