The US oil and gas boom has been one of the biggest and most consequential energy stories of the last decade. And one of the best books for understanding how that boom is affecting America is Michael Levi’s The Power Surge, published back in 2013.
As Levi explained when I interviewed him last year, his book is actually about two different energy revolutions going on in the United States — each with its own set of supporters. On the one hand, US oil and gas production has been surging since 2005, thanks to hydraulic fracturing and other drilling techniques. But at the same time, alternative energy sources like wind power and electric vehicles had been making surprising advances. Different camps often claim that one or the other technology is the best solution to America’s energy and climate woes. Levi’s book, meanwhile, focused on how these trends could potentially work together.
Yet it was unclear how this battle would ultimately shake out. Environmentalists and energy companies were at an impasse over how best to deal with the water and air pollution caused by fracking. It was also uncertain whether the glut of cheap shale gas would help tackle climate change (by displacing coal) or just make things worse (by undercutting clean energy).
Since the book came out, more than a year has passed — and quite a lot has changed. So, recently, Levi decided to write a new epilogue for the paperback edition of his book, looking at some of the more unexpected energy developments over the past year, like the emergence of Tesla or the disruptive rise of rooftop solar power. (He listed a few of them over at his blog.)
I caught up with Levi — who is the David M. Rubenstein Senior Fellow for Energy and the Environment at the Council on Foreign Relations — to revisit what we’ve learned about how the oil and gas boom is changing America. A transcript is below:
Brad Plumer: Let’s start with the big picture. It’s been 8 or 9 years since the US oil and gas boom began — since companies began using fracking to unlock new supplies of oil and gas from shale rock in places like Texas and North Dakota. What would you say have been the biggest consequences so far?
ML: At the most basic level, we’ve flipped expectations about US oil supply and natural gas supply on their heads. There’s no question that that’s the biggest piece.
One thing that’s been surprising, though, is that oil prices have remained near record highs over the past few years. And the best explanation for that it’s been a coincidence. We’ve had surprising US gains in production that have been offset by surprising losses elsewhere, due to geopolitical disruptions [in places like Libya, Iraq, and Iran]. So oil prices have stayed relatively high:
And that explains in part why you’re also seeing large gains in other energy sources, too, or in efficiency. We’ve had this oil and gas boom but we still preserved the environment in which people need to worry about energy scarcity.
GAINS IN US OIL PRODUCTION HAVE BEEN OFFSET BY GEOPOLITICAL DISTURBANCES
As for impacts, a lot of people are still struggling to grapple with the consequences of this boom. One big question is how does increased US production of oil and gas affect the standing of the United States in the world and its ability to influence world events. So whether that’s the role of natural gas in putting pressure on Russia or the role of oil in making it easier to impose sanctions on Iran, there’s still a lot of debate about this.
The second thing people are struggling with is how to react to this boom while remaining serious about climate change. We’re still trying to understand whether natural gas can be a “bridge fuel” or a waste of time. Policymakers and activists are trying to figure out whether going after and restricting fossil fuel production is a useful way to reduce emissions. There’s still enormous controversy in all those areas.