The impacts of shale gas supply and climate policies on energy security: The U.S. energy system analysis based on MARKAL model

The U.S. and other high-income countries face several long-term challenges relating to energy. One is climate change and another, also highly complex and controversial, is energy security. Energy security refers to the robustness, sovereignty, and resilience of energy systems. Energy security and climate policy are frequently presented as two aspects of the same issue. This paper evaluates energy security under long-term energy scenarios and provides analysis to help maintain energy security while meeting other energy challenges. The framework considers vulnerability as a combination of risks associated with energy trade and resilience reflected in diversity of energy sources and technologies. We apply this framework to five scenarios modeled with MARKAL: reference, high shale gas reserves, restricted access to shale gas, CO2 taxes that are equal to Social Costs of Carbon (SCC) and environmental regulation in power sector. Scenarios with high shale reserves and scenario with power sector regulations are associated with lower diversity of energy options. A few risks do emerge under CO2 taxes scenario after 2030 that include potentially high inter-regional trade in natural gas and electricity and low diversity of electricity sources. Net import is lower in the high shale reserves scenario while diversity is higher in a scenario that limits the shale reserves development.