The second phase of a comprehensive new study co-sponsored by the U.S. Chamber’s Institute for 21st Century Energy was released Wednesday, highlighting the benefits that shale energy will have on Tennessee’s economy over the coming years. IHS, a leading global energy research firm, is conducting the three-part study to examine the economic impact of shale energy exploration and production across the country. Part one of the report, which focused on the national benefits, was released last month.
According to the study, shale energy production has already created more than 13,500 direct, indirect and induced jobs in Tennessee and is projected to support 23,300 jobs by 2020. In addition, shale energy development will generate $45 million in state and local government revenue in 2012 alone, and from 2012-2035 could generate $1.5 billion in state and local government revenue.
“Shale energy is a game-changer for America and for Tennessee,” said Karen Harbert, president and CEO of the Energy Institute. “The latest installment of this study allows us to quantify just how significant the impact on both state and the national economy will be. It provides all the more reason to strongly support responsible shale energy development.”
Nationally, the IHS study shows that by 2015, shale and unconventional energy will be responsible for 2.5 million jobs; by 2020, 3 million, and by 2035, 3.5 million. In 2012, shale energy is responsible for $62 billion in government revenue. Between now and 2035, shale energy development is expected to contribute more than $2.5 trillion in total government revenue—about half of which goes to the federal government. Overall, between now and 2035, the energy industry will invest more than $5.1 trillion in energy development in the United States.
“Our analysis indicates that both oil and gas producing and non-producing states alike are reaping the benefits of the unconventional oil and gas revolution,” the report says. “Some states benefit through firms that participate in upstream exploration and production, while other states benefit through firms that comprise the vast supply chain supporting unconventional oil and gas development, or both. States also benefit from the interstate trade that occurs as the unconventional oil and gas income effect flows through the economy.”
The IHS study released Wednesday is the second in a three-part series designed to shed light on the economic impact of shale. Wednesday’s state-specific study, as well as part one, focused exclusively on the impact of operations surrounding the extraction of oil and gas (referred to as “upstream” operations).
The final installment—to come in early 2013—will examine the entire economic impact of shale, including components like manufacturing and chemicals (known as “downstream” operations).
The U.S. Chamber’s Energy Institute partnered with the American Petroleum Institute, American Chemistry Council, America’s Natural Gas Alliance and Natural Gas Supply Association to sponsor the study.
The mission of the U.S. Chamber of Commerce's Institute for 21st Century Energy is to unify policymakers, regulators, business leaders, and the American public behind a common sense energy strategy to help keep America secure, prosperous, and clean. Through policy development, education, and advocacy, the Institute is building support for meaningful action at the local, state, national, and international levels.
The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than three million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.