Regulating shale gas – Learning from the US experience

20 March 2013

Shale gas may be capable of making the US self-sufficient in terms of energy production. But concerns over its ‘greenness’ and risks related to its extraction are holding back its exploitation in the EU, heard participants in this Policy Dialogue.

David Neslin, the representative of Colorado on the U.S. Interstate Oil and Gas Compact Commission, said that oil and gas were primarily regulated at state level in the USA.

Neslin said the US had numerous unconventional gas plays, including shale gas, tight gas and coal-bed methane fields, which due to the technological advances of the last decade – such as multi-stage hydraulic fracturing – had now become economically exploitable, stimulating a lot of development. He added that there were also reserves of unconventional gas in other parts of the world.

Colorado’s results demonstrate that it is possible to develop energy production while at the same time doing a better job of protecting the environment, he argued.

Energy and climate expert Mark Johnston said both the USA and the EU had two-tier systems of government: between the Federal and the state levels, and between the EU and national levels respectively.

In the US, most energy rule-making took place at state level, while in the EU, most energy rule-making took place at national level – except for environmental legislation, which tended to come from Brussels, said Johnston, a senior adviser to the European Policy Centre.

Europe’s tendency to start at the top with environmental legislation perhaps gave its rules more homogeneity than those of the USA, which were less top-down, Johnston suggested.