The energy secretary gives the go-ahead to resume fracking, the controversial process of drilling for gas by splitting shale. But environmentalists say it has no place in a low-carbon economy.
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Attempts to exploit the unconventional gas in Lancashire, by the gas company Cuadrilla, were put on hold 18 months ago after fracking caused two small earthquakes near Blackpool.
But Energy Secretary Ed Davey said on Thursday that fracking, which uses high-pressure liquid to split rock and extract gas, could resume in the UK, subject to new controls which aim to reduce the risk of seismic activity.
Mr Davey said shale gas represented a promising new potential energy resource for the UK, although it was not yet known what contribution it could make to the energy mix, jobs and the economy.
Read more: is fracking the answer to our energy needs?
But environmentalists warn that a continued reliance on gas would prevent the UK meeting targets to cut emissions and tackle climate change, and that shale has no place in the move to a low-carbon economy.
Other areas where fracking for shale might be pursued include near Balcombe, West Sussex, and in the Mendips, where concerns have been raised about the effect on the world-famous hot springs at Bath.
Concerns have also been raised, following widespread exploitation of shale resources in the US, that it can cause local environmental problems including polluting water supplies and damaging development.
He insisted that exploiting shale gas in this country would not undermine efforts to cut emissions to tackle climate change, instead emphasising the advantages in developing domestic supplies.
The Treasury has already signalled its support for the budding industry, proposing tax relief for shale gas, and unveiling a gas generation strategy.
Shale gas has given a huge boost to the gas industry in the US, and now accounts for 95 per cent of the natural gas consumed there domestically. The Energy Information Administration predicts that gas production will see a 44 per cent increase by 2040, and that the US will become a net exporter of natural gas by 2020 - two years earlier than previously thought - as a result of the new gas available through fracking.
Cuadrilla believes that the Bowland shale formation in Lancashire could hold as much as 5.7tcm (200 trillion cubic feet) of technically recoverable gas, and says that reserves in Lancashire could supply a quarter of the UK gas demand in the future. However, other expert estimates of the amount of gas are less generous.
But Nick Riley from the British Geological Survey told Channel 4 News that drilling and testing or shale gas will allow Britian to assess the economic potential and environmental risks of shale gas.
"Gas is the greenest of the fossil fuels and may have a role in reducing carbon emissions in countries which are dependent on coal for electricity generation, but shale gas also has high emissions from all the energy used in drilling and fracking," he said.
"If gas power generation is connected with carbon capture and storage the convenience of home grown gas can be combined with very low emissions to help keep Britain within its emissions targets."
Mr Davey said the development of shale gas exploration would develop slowly, and would not come "at the expense of local communities or the environment".
"We are strengthening the stringent regime already in place with new controls around seismic risks," he said. "And, as the industry develops, we will remain vigilant to all emerging evidence to ensure fracking is safe and the local environment is protected."
The controls will include a traffic light system, requiring operators to stop if seismic activity reaches a certain level, magnitude 0.5, which is well below a quake that could be felt at the surface but higher than normal fracking levels.
After obtaining planning permissions, environmental permits and consent, Cuadrilla hopes to have initial data on how much gas it might be able to extract by the middle of next year.
The go-ahead for fracking to resume comes as the government's climate advisers are warning that a continued reliance on gas will push up consumer bills by hundreds of pounds more than if there was a shift towards low-carbon power such as wind.
The committee on climate change's chief executive, David Kennedy, dismissed claims that exploiting shale gas in the UK and Europe could push down gas prices.