With energy prices on a steep upward curve fracking for gas has re-entered the energy debate. Ineos, a global petrochemicals manufacturer, has written to the UK government arguing that it should be allowed to restart fracking. But how strong is their argument?

On 11th April 2022 a Director of Ineos was interviewed during the business section of Radio 4’s Today programme. He put forward a number of points for restarting fracking ( for a transcript of the interview click here ).

The strength of an argument depends on the validity of each point supporting it and whether it leads to a valid conclusion. Also, it would be unfair to take the interview literally because of the time constraints of a radio programme, in this case just under 4 minutes. Therefore I have expanded and corrected some of the points to clarify their meaning ).

Fracking in the UK started in the late 1970s and it was mainly offshore. Onshore exploration for shale gas started in 2008 and was pursued until 2011 when drilling in Lancashire, by Cuadrilla, was halted after fracking caused two earth tremors. In 2019 the UK Government stopped its support for fracking because it was found that it was not possible to accurately predict the probability or magnitude of earthquakes linked to fracking operations. Ineos have a wide range of licences to pursue oil and gas activities in the UK. In 2015 they were awarded three shale gas exploration licences covering an area in the east Midlands. A further 21 licences were granted in December 2015. Against a background of increasing gas prices, it was reported on the 5th April 2022 that Business Secretary Kwasi Kwarteng had ordered a scientific review of fracking to assess any changes to the science around fracking.

During the interview the following points were made for restarting fracking:

Point 1: The company has spent £250 mn on exploratory fracking for gas.

It is not clear why this point was being made. Was it because Ineos had invested a large amount of money in fracking and therefore they didn’t want to lose it, or was it that they could quickly restart gas exploration to support the science?

Point 2: There is massive value for the economy and for deprived areas from shale gas.

There are two parts to this point. First the reliance of gas on the UK economy is significant. About 85% of households are heated using gas and around 50% of electricty is generated by gas. The UK imports at least 60% of its gas and is projected to increase to 70% by 2030. Secondly, linking deprived areas to a potential increase in shale gas production is complex issue. The factors affecting deprivation are more than economic. For example they include other factors such as crime, education and the environment all of which fall under the control of local and national government.

Point 3: Ineos will guarantee 6% of the value of the gas, not the profit, to local communities.

It was not clear how the guaranteed amount was arrived at. Why not other financial mechanisms to support local communities?

Point 4: There is a huge amount of shale gas but there is a need to do the science to assess how much can be extracted safely.

There is an ongoing debate about the amount of shale gas in the UK and estimates vary. For example in the UK there are shale formations bearing oil in the south and gas in the north. The Bowland Shale in the north of England is thought to contain about 1,300 trillion cubic feet (Tcf) of gas. By comparison, the UK consumes about 3 Tcf per year. However, it is believed that only a small proportion of gas in the Bowland can be extracted – maybe only about 4%.

Point 5: Although gas is not an energy security issue it can have a high price because it has to be bought on the spot market.

With a high dependency on imported gas ( see Point 2 ) then the spot price is driven by global issues. However, the UK government has stated in its latest British Energy Security Strategy, published on 6th April 2022, “that it will accelerate the deployment of wind, new nuclear, solar and hydrogen, whilst supporting the production of domestic oil and gas in the nearer term – with the target of 95% of electricity by 2030 being low carbon.” If the target is met then the UK’s dependency on gas would be reduced within the next 8 years. Against this time scale, it would be a steep challenge to establish the safe extraction of shale gas and produce it at a level that would have any impact on the UK’s gas imports.

Point 6 The UK government takes half in tax when produced in the UK.

The tax on oil and gas is a complex subject and depends on a number of factors. When I asked the North Sea Transition Authority about the level of tax on gas production in the UK they replied that it would be 40% but depended on certain criteria.

