The Australian Council of Learned Academies (ACOLA) recently released a report examining the spectrum of issues facing the development of a shale gas industry in Australia. I couldn’t help but agree with the emphasis on the importance of the social licence to operate and believe that it is as important, if not more important for the future development of the sector than the technical aspects of shale gas production.
It’s a soft issue with hard consequences.
ACOLA’s report comprehensively outlines the technical challenges posed by the Shale Gas industry. However, I believe the real challenge to the shale gas industry lie’s in human nature not in the use of our tools.
In this post on nukes and lotto tickets, I point out one human thinking failing that is fundamental to the energy sector, and that is people do not assess risk on an even continuum. We assess high tailed risks disproportionate to their probability, particularly if there is an emotional pay-off associated with the risk.
Less formally, this is why we have lotto but not nuclear power.
Taxing the wallets of the mathematically challenged aside, there are serious consequences with this thinking failure. After the September 11 terrorist attacks in the US there was a sizable decline in the number of air travellers. A clever mathematician examined the number of road accidents that followed the terrorist attacks and found that 1,500 more people died in road accidents than if they had continued flying.
The ACOLA report goes to great pains to lay out the rational risks associated with shale gas. This is fantastic work but it needs to be noted that people’s response to this risk is not rational. The engineers who will develop and oversee these projects probably skew that way as well.
It would be easy for them to underestimate the irrationality of our fellow humans.
The same irrationality threatens all forms of non-status quo energy sources. Not just nuclear power, but wind has its irrational opposition.
ACOLA’s report is a great first step to having a rational debate on the topic of shale gas as it identifies all the risks and puts forward mitigation strategies. As a non-vested interest it is fantastic contribution to the debate.