Shale Revolution Helps Prevent More Than 11,000 Deaths Annually
Lower heating costs – brought on by increased natural gas production from the shale revolution – reduced winter mortality rates from 2000 to 2010, according to a new National Bureau of Economic Research paper. As the NBER paper explains,
“We find that lower heating prices reduce mortality in winter months. The estimated effect size implies that the drop in natural gas prices in the late 2000s, induced largely by the boom in shale gas production, averted 11,000 winter deaths per year in the US. We also find that the effect does not just represent short-run hastening of mortality.” (emphasis added)
“This effect size is large enough that it should not be ignored when assessing the net health effects of shale production of natural gas.” (emphasis added)
Reduced natural gas prices led to decreases in winter mortality rates.
According to the paper, research has shown that mortality rates tend to be higher in winter months when higher energy costs can force consumers to reduce the temperature in their homes or offset heating costs by reducing spending on other items like food and medical care. For perspective, a 2018 Energy Information Administration report found that in 2015, at a time when total U.S. energy expenditures were at their lowest since 2002:
- roughly 31 percent of households struggled to pay energy bills or maintain adequate heating and cooling levels,
- one in five households paid energy bills over other necessities such as food and medicine,
- and 11 percent of households admitted to “keeping their home at an unhealthy or unsafe temperature.”
The NBER researchers explain that from 2005 to 2010, when U.S. shale production began to take off, U.S. households saw a 42 percent reduction in the price of natural gas relative to electricity. This price reduction, in turn, had a direct impact on winter mortality rates. From the NBER paper,
“Our findings imply that this price decline caused a 1.6% decrease in the winter mortality rate for households using natural gas for heating. Given that 58% of American households use natural gas for heating, the drop in natural gas prices lowered the US winter mortality rate by 0.9%, or, equivalently, the annual mortality rate by 0.4%. This represents over 11,000 deaths per year.” (emphasis added)
In other words, the shale revolution has helped to save tens of thousands of lives annually thanks to an abundance of natural gas driving down consumer costs. And as another 2018 EIA report found, these energy costs have continued to fall beyond the scope of this NBER paper.
Mortality rates decline in top shale counties in Pennsylvania and Colorado.
Not only can reducing energy costs play a key role in improving the health of a community, as this recent NBER paper shows, but so too can improving a community’s overall economic health.
EID recently analyzed publicly available health data for mortality rates in top oil and natural gas producing counties in Pennsylvania and Colorado. In both reports, EID found that despite growing elderly populations and a sharp increase in oil and/or natural gas development, mortality rates declined for every major health indicator over a period of more than a decade. While neither of these reports specifically evaluated whether the shale industry has been responsible for the decline in mortality rates, shale development has increased tax revenues, saved consumers money, and spurred economic development.
As Sue Mickley, author of the Pennsylvania report, explained, “It has been common knowledge in the field of public health that the economic health of a community influences the status of its citizens.”
Whether it be reduced energy costs – as this recent NBER paper analyzed – or improved air quality and increased job security, one thing is clear: The shale revolution is benefitting Americans.