Trucost Blog / 05 Aug 2011

Are unconventional fossil fuels threatening the future of the low-carbon economy?

Shale gas offers the US energy security, but there is now a growing concern that the expanding shale gas industry is threatening investment in renewables necessary for a low-carbon economy.

Unconventional fossil fuel resources such as shale gas in the US and oil sands in Canada are rapidly being developed.

The US natural gas industry has changed substantially since 2000, with shale gas production rising “from virtually nothing in 2000 to over 10 billion cubic feet per day in 2010”, according to the study Shale Gas and US National Security by the Baker Institute in 2011.

Shale gas offers the US energy security, but there is now a growing concern that the expanding shale gas industry is threatening investment in renewables necessary for a low-carbon economy. In addition, The New York Times reported that shale gas is as carbon intensive as coal due to its production methods.

Trucost data show that eight out of the 10 most carbon-intensive North American companies operating in the Oil & Gas sector extract energy from unconventional fossil fuels such as shale gas, coal bed methane and oil sands. On average, the eight companies emit 1,710 tonnes of carbon dioxide equivalent (CO2e) per  US$ mn revenue, which is more than double the average carbon intensity of the Oil & Gas sector overall.

Chart 1: Carbon intensity of ‘unconventional’ fossil fuel production v Oil & Gas sector average

 Comparing Carbon Intensity, 'Unconventional' Fossil Fuel Production v Sector Average

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