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Has US Shale Gas Reduced CO2 Emissions?

Since 2007, the production of shale gas in large volumes has substantially reduced the wholesale price of natural gas in the US. This report examines the emissions savings in the US power sector, influenced by shale gas, and the concurrent trends in coal exports that may increase emissions in Europe and Asia.

Key findings:

  • By 2012, US CO2 emissions from domestic energy have declined by 8.6% since a peak in 2005, the equivalent of 1.4% per year.
  • At the same time, there has been a substantial increase in coal exports from the US over this time period (2008-2011) and globally, coal consumption has continued to rise.
  • Without a meaningful cap on global carbon emissions, the exploitation of shale gas reserves is likely to increase total emissions.
  • The calculations presented in this report suggest that more than half of the emissions avoided in the US power sector may have been exported as coal.
  • In total, this export is equivalent to 340 MtCO2 emissions elsewhere in the world, i.e. 52% of the 650 MtCO2 of potential emissions avoided within the US. The estimated additional 75 million short tons 1 of coal exported from the US in 2011 will release 150 MtCO2 to the atmosphere upon combustion.
  • If added to the US CO2 output from fossil fuel combustion, the reduction from peak emissions in 2005 would be 360 MtCO 2 , i.e. a 6.0% change over this whole period or less than 1% per annum. This is far short of the rapid decarbonisation required to avoid dangerous climate change associated with a 2°C temperature rise.

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