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Risk Management and Governance Issues in Shale Gas Development

Project activities and products will include:

Project Scope

A steering committee established by the National Research Council will organize two workshops to examine the range of social and decision-making issues in risk characterization and governance related to gas shale development. Central themes would include risk governance in the context of (a) risks that emerge as shale gas development expands, and (b) incomplete or declining regulatory capacity in an era of budgetary stringency. The first workshop will follow the systematic approach to risk characterization recommended in the 1996 NRC report, Understanding Risk, which has not yet been applied in this context. It will engage experts and practitioners in addressing the concerns of a range of interested and affected parties to identify key issues and discussing the state and limits of scientific knowledge on those issues. The second workshop would engage social scientists from several research traditions to apply a variety of insights about risk management institutions to the shale gas case, while interacting with each other and with practitioners. A rapporteur will write a summary of the risk issues raised in the first workshop, the risk management and governance concepts presented at the second workshop, and the discussions at both workshops. The summary might include a selection of signed papers by workshop presenters, after appropriate review. It would note the risk questions posed at the workshops for future analysis and the risk management challenges and opportunities identified, which could be considered in future national discussions about the development and implementation of the technology. It will not offer consensus judgments or recommendations.


Members

The planning committee for this project includes:

Mitchell Small, Carnegie Mellon University (chair)

Susan Christopherson, Cornell University

Abbas Firoozabadi, Reservoir Engineering Research Institute, and Yale University

Bernard D. Goldstein, University of Pittsburgh

Robert B. Jackson, Duke University

D. Warner North, Northworks, Inc.

Aseem Prakash, University of Washington

Barry Rabe, University of Michigan

Susan Tierney, the Analysis Group

Barbara Zielinska, Desert Research Institute

Paul C. Stern, National Research Council (study director)

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Background
Extraction of gas from shale via hydraulic fracturing (“fracking”) presents two faces: an attractive path to inexpensive energy for the foreseeable future, and a number of perceived or real potential risks to the environment and communities.  To date, risk management has been almost entirely oriented toward the extraction technology—there has been no systematic effort to characterize the full range of risks that cause citizen concern. It is also not known if the management regime for these risks is adequate, although it is apparent that it is fragmented if not fragmentary across the country.
 
Risk characterization for shale gas development does not now follow best practices; thus, it may engender mistrust. Moreover, current governmental environmental protection institutions may be unequal to the tasks of risk management. The use of fracking technology appears headed toward a pattern of confrontation that may undermine goals for both energy production and health and environmental protection. Recent efforts by the energy policy community to address the risks, even with the addition of the ongoing EPA drinking water study, seem unlikely to address all the fundamental social and decision-making issues.
 

What is needed is a risk-analytic approach aimed at more adequately informing public choices, and governance models that include more than just legislated regulation, that may hold promise for meeting the challenges of environmental protection in an era of declining regulatory capacity. Fundamental social challenges—not just technological ones—need to be included in the development of policies and best practices.


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