The world’s energy equation is rapidly changing. Three recent developments have altered energy options, re-calibrated the calculation of supply and transformed the implications for the planet’s environment. Unfortunately, renewable, pollution-free energies – although they continue to make advances – are not in this equation.

The most recent development has been the nuclear meltdown at Fukushima Daiichi in Japan on March 11, 2011, an event that shocked the energy sector and sent many countries scurrying to reconsider their energy sources. Germany, Switzerland, Italy and Malaysia have all decided to either abandon or phase out their nuclear power plants. Japan is reviewing and reducing its nuclear strategy. The escalating cost of building such plants, the multiplication of safety systems and the dramatized risk of meltdown are now measured as being too high for practical purposes – the immediate economic damage of the Fukushima Daiichi disaster is estimated at $235 billion and the 1986 Chernobyl meltdown is presently at $200 billion and counting.

The second development in the energy equation is the discovery of shale gas and the technology to access it. Horizontal drilling and “fracking” (hydraulic fracturing) has opened huge supplies throughout North America and elsewhere. Natural gas can serve as a partial substitute for the diminishing supplies of conventional oil. In an energy-hungry world, it will be exploited to the fullest to produce heat, electricity, fertilizer and even diesel. Natural gas can also be used to power vehicles directly – 11 million gasoline engines have been converted to this use but, as an indication of future trends, General Motors is now designing production engines that will burn only the anticipated supply of cheap and plentiful natural gas.

The third development is the discovery of more oil – a lot more oil. As conventional wells decrease in number and production, shale oil is replacing them, multiplying known and recoverable reserves while changing the world’s economic, political and energy calculus. The technology that has made shale gas economically feasible has also exposed huge supplies of shale oil. Faster drilling has reduced access from 65 to 25 days (Globe & Mail, June 29/11) and has decreased production time from two years to eight months (National Post, July 2/11).

One surprising source of this new oil is Israel’s Shfela Basin, located just a short drive south of Jerusalem. With a supply of 250 billion barrels of recoverable shale oil, it may be the third largest reserve in the world, and it may have twice as much as Saudi Arabia’s 260 billion barrels of crude (Globe & Mail, June 29/11). The Shfela Basin has enough high quality oil to supply both Israel and the US, at a combined annual consumption of 8 billion barrels, for the next 200 years.

The other source of shale oil is the US. At least 20 new oil-rich shale basins have been identified, including Eagle Ford in Texas, Bakken in North Dakota, and Green River which straddles Colorado, Wyoming and Utah. The Green River basin alone contains a recoverable 1.38 trillion barrels or five times the Saudi Arabia equivalent. Meanwhile, Alberta’s huge oil sands reserve continues to ramp up production to meet the world’s energy hunger.

All this doesn’t mean that oil will become a plentiful commodity. Consumption is rising rapidly in China, India and Brazil just as old oil sources are steadily declining. But new supplies of shale oil portend radical changes at every possible level of the energy equation. More oil delays the “peak oil” crisis, undermines the prospects for electric and hydrogen vehicles, impairs the future of non-polluting solar and wind renewables, and alters the entire geo-political structure that has been infecting world politics for decades. But the biggest change – and the most dangerous – may be the difficult matter of reducing greenhouse gas emissions.

Three decades of effort by a global civilization powered with fossil fuels has not been able to reduce carbon dioxide emissions. Indeed, our best efforts to date have only been able to slow the annual rate of increase. Meanwhile, pre-industrial atmospheric carbon dioxide levels of 280 parts per million have risen to about 393 ppm today, a trajectory with extremely serious implications for climate, ecologies and human health, security and agriculture – climatologists estimate that we need to return to about 350 ppm to maintain the traditional climates that have accommodated our historical settlement of the planet. Given rising world populations, spreading industrialization, expanding materialism and an increasing demand for energy, the prospect of decreasing CO2 emissions – even with the aid of greater efficiencies – seems ever more challenging.

Given the failure of past political effort to reduce emissions, those concerned about climate issues had hoped shortages of oil would eventually force up fuel prices, encourage innovation, create clean energy alternatives and reshape our economic world to a more benign influence. However, given the recent discovery of massive amount of new oil and gas, this imposed option now seems unlikely, at least for the immediate future.

So, where does this leave us? We now have sobering scientific knowledge about climate change and the dire prospects that lie before us if we don’t dramatically cut carbon dioxide emissions. We also have promising technologies for supplies of clean, renewable energy. But we also have the temptation to burn massive new supplies of oil and gas. Ironically, as our ingenuity saves us from one inevitability, it threatens us with another. The power of our inventiveness has once again provided us with solutions that come with even more challenging problems. How we judge our situation, weigh our options and summon our resolve is more important than ever before.