Goldman Sachs
Summary
The U.S. Inflation Reduction Act (IRA) will spur about $3 trillion investment in renewable energy technology that could double the amount of energy produced by the shale revolution 15 years ago, according to Goldman Sachs Research.
The shale boom has allowed the U.S. to produce low-cost energy comparable in scale and efficiency to the Middle East, Michele Della Vigna, head of Natural Resources Research, writes in the team’s Carbonomics report. But even as those reserves of natural gas and oil decline, renewable energy can help the U.S. retain its role as a global cost leader.
“Shale remains a valuable asset, but in our view, the U.S. can no longer rely on it to carry this key cost competitive advantage into the next decade: it needs another energy revolution to maintain its energy cost leadership,” writes Della Vigna, who started the Carbonomics research series in 2019. The early years of the new revolution will focus on electrification, while spending for clean hydrogen and carbon capture will eventually accelerate.
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