There was something odd about George Osborne offering tax breaks for fracking when it was still banned by another part of his government. The ban has been lifted and exploration can begin again in Lancashire, in what could be the most important piece of economic good news since the discovery of North Sea oil.
But listening to the BBC reports this morning, it’s striking how the corporation already seems to be against it. Fracking has begun, it says. And the two things is listeners need to know about fracking? That it has been accused of polluting water in America and causing earth tremors. The upside, especially for Blackpool and its environs, was not mentioned.
A more balanced report would have added that fracking has already cut American gas costs by two-thirds – and that would be no small achievement in Britain where (appallingly) about 20,000 pensioners die of the cold each year, many afraid to turn on the heat because they can’t afford it. Gas emits less carbon, so US emissions are now down 5pc and the IEA predicts that the US will soon be self-sufficient.
There’s a good BBC piece in the geopolitical implications of all this. In the Persian Gulf, the peace is maintained by the US Navy, which spends some $80 billion a year patrolling the sea lanes. Will it still do so when America no longer needs Arab oil? Vladimir Putin has built his Russia around an oligarch-friendly system where the Kremlin will turn a blind eye to corruption as long as the petrodollars flood in from the Caspian Sea. If this money supply chokes up, the Kremlin may be forced to find ways of creating conditions for stable business growth, like those in Eastern Europe.
What’s more, plummeting fuel prices in America have also led to what’s being called a “homecoming” of manufacturing. Abundant cheap energy has persuaded Shell to open a new ethane plant in the once-rusting ‘steel valley’ of Pittsburgh; Dow Chemical is pulling out of the UK and the Netherlands to open a propane venture in Texas. An America that spent the last decade fretting about ‘off-shoring’ is now talking about ‘re-shoring’.
The prospects for the shale-rich north of England could be just as bright. And in explaining what fracking might mean to Britain, the BBC really ought to talk about the amazing, potentially transformative economic upsides – as well as the environmental concerns.
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