The upfront drilling costs of fracking are high. Wells dry up and new wells constantly need to be drilled. So the operating cost of fracking is also high. The data is hidden just like Enron’s but from what is public the productive wells are just barely profitable and most lose money.
The entire gas drilling industry’s future profitability forecast is based on the cost of gas going up. Without government incentives every well would be guaranteed to be unprofitable. And some think the entire Fracking industry is just another giant sized way to scam investors.
See:
New York Times
June 25, 2011
“Whales Were Considered to Be Swimming Oil Wells”; the whaling industry did not disappear because of a whales disappeared. It was because the whale population was diminished and ships had to go farther to bring back whale oil. Cheap oil and kerosene from oil wells killed the whaling industry.
We have reached peak oil and gas and solar fossil fuel cost are rocketing upwards, wind and wave power costs continue to plummet. Coal at least with present day technology is incredibly dirty and unhealthy. Anybody live through the “fogs” of the 1950s and the Donora smog? Coal power would cost a fortune to clean up so it stays dirty. Ask the Koch Brothers.
Sometime within the next decade fossil fuel will uncompetitive. The oil well business that put whaling out of business will be in turn put out of business by sunlight powered technology. Whale oil might be completive again. Car owners could brag about how many whales kill yearly.
Maybe it’s time to send early condolences cards to the Princes of Saudi Arabia and the Koch Brothers. O, I almost forgot Vladimir Putin.
The upfront costs of Solar are high. The operating expenses are low. The Solar industry profitability is based on low operating cost.
The upfront costs of Solar are dropping and expected to plummet far into the future.
SEE:
CLIMATE PROGRESS
Where Renewables Stack Up: Comparative Chart on Levelized Cost of Energy and the “Value” of Clean Energy
AND:
CLIMATE PROGRESS
Solar Panel Prices Continue Dropping, Grid Parity Not Magic Bullet for PV
I left out the Global Heating stuff, droughts, floods, tornadoes, fires and other extreme weather events that are caused in part by burning gas and are driving re-insurance companies out of business. If Global Heating goes unchecked those little infants you see now will be among the last humans to inhabit our earth.
SEE:
grist
GE’s ironic new slogan: ‘Natural gas. It’s hot stuff.’
So which is the better investment?
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