Business

Fracking 'could lower house prices' says draft official report

There has been local opposition to shale gas test wells Image copyright Christopher Furlong/Getty
Image caption There has been local opposition to shale gas test wells in the UK

Fracking could reduce house prices, increase traffic and noise and damage the landscape in rural communities, according to a draft official report.

The government was forced to publish the unredacted report after a decision by data watchdog the Information Commissioner's Office.

Defra said the report was incomplete and "not analytically robust".

It added that the conclusions of the draft report "amount to unsubstantiated conjecture".

United Kingdom Onshore Oil and Gas (UKOOG), the industry lobby for the UK onshore oil and gas industry, said the report was "in danger of extrapolating the experiences of other jurisdictions that have different regulation, planning regimes and geologies."

The internal document - called 'Shale Gas: Rural Economy Impacts' - had several key sections obscured when it was published by the Department for Environment, Food and Rural Affairs (Defra) last summer in response to a request under freedom of information laws.

Energy and climate campaigner Daisy Sands of Greenpeace, which led the request, said: "It's a complete vindication of Lancashire County Council's decision to reject Cuadrilla's bid to frack in their region, and provides other councils with compelling reasons to do the same."

Insurance costs

Defra has now been forced by the Information Commissioner's Office to publish the document in full.

It reveals that potential negative impacts of the controversial process of fracking had been redacted.

Among the deleted sections were suggestions that house prices could fall by up to 7% in close proximity to shale gas exploration sites, while rental prices in the area could be pushed up by people coming to work on the developments.

Properties located up to five miles from the fracking operation could face additional insurance costs to cover losses in case of explosion on the site, the study suggested.

While the redacted version of the report flagged up the job opportunities created by fracking, the unredacted version also sounds a note of caution, warning it was less clear how sustainable shale gas investments would be and if rural communities would be able to take advantage of them.

"New York state has just made its fracking ban permanent," said Greenpeace's Ms Sands. "The only sensible course of action for the government is to declare a fracking moratorium and establish a truly independent inquiry to look at the wealth of available evidence about shale gas impacts."

Greenhouse gasses

According to the document, shale gas developments "may transform a previously pristine and quiet natural region, bringing increased industrialisation".

It adds: "As a result, rural community businesses that rely on clean air, land, water, and/or a tranquil environment may suffer losses from this change such as agriculture, tourism, organic farming, hunting, fishing and outdoor recreation."

The study also said that while domestic shale gas production could reduce emissions by replacing imports of liquefied natural gas (LNG), if that displaced gas was used elsewhere it would push up greenhouse gases globally.

Waste water from fracking operations could place a burden on existing treatment facilities, it added.

A Defra spokesman said: "We respect the independent decision of the Information Commissioner's Office and have today released this paper in full.

Image caption Anti-fracking protests have been held outside Lancashire County Hall in Preston

Analysis: John Moylan, BBC business correspondent

This report was written early last year - not long after the Prime Minister said the Government was going all out for shale.

It was finally published - heavily redacted - just weeks after the government invited new players to enter the UK's shale sector with the launch of the 14th onshore licensing round.

So the report wasn't exactly "on message" with the views coming from the Treasury or Number 10 at the time.

In August, Defra defended the redactions saying that the report was incomplete and contained potentially misleading information that might undermine the public debate.

We now know that around a third of the original report was cut out - much of this material throws a negative light on fracking.

And given our national obsession with house prices - that 7% figure is likely to be highlighted every time communities face a fracking development on their doorstep.


'No new data'

"This document was drawn up as a draft internal discussion paper - it is not analytically robust, has not been peer-reviewed and remains incomplete.

"It does not contain any new data or evidence and many of the conclusions amount to unsubstantiated conjecture which do not represent the views of officials or ministers."

UKOOG said that while the report indicates that house prices near shale gas sites may fall as a result of "negative perceptions", it says the "evidenceā€¦is quite thin and the results are not conclusive".

"The experience in the UK of homes near major oil and gas production sites does not show any negative impact," the lobby group said.

Ken Cronin, chief executive of UKOOG, said: "It is a shame that this report has become such a cause celebre as it is merely a review of literature and brings nothing new to the debate or any new information in a UK context."

Related Topics

More on this story