The government today lifted the ban on hydrolic fracturing for shale gas or gas “fracking” in the UK, paving the way for access to a potentially abundant source of natural gas. This, in turn, could result in cheaper prices for consumers, as has been in the case in the US over the last five years.
Welcoming the move, Hamish Roberts, CEO of Global Power Specialty at Aon Risk Solutions, comments: “The processes behind fracking have been around and supported by the insurance industry for the best part of four decades. Insurers are likely to become increasingly cautious regarding third party earthquake exposure and downstream pollution liabilities but both of these are manageable risks. As a result, today’s announcement should not present any significant challenges from an insurance point of view.
“Ultimately, shale gas has the potential to be an economically viable way of meeting the growing demand for power in the short-to-medium term and today’s decision ensures that fracking could be a major element in the British energy mix in the future.”
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