The strength of the points put forward in the interview are mixed. Although they did cover the strategic issue of energy security they didn’t address the climate crisis or how fracking would fit in with the UK governments stated medium to long term aims of reducing the UKs reliance on hydrocarbons.

I’m sure that many other companies with interest in fracking will be putting forward similar arguments to the UK government - will they frack or not frack?

When tradespeople carry out work on your house then it can go one of three ways: better than expected, neither good nor bad, or a nightmare. Hopefully the following tips will avoid the nightmare.

Over the years we have gathered lots of experience of tradespeople carrying out work which has ranged from emergency plumbing to house extensions. Sometimes the job goes better than expected and gets a tick in the “good job well done” box. At other times the job doesn’t quite meet expectations and then it falls into the “okay” box. But there is the job that starts on the wrong foot: a delay to its start, the quality of work is poor or they are messy. At each step the problems get worse and blood pressure screams off the scale.

The following tips have been gathered over many years of work being done our house and should help avoid the nightmare job.

Clarity is Everything

Be clear about the work that you want to be done. If it is wallpapering then make sure that you have selected the wallpaper samples, worked out the area and selected the paint colour for the woodwork. For a house extension then draw out on the ground the space that you are looking at and then where the doors and windows should go and check the direction of sunlight before moving onto the next stage of finding an architect. The more information that you can pin down about the work that you want doing then the easier it is to describe it to the tradespeople.

The Rule of Three

The “Rule of Three” - get at least three quotes. When selecting the tradespeople ask for recommendations from anybody that you know who have had similar work carried out by them. But make sure that you know why they are being recommended. If there is nobody that you can ask then check them out on the web but be careful. If a company has one or two bad reviews then see how the company responded to them. Nothing in life goes smoothly and if there was an unavoidable problem which was handled fairly then they could still be added to your list for a quote.

When they view the job ask them lots of questions. How they would do the work? What problems do they see? Have they any ideas about making the final work look better? and so on. Do they come across as people who are passionate about their work? One clear example we have is when we replaced our garage doors. We applied the “Rule of Three” but the one that stood out, and eventually got the job, was very passionate about garage doors and their installation. The company that didn’t get the job just took a look at the old doors, which took all of 5 minutes, then submitted a quote that clearly showed that they didn’t understand the job that we wanted.

When the three or more quotes roll in, make sure that when you compare them they are quoting for what you have asked. If you are unsure about anything then phone them up and discuss the areas that are not clear.

The Green Light

We always try and keep most of the communication written, mainly emails, so that we have a record of who said what and when. Let the the winner know and book a date for the work to begin. Be prepared to pay a deposit. Let those who were unsuccessful know. If they want to know why they are not doing the work explain that you found somebody that meets your needs. It can be difficult to say why they didn’t win the work but it is best to be honest whether it is price, timescales or they didn’t specify the work that you wanted them to do. It may help the future of their business.

Tea and Biscuits

When supplying the regular tea and biscuits ( we found chocolate hob knobs go down well ) then it is an opportunity to ask how the work is going. If there is anything that you are unsure about then ask. Some people may think that it can be prying but it shows that you are interested in the work after all you are gong to live with it when it is finished. As the job progresses then you may want to make changes. Discuss it with the tradespeople and get an estimate of cost and additional time before agreeing for it to go ahead. Unseen problems can crop up therefore check the impact of any changes on the price and timescales.

Thanks

If you are happy with the work then follow up with a written thank you. For a nightmare job then silence is the best response. If somebody asks you about the job then describe what went well and how some activities could have gone better.

Following the steps above will not guarantee that the work will go well but they should reduce the chances of it going wrong and in particularly avoiding the nightmare job ( our worst nightmare job was scheduled to last 2 days but took over 60! ).

Sometimes I run into a customer service whose attitude is arrogant. Their approach is we-know-best with a tone of and-this-is-going-to-cost. This happened to me recently but in my frustration I picked up on a trend that will change a company’s attitude to its customers.

