Wednesday, June 22, 2011

Desirable ends for hydraulic fracturing

What follows is a free-write for exercise 1.2 in the workbook associated with this class. At this point, I'm suppose to have chosen a tentative "problem" for which I will do a project that involves defining and working toward a solution. The nascent explosion of horizontal drilling and hydraulic fracturing in the Marcellus Shale for methane is a pretty big problem around here, so I'm thinking that will be my project topic. What follows is a free-write.... it was written as a stream-of-consciousness and has not been edited for content or grammar.

The Problem – Hydraulic fracturing of Marcellus shale for methane

Sustainable Scale

sustainable scale of gas well drilling!? Ha, there couldn’t be. or could there? in theory there’s an amount of CO2 we could burn that the ecosystem could absorb. but the drilling could never be sustainable, the gas is finite and consumed. on an empty planet, the problem wouldn’t be one of sustainability, because there might be enough gas for everyone to burn some without making a dent in total reserves, but problems of pollution and environmental injustice would remain.

If the rate of throughput increases?! HA! The rate of throughput is exploding, with disasterous consequences. The benefits – a few jobs, slightly cheaper natural gas, and we will be able to keep the lights on for a few years longer, if we don’t melt the planet first. The consequences – we’re befowling our streams, tearing apart our mountains, toxifying the air. And it’s falling on people that have lived with the disasterous consequences of coal mining for generations. My heart sinks to think that now they’ll be burdened with this. I can and will leave; it’s not really my battle. I’ll fight it while I’m here, but I’ve never felt like it was my water being polluted. But I see how beaten down these people are by the mining, and I see how divided they are about the industry. It breaks my heart to see it reving up in a new arena.

Just Dirstribution

Who benefits? The mineral owners (if they don’t plan to stay living near the wells) and the energy companies. And the population as a whole in a very dilute way by the pennies they save on their gas bills. Though I’m not sure that’s true…… if we were to not drill into unconventional gas reserves, increased prices would force conservation, which might lead to a happier way of life, and could slow encroaching disasters associated with climate change.

Who created the costs? The beneficiaries, of course. Duh.

Who bears the burden? The people of Appalachia. The poor, health-impacted, community-divided people of Appalachia. For those few who can lease gas rights and make enough money to retire and perhaps move away, who can blame them? And even more so when their neighbors have already leased gas rights. In that way, it spreads like a contagious disease.

who created the values that are affected? nature, first and formost – the streams, the hills, the forests, all raped and pillaged. but also people who have built houses, developed farms, and developed relationships with their local landbase.

who determines what is just and unjust? in what court? in the court of public opinion, I suppose each of us individually, with (sometimes coercive) guidance from the media. in the court with material consequences, the courts, armed with police and appointed by corrupt political processes.

Efficient Allocation

the external costs are many – I hope someone will do an analysis for Marcellus wells like the ‘true cost of coal’ analysis that Epstein recently published. if they had to pay for the potential risks and eventual costs, I suspect they wouldn’t be able to drill. externalized costs include pollution of waterways that is guaranteed: sedimentation runoff and some amount of organics, and the product of the probality of a blowout or other disaster times the costs of such a disaster—from the emergency crews that come to put the fires out, to the downstream ecological effects. there’s also the air pollution, the people who have to move off their farm lands or from their homes because they’re getting sick from the air pollution. there’s the lost aquifers, which are becoming all the more valuable as (clean) water becomes scarcer.

perhaps prices could be used to internalize some of these costs, and I think they should be as long as drilling is happening. but ultimately, our knowledge is insufficient to estimate the costs associated with these damages. the technology is five years old – how could we possibly know how it’s going to impact future generations?


  1. It does seem rather hopeless huh? I was thinking for the project, we could do an optimal timetable for gas extraction that minimizes associated costs. . . may be biting off more than we can handle with that one though.

    This was my response when I did this exercise:
    In regards to sustainable scale, if the planet was relatively empty with a small economy and population relative to the ecosystem, the problem of deforestation and its consequent impacts on the environment and community would not exist. If deforestation continues and its rate increases, the associated problems of species extinction, diminishing water quality, and increases in floods and droughts will continue to grow as problems. The benefits to the individual farmer in this case, compared to the costs to the land and people, are inconsequential as cattle farmers only realize $20 per hectare of revenue while ecosystem services from the rainforest are estimated at $200 per hectare.
    For just distribution, those who benefit from the deforestation and created the associated costs are cattle ranchers and timber companies. More indirectly, consumers (potentially foreign) benefit from a price for beef and timber that is artificially low and does not accurately reflect the costs of their production. These costs can be observed in the increased burden to local communities as their access to food and water from the rainforest is diminished and they go from classified as an indigenous population to a poverty stricken community. The environment and native species also see decreases in habitat and associated ecosystem services. In this case, the value system that values open land more than rainforest result predominately from the individuals who stand to marginally benefit, although society in a broader sense also creates the values that allow this to happen simply by not doing anything to prevent deforestation which implies consent and that it is a “just” distribution when in fact, it is not. Oftentimes, those that determine what is just and unjust is not the local community that should by “squatter” rights actually own the land, but rather those with the most power and influence in the local and regional economy and political government.
    Efficient allocation, to be truly efficient, needs to consider external and internal costs and benefits of a current resource allocation. External costs are not captured by the market price and in this case include polluted waters, increased land erosion and disturbance, decreases in local community and environmental resilience, decreased biodiversity and potentially increases in species extinction. Realistically, it is unlikely that prices could be adjusted to capture these externalities. The main reason for this is because beef and timber prices are subject to world prices, so unless a worldwide price system was enacted that included all external costs, any local change in price is not going to occur. The additional problem is also the problem of monetarily valuing these external costs. This means that externalities often need to be controlled outside of the market. In my opinion, one way to accomplish this is by considering that external costs are common property costs. To address these costs, a community institution that is provided the right to shut down any activity that has costs greater than benefits would be a good first step if combined with a right to the community to replace that expensive activity with one that more directly provides benefits to both the local land and people.

  2. I like your response, especially the ending. I hope that democratic institutions can protect value in the commons. I'd like to find examples of success stories like that.

    Another possible angle for our project is the injustice of distribution of costs and benefits associated with hydrofracking. That could fit nicely with your optimal timescale idea.... I'd hypothesize that the slower the gas is extracted, the less unjust the distribution. Hmm... I wonder why they were so aggressive with the Morgantown Industrial Park wells!