Well everyone, it ends up that I’ll be using this blog again, but this time talking about environmental economics topics.

So, first up is the topic of shale oil and gas. Recently it has been a major issue in the U.S and has been considered to be a huge boom industry:

http://belfercenter.ksg.harvard.edu/files/Oil-%20The%20Next%20Revolution.pdf

However, at the same time, the negative effects of it are starting to show as well. As of recently the fallout of the shale gas is visible up in the reaches of space. This comes from the flaring of the natural gas that comes out. Essentially, this gas could be used as a natural gas for power, but the low value of it makes it uneconomical to capture this gas so it is burned instead.

http://www.cnbc.com/id/100412356/Shale_Gas_Boom_Now_Visible_From_Space

It seems that celebrities are in the battle as well with Yoko Ono and Sean Lennon (John’s son) not too pleased the the fracking that is happening in New York and the negative effects that it brings.

http://www.bloomberg.com/news/2013-01-23/on-new-york-shale-gas-yoko-ono-and-sean-lennon-say-let-it-be.html

Finally to close out, here’s a better example of those externalities with an organic dairy farmer who happens to have her farm on top of the Marcellus shale, a large deposit. She has seen increased levels of the gas and metals on her farm.

http://www.theecologist.org/News/news_analysis/1784330/dairy_farms_suffer_in_us_shale_gas_fracking_boom.html

From all of these, we can see the multiple levels of players in the topic of shale oil and gas, at the base level we see the farmer who is nearby on the these deposits and see first hand the externalities of the extraction. Then, we see those who are protesting against fracking and the building of the infrastructure for the industry due to the aforementioned externalities on the local community. On the next layer, we can actually see what happens during the flaring that occurs during the extraction. Then, at the top, we see the potential for this industry to create unleash untapped potential for the economy. It is clear that there will be huge levels of conflict and it will be interesting to track how it plays out.

Next time, I’m going to focus a little bit more on that whole idea of “unleashing untapped potential for the economy,” for better or worse.