Recently I opened the boot of our car to find the the well where the spare wheel sits was full of water. A bit of searching on the web identified the problem and armed with the information I contacted the dealership of a well known global car manufacturer to book it in for the repair. The dealership was about twenty miles away with next to no public transport. However, I was prepared to spend a few hours in the town while the repair work was being carried out. As I picked up the phone to book the car in for the repair I did a rough calculation for the part and the time it would take it to replace it and I arrived at a budget of between £60 to £80. But being fully aware that they can charge more to cover their overheads I was bracing myself for £100. But for that price I felt that the job would be done in a way that I wouldn’t have to return for follow up work ( yes - repair of a repair has happened a few times in my motoring career ). After reception passed me through to the service department I explained the problem and the work that I wanted them carry out but the conversation slewed in a totally different direction: “It will cost £168 for the first hour while we diagnose the problem then we will need to keep the car for three days while we test it by showering it with water to make sure that the leak has been repaired.” What! So I tried again but I got the same reply. After mumbling something along the lines of I needed time to think about it I put the phone down and took a deep breath.

I have come across this approach taken by the companies many times. The underlying assumption is that they know what needs to be done and that the product is so complex that they are the only people that know anything about it. In some instances I have to shrug my shoulders and agree particularly when it comes to electronics. But we are now in the age of the web where information is freely shared. There is usually a video that can give some insight into what a particular problem is and how it can be fixed. Many companies fail to realise that their customers are knowledgable about their products which makes them an “informed customer”.

There is nothing new in having informed customers. In my early days as a student trying to keep an ageing mini on the road with no money there was always a Hayes Manual, which gave step-by-step guidance to its repair and maintenance, and a box of tools by my side. The web has made more information available to tackle many problems from repairing domestic appliances to building houses.

With movements such as The Right to Repair there is a growing demand to be able to repair the products ourselves. Governments around the world are starting to put legislation in place such as: Right to Repair Regulations in the UK, Right to Repair in the EU and Fair Repair Act in the USA that will put pressure on manufactures to design into their products easier ways for their customers to repair their products.

After I put the phone down I searched on the web and ordered the part for £9. However, checking the various videos it was apparent that I had reached the level of my competence and I would have to invest in some specialist tools. Therefore I took it to my local garage, which is five minutes walk away, where they completed the repair for £30. The car boot is now bone dry.

With the information on the web being freely available on any subject that can be imagined then we are moving into an era of the “informed customer”. There will always be a requirement for expertise to repair products but with increasing pressure on living costs and reducing waste to save the planet then the customer doing their own repair work will increase. Companies that fail to pick up on this trend will be left behind and find themselves with silent phones in their customer service departments.

At times it can be difficult to generate ideas for new products. Powers of imagination have been sucked dry by daily routines. Many years ago I came across a technique that is a great way to re-ignite a tired imagination.

A lot of work in product development is filled with routine; making sure that it meets health and safety, finding manufacturing and distribution routes, developing marketing material, checking cultural issues and so on. This can drain any imagination. One way to get ideas flowing is to ask what-if questions.

The technique starts by looking at the problems with a product and asking why it is not selling. Then look at successful products in a different market. Gather all of the information about the company behind the successful product and in particular how they developed the product, introduced it into the market and what business model they are using. The key at this stage is not to get too detailed about the company as that will definitely kill any imagination! Once the material has been gathered the fun bit starts. Ask “What if company x ran company y?” As the ideas start to flow they must be recorded with an open mind for example, without starting to dismiss them as irrelevant or throwing them in the ‘too difficult box’. Then go for a coffee or a walk around the block before coming back to sift through what has been generated, a bit like panning for gold, gently sift through the ideas until one or two shine out for further work.

