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Anorak | Yes of course Ed Davey’s lying about fracking?

Yes of course Ed Davey’s lying about fracking?

by | 25th, September 2013

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YOU know, politician, lips moving and all that. But how he’s lying is just as important as grasping the fact that he is lying. Each particular thing that he says is more or less truthful but the overall impression left is entirely untruthful:

“North Sea gas didn’t significantly move UK prices – so we can’t expect UK shale production alone to have any effect,” Mr Davey said, pointing out that Britain is just one part of the wider European gas market.

He said it was “far from clear that UK shale gas production could ever replicate the price effects seen in the US”, where the shale gas boom has seen prices plummet.

The comments stand in stark contrast to those of David Cameron, who wrote in the Telegraph last month that “fracking has real potential to drive energy bills down”

Yes, it’s true, we don’t expect fracking in the UK alone to have all that much effect upon prices. Indeed, we don’t really expect fracking across Europe to push prices down. Both of those are true in detail. But we end up with the impression that fracking isn’t going to change prices and that’s just not true. There’s a long piece on this here but the core of it is as follows.

There have been two reports into the effect of fracking on future gas prices, both by the research company Poyry. The first one looked at the effect upon gas prices in the UK of a variety of different fracking options. Id Poland fracked a lot, if it only did a bit or if it did none (and it was pretty much the effect of Poland that they looked at as well). If there’s lots of Polish fracking then UK prices will be about the same as they are now, 40 p a therm or so. If there’s a bit, they’d be 50% higher, at 60 p odd. And if near none then way up at 80p.
It’s true that we don’t expect fracking to push gas prices down: but we do expect it to stop prices rising. So there is indeed an effect upon prices. The second report concerned the effect upon prices of the Lancashire gas find by Cuadrilla. Actually, just a part of it, much smaller than the amount we now think is there. And that would push down UK prices by 2-4% from where they would otherwise have been without it.
For all of Europe by the way.
So, yes, Ed Davey’s not doing the lie direct he’s doing the lie by omission. But that’s still a lie, right?



Posted: 25th, September 2013 | In: Money, Politicians Comment (1) | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink