CEU Associate Professor of Public Policy Andreas Goldthau doesn't care about innovation in the shoe industry. Or the chair industry, for that matter. If you have some sort of technological advancement in the shoe sector and then you find out it wasn't so great in the end, the fallout is limited, he noted. However, getting something wrong in the energy sector has massive consequences.
"Energy is the lifeblood of modern economies," Goldthau said. "The energy sector cannot fail for even one day. It is the most important sector because it fuels all other sectors."
Not to knock stilettos, but Goldthau doesn't imagine that profound world changes will come from the shoe or chair industries as they are not "crucial sectors." But, as quickly as shoe trends sweep the globe, some technological innovations have stalled. An expert in energy security and global governance issues related to oil and gas, Goldthau wants to know, specifically, why shale gas hasn't taken off as a primary energy resource in some countries. Last spring, Goldthau won a Marie Curie Fellowship to research shale gas innovation technology as well as technology transfer at the Belfer Center for Science and International Affairs at Harvard University's John F. Kennedy School of Government.
Shale gas has been simultaneously christened as societies' savior and demonized as an environmental assassin. But the fact that there are massive worldwide reserves, proven extraction technology, and an ever-greedy consumption base means it will remain a centerpiece of the energy sector. In fact, the U.S. has become completely self-reliant in natural gas because of shale and some in the industry see shale sparking a "second American Industrial Revolution," Goldthau said. Innovations that lead to booming industries are not only big job creators but, in the case of shale gas, money savers for large sectors that produce plastics and steel, for example. The price of one million BTU (British Thermal Unit) of gas has dropped from $14 in 2006 to $2.50 today due to the abundance of shale gas.
"The U.S. has really invested in shale gas because it's a sizable economy – the largest in the world by country. It has enough capital, the proper technology, 150 years of extraction experience, and an entrepreneurial sector that has produced for a domestic consumer base. This is a wonderful recipe for success," he said.
There are other countries that might not have the wealth or technological know-how but do, in fact, have large reserves of shale gas but have chosen not to take advantage of it. Goldthau wants to know why. "You can have a good idea that becomes a commercial product and this can become a thing that sells in a given market but then it stops - the product doesn't go beyond the market where it was invented," he said.
Some countries, especially after the financial crisis, are economically shaky but a long-term investment that would free them from dependence on foreign oil seems a solid plan. Germany, one of Europe's wealthiest countries, is not hampered by lack of financial resources but it is stagnant in terms of fossil fuel energy innovation.
"Germany imports all of its oil and 90 percent of its gas and France, Italy, and Central European countries have, for years and years been entirely dependent on foreign resources," he said. "I think it has to do with the very domestic context in which an industry operates – the regulatory governance."
Goldthau pointed out that some European countries – namely Poland and the UK – are committed to using shale gas to reduce dependency on foreign sources. Technology and policy transfer are underway, but they are a long way from having robust industries.
"Some countries don't have the necessary inner regulatory framework to, for example, tax shale gas," he said, "There is no policy and some don't have any experience, while others don't have the necessary workforce. What I'm trying to find out in these complex settings is, what makes a country conducive to this happening or preventive."
