Fracking to Europe’s Rescue
Fracking has lowered energy prices and generated huge benefits to the US economy (e.g. here, here.) Western Europe in contrast has mostly banned fracking or put in place large regulatory barriers:
Bloomberg: Germany, France, the Netherlands, Scotland and Bulgaria all effectively ban fracking. The only major activity is in Ukraine, which is weaning itself off of Russian gas, and in the U.K., where the government is promoting the technology to help replace plunging domestic output from the North Sea. In October, Cuadrilla Resources won permission to frack as many as four wells in the U.K., ending a two-and-a-half year battle with local authorities. In 2011, tremors caused by an exploratory Cuadrilla rig in northwestern England led to a one-year moratorium on fracking in the country. In 2013, hundreds of protesters camped in a tiny village south of London until the company abandoned its well there. People in Zurawlow, a town in eastern Poland, successfully blockaded a fracking site in 2012 and Greenpeace activists have occupied a shale gas rig in Denmark.
The differences may be due to US land policy which recognizes the landowner rather than the state as the owner of mineral rights (the resources under the land)–thus, despite huge campaigns against fracking in the US, the landowners were a natural balancing constituent.
The US fracking revolution has made the US energy independent while Europe uncomfortably relies on large imports from Russia. Yet, even though Western Europe has mostly banned fracking they have begun to import lots of US liquid natural gas. The first LNG exports in the lower United States date only to 2016 but since that time exports have increased dramatically to China and Europe and the US will be the world’s largest exporter of LNG by the end of 2022.
European Commission: The European Union imports more and more liquefied natural gas (LNG) from the United States to diversify and render its energy supply more secure. LNG imports from the U.S. have increased substantially since the first shipment in April 2016. Data show that at the end of 2019 LNG exports to the EU recorded the highest volume ever. In November 2019 imports reached 3 billion cubic meters and their value was estimated at €0.5 billion. In December 2019 LNG imports from the US reached a new monthly record: 3.2 billion cubic meters, with an estimated value of €0.5 billion.
European imports have only increased since that time as Europe has shut down nuclear reactors and the price of European energy has soared. A Russian invasion of Ukraine could increase US demand even more.
All hail the fracking revolution.