The Geopolitics of Shale Gas

Figure 1: Research design for the study, using 2 SD models to capture both energy redirection and political rebalance.

A study by RDMlab partners Willem Auping at TU-Delft and Sijbren de Jong at HCSS uses System Dynamics (SD) models for Scenario Discovery to project likely future geopolitical and market consequences of the U.S. shale gas boom on Europe, through 2050. These SD models use interacting feedback loops and accumulation to explore possible energy system and country stability futures, under deep uncertainty.

Scenario Discovery fits within the broader Exploratory Modeling & Analysis (EMA) methodology, and can be referred to as Exploratory System Dynamics Modeling & Analysis (ESDMA), allowing for exploration of systems both complex and uncertain. The top-down approach which SD takes to parse uncertain assumptions contrasts with model techniques like Agent Based Modeling (ABM), and accounts for continuous change in model variables. Using the SD modeling approach, long-term consequences of the shale gas revolution were quantified in an Energy Price Scenario model and in a Country Stability model.

Results from these model runs suggest that the indirect, uncertain effects of the shale revolution will likely be more significant and enduring than the assumed direct effects that literature is able to show. Not only will the shift in energy demand and distribution create redirected energy flows among stakeholder countries, but an ensuing shift in resource power may incentivize the U.S. to rebalance foreign policy that hinges on an indefinite supposition of energy import dependency.

Learn more and download the report (hcss.nl)