Let’s look at a few examples. There are many industries that fall under the heading of energy intensive such as food, refining mining, construction and so on which rely on carbon based energy. Many governments around the world are putting decarbonisation strategies in place but they are taking the usual approach of more research coupled with a few industry incentives. It is debatable how successful they will be. We need some new ideas to generate a more radical approach: it is good territory for a what-if question. Tesla is a very successful company whose aim is “Today, Tesla builds not only all-electric vehicles but also infinitely scalable clean energy generation and storage products. Tesla believes the faster the world stops relying on fossil fuels and moves towards a zero-emission future, the better.” Not only has Tesla looked at producing energy efficient cars but some of the key areas that they have developed are; a business model which is based on direct sales and service, not franchised dealerships, so that they remain in close contact with the customer. Its business model pays particular attention to rolling out charging stations that may be the biggest obstacle to the mass adoption of electric vehicles. Tesla has stretched the business model to encompass energy storage systems for homes and businesses. Then the question is “What if Tesla took over the running of an energy intensive company?” How would they look at the energy efficiency say of a glass production plant? What techniques would they employ to reduce the amount of energy to produce say a bottle? Would they increase the amount of software to optimise the plants operation i.e. remote plant optimisation and maintenance? Would they introduce energy recovery and storage systems so that the glass manufacturing can switch more to using only electricity? After a few minutes a number of ideas are generated that are recorded and explored further.

There are many areas where what-if questions could be asked. For example if we are going to rely more on local producers to reduce food miles then part of their problem is supplying their products to the consumer at the same convenience as supermarkets. “What if Ocado took over the distribution system for small food producers?” Another interesting area would be how to tackle the decline in biodiversity. Then a what-if question would be “What if Chester Zoo took over the management of the environment?”

Of course trying to get a radically new idea through an existing organisation’s bureaucracy can verge on the impossible and invariably the idea gets chipped away at until it ends up as a minor modification. However, don’t give up, if it is a good idea then could be worthwhile taking it somewhere else? Although asking what-if questions can be done over a cup of coffee it is much better to get a diverse group of people involved. Why not try a Zoom meeting with participants around the world?

Asking what-if questions can be a great way of generating new ideas for products. It is a way of opening up the imagination and exploring new areas. It takes very little effort apart from gathering some information usually from the web. Who knows, it may help you develop the next breakthrough product!

The quick response of governments around the the world to the Covid pandemic is generating arguments that their response to the Climate Crisis should be the same. But how strong are the arguments?

Discussions in the media about the similarity of government’s response to Covid and the Climate Crisis ranges from blogs, newspapers articles and to esteemed publications such as the Lancet. The argument that permeates through the articles is that both crises have the same characteristics: they are global, a public health crisis, affect how we live, our knowledge about them is supported by science and will exaggerate inequalities i.e. the poor will be affected more than the rich. The key point in the argument is that because both crisis have the same characteristics with the same consequence of high death rates therefore governments should have the same response.

On closer inspection of the authors arguments they fall foul of the analogy fallacy, comparing comparing ‘apples and pears’. The Climate Crisis has been developing over at least 100 years, since the Industrial Revolution, and is only now beginning to have a direct impact on the way that we live. There is a large amount of economic inertia built up from investments in technology and therefore it will take tens of years before any environmental initiatives will have an impact. Solutions to climate crisis already exist but it is overcoming the reluctance to change our lifestyles that is the major barrier. On the other hand Covid has happened at the global level over the last two years which compared to the Climate Crisis is very quick. Solutions in the shape of developing new vaccines are speeding up to deal with the new variants and eventually it will be managed at the same level as flu.

Many of the articles about the connection between the two crisis that are flooding the media are more opinion pieces rather than presenting a strong argument for governments to speed up their response to the Climate Crisis. A better approach would be to look at the characteristics that are similar in both crisis to learn how peoples attitudes and behaviours could be changed to improve their response to the Climate Crisis.

The argument discussed above is not only fallacious but is logically invalid. For more information see 'argument from analogy' or click here for my own analysis.