At last Wednesdays Environment and Regeneration Overview and Scrutiny Sub-Committee members received an update about the Energy Sector. Of particular interest for many residents is that which related to fracking.
Shale Gas update on licensing and planning in the East Riding.
There has been no real change in shale gas (fracking) policy or development since the 2016 Overview and Scrutiny Committee Energy report was produced. The Council has not received any planning applications for shale gas extraction or exploration and whilst licences have been granted by the Oil and Gas Authority on the Yorkshire Wolds for shale gas exploration no on site work has commenced.
At the national picture, Cuadrilla commenced work at their Preston New Road site in Lancashire in July for the first horizontal frack site in the UK for shale gas. The development was approved by the Planning Inspectorate following a public inquiry. It is expected that drilling will commence later this year once the site has been prepared. A second site in Lancashire, also operated by Cuadrilla and also subject to a public inquiry, at Roseacre Wood was held in abeyance by the Inspectorate following the planning inquiry due to concerns over traffic issues. It is expected that a re-opened inquiry into this site will commence in Spring 2018. A legal challenge against the Government’s decision to re-open this inquiry failed in April.
Earlier this year a legal challenge by Friends of the Earth and Frack Free Ryedale, who argued that North Yorkshire County Council had failed to properly consider the environmental impact of burning gas when it approved fracking at the Kirby Misperton fracking site in 2015 was dismissed. It is likely that work by Third Energy will now commence work and start fracking in early 2018.
The Government support for shale gas continues and was explicitly set out in the recent general election party manifesto that said the UK could benefit from shale energy in a the way the United States had, with lower prices, less reliance on foreign imports and lower carbon emissions. It explicitly stated that :-
We will therefore develop the shale industry in Britain. We will only be able to do so if we maintain public confidence in the process, if we uphold our rigorous environmental protections, and if we ensure that the proceeds of the wealth generated by shale energy are shared with the communities affected.
It remains to be seen whether a shale gas industry will develop in the UK. Whilst there is clear political support for the development of shale there is at present very limited private sector investment into exploration and development. This may be due to the low price of oil and gas and the fact that since the USA has effectively become energy self-sufficient there is a glut of oil on the open market making any significant price rises in the near future unlikely. It will be interesting to see what the results will be from the first fracking wells in Lancashire and North Yorkshire as well as any exploration results that come forward in 2017/18 from the licensed exploration sites. This will be an important issue to be addressed in the 2018 Overview and Scrutiny Energy update report.
The report has highlighted the ongoing shift in both global and national policy from the use of carbon intensive energy sources such as coal and oil to more sustainable and renewable sources of energy such as wind and solar. The energy sector is becoming more diverse with a move away from a small number of large companies, to a wide range or smaller providers and innovators. New technologies and evolving business models are rapidly transforming the energy sector and this is evident in the East Riding. The large number of on shore wind-farms, the growth in Anaerobic Digestion to supply energy to farms and the grid; the early growth of energy storage systems and the Siemens offshore wind farm manufacturing facility are evidence of a diversified energy sector. Whether shale gas becomes a key element of this energy mix remains to be seen. The East Riding specifically and the Humber Region generally have and will continue to be an important area for energy innovation and supply of the country’s energy requirements.