As countries embrace the vast discoveries of unconventional oil deposits, they must make policy and regulation choices that reflect both the public and private sectors. Phil Sharp of Resources for the Future, Adele Morris of the Brookings Institution, Chris Malins of International Council on Clean Transportation, and David Friedman or the Union of Concerned Scientists discuss national and international policy recommendations and their implications. Monica Trauzzi of E&ETV moderated.
- Research: The extraction of unconventional oil has been made possible by decades of federal support for research and development, Sharp noted. Most of the developments leading to this nascent energy revolution have been unexpected, and significant environmental risks remain, he added.
- Carbon Tax: A carbon tax would be an excise tax, and although it is difficult to monetize the damage of climate change, the tax would be more efficient than tax credits, argued Morris. The revenue from a carbon tax could help reduce the deficit and should be part of the fiscal dialogue, she added. Such a carbon tax should be complimented by policies involving energy efficiency, battery power, and cellular biofuels that can provide a vision for reducing oil use, Friedman said.
- New Rules for New Fuels: Low carbon fuel standards such as California’s are an important policy tool to manage these new unconventional oils, Malins said. With the growth in analytic data on fuel systems, it is easier to shape effective policy, he added. There is a need for carbon standards for other goods and services, Friedman noted.