1. Citizens petitions on shale gas extraction in Bulgaria and Poland Workshop on The exploration and exploitation of shale gas in the European Union and its impact on the environment and the energy policy, from the perspective of petitions received Tuesday, 9 October 2012, from 15.00 to 18.30 Committee on Petitions, European Parliament, Brussels Michael LaBelle, Assistant Professor, Central European University, CEU Business School and Department of Environmental Sciences and Policy

2. Viewing Risk: State, Society and Firms Interactions State supported energy projects Cooperation - government and firms Society tells us what is important Risks Potential risks inherent with extracting shale gas How the use of shale gas mitigates other risks

3. Categories of Petitioners Concerns

4. Risk categories for shale gas extraction

5. Poland By September 2012, an estimated total of 27 unconventional exploratory wells had been drilled in Poland, with an expected 34 to be completed by the end of 2012; this is below the governments projection of 45 wells.

6. Polish shale gas areas

7. Polish methodology – find out perspectives 16 interviews – Institutions, companies and academia September 16 – 21, 2012 Economic Forum September 4-6, 2012 Document review Weakness: top-down (at this point) Strength: Understand how state and companies moving in same direction

8. Polish electricity mix

9. Poland - key findings: (1) The State Polish shale gas is becoming a state project where different state institutions and state owned firms are actively involved Activities and findings by state ministries are not shared. No official mechanism or channels for more open sharing of planned activities or concerns There is a lack of research focused on the economic and social impact of shale gas extraction in Poland

10. Poland – key findings: (2) Why shale gas? Shale gas in Poland is a potential strategic domestic energy source The shale gas sector is viewed as an innovative sector that can play a leading role in Polands economic development Shale gas can: 1) replace declining conventional gas on the Polish market, 2) replace coal, 3) mitigate international price volatility and 4) prevent a greater Russian gas dependency.

11. Poland – key findings: 3) Environment Significant shale gas may not lie underneath Natura 2000 areas. Time lag in reviewing shale gas exploration plans/staffing size Regulations adjusted as experience grows with shale gas exploration. Gas power plants using shale gas, compared to future domestic coal power plants, offer avoided CO2 emissions of 51% to 64% for electricity generation using gas. With current inefficient coal power plants, avoided emissions using shale gas are 70% to 78%. In 2050, Lignite coal (the most CO2 intensive source of energy) will still comprise 15% of the energy mix, with the use of renewable energy sources (RES) not rising above 20%.

12. Recommendations: Poland Polish shale gas is a state project sufficient independence must be given to state bodies International best practices for shale gas Social and environmental sciences need funding as well. Natura 2000 areas clearly defined and clearly communicated – a voluntary agreement for drilling ban? Changes to Polands energy tax and royalty regime Research: Does shale gas displace RES or coal on the Polish market?

13. Bulgaria

14. Bulgaria- Key findings Since January 2012, the use of hydraulic fracturing to extract Shale gas has been banned in Bulgaria Bulgaria is heavily dependent on Russia for most of its gas supply Gas contracted from Russia provides a stable and predictable price Over the next 5 to 10 years greater sources of gas will become available to Bulgaria, without shale gas, the country will still have sufficient options to diversify away from Russia

15. Bulgarian risks and dependency

16. Categories of Petitioners concerns

17. General recommendations The potential displacement of coal by shale gas across the EU must be studied, GHG emission important to consider – impact on RES development must also be assessed Study tours of the US and Canada should continue to be conducted Administrative capacity risks are highlighted 1) as a potential barrier to ramping up shale gas extraction; and, 2) for ensuring the environment and citizens are adequately protected. Shale gas is changing the global gas market and understanding how this can affect European - particularly Eastern European - energy security must be part of the debate.