Saturday, July 18, 2015

The good and bad of fracking

You've probably heard the one about the one-handed economist, but what can I say: the world is complicated! Here are the two sides of fracking. New study, out July 15th, finds that hospitalizations related to a variety of ailments (including heart, skin, brain, and others) are up in places where fracking is happening. On the other hand, cheaper energy and other benefits saved people (mostly in the South) about $48 billion per year from 2007-2013. Note that this is NOT an estimate of corporate profits: actually the dropping price of energy cost industry about $26 billion, but the benefits added up to $74 billion per year over that time, so the net benefit [NOT including the health/ environmental damages] was the $48 billion.

So, how do you balance that?

One other thing to keep in mind: doing good accounting means that we also need to think about what the fallback option is. If we, say, tax fracking (and a ban can be considered a really high tax) then what happens? The country's energy mix may shift a little bit in ways you want it to, like toward renewables and maybe nuclear, but it will also shift a lot back toward what it was ten years ago, which is toward coal. Coal mining and burning is linked to at least as many health problems as fracking, I'm sure! Not to say that fracking should therefore be given free rein, just that we need to recognize that the balancing is happening in a context....

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