The New York Times ran a compelling story yesterday on shale gas, Insiders Sound an Alarm on Shale.
The article referred to ponzi schemes and Enron and did what it was pretty much designed to do: conjure images of fraund in our 21st Century world.
Unfortunately, the Times missed the entire point. The Times asserted that proponents of shale are overstating reserves, exagerating the economics and ignoring the potential boom and bust nature of energy exploration and production. All of these things are very conceivable if not true. I was particularly surprised to read about the booms and busts; evidently the reporter had not performed even a cursory historical examination of the energy industry (or most industries for that matter).
But what are the alternatives? Renewables presently generate 3% of our electricity and have no capacity at this time to provide us with baseload generation however nice solar or wind may be. Increased coal fired generation is hardly a desirable alternative. And we have been reminded of nuclear power's risks both in the recent tragedy at Fukushima and the current flooding at the Fort Calhoun Reactor in Nebraska.
Whither the Times have us do? A quarter of the nation's natural gas is currently produced by fracking shale, there is a reason for this. We like to consume natural gas. We like electicity, we like the internet, and clean clothes and air conditioning and television. If shale drilling proves to uneconomic at economic at $4 and MMBtu then the price will rise until it is economic, perhaps the $14 it reached in 2008.