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As Green Car Journal prepared to publish its much- anticipated “Green Car of the Year” edition for 2012, audiences might have expected a tribute to the Toyota Prius, Nissan Leaf, or another innovation in electric or hybrid motoring. Instead, the panel of environmental and automotive experts assembled by the magazine made a surprising choice—one that signaled a sea change in green energy. The judges selected the Honda Civic Natural Gas, an alternative-fuel, partial-zero- emissions vehicle that operates solely on compressed natural gas. As the magazine noted, not only is the Civic’s sticker price of $26,155 more affordable than electric vehicles, the car possesses a driving range and horsepower on par with conventional compacts, but the Civic’s alternative fuel costs approximately half the price of gasoline and is sourced almost entirely from abundant reserves in the United States. Since winning the award, this version of the Honda Civic has paved the way for other natural gas vehicles (NGVs), such as the 2014 Ford F-150 pickup truck and the 2015 Chevrolet Impala.

Against a backdrop of ubiquitous marketing for electric cars and hybrids, the choice of an NGV for Green Car of the Year was an unmistakable nod to a development in green energy that is so immense that it promises to transform the U.S. energy grid and end North American dependence on foreign oil. That development is the discovery of the Marcellus Shale. Located throughout the Appalachian Basin of the eastern United States, the Marcellus Shale is a mas- sive sedimentary rock formation deep beneath the Earth’s surface that contains one of the largest meth- ane deposits anywhere in the world. Once thought to possess a modest 1.9 trillion cubic feet of natural gas, this 600-mile-wide black shale formation below Pennsylvania, Ohio, New York, and West Virginia was explored by geologists in 2004 and was found to con- tain between 168 trillion and 516 trillion cubic feet of natural gas. Combined with other U.S. shale plays, in- cluding the Barnett Shale in Texas, the discovery of the Marcellus led the International Energy Agency (IEA) to rank the United States the new number-one natural gas producer in the world, edging out resource-rich Russia. In addition, the Marcellus has triggered a green-energy boom known as the Great Shale Gas Rush, which is creating thousands of green jobs, revitalizing the nation’s economy, and pointing the way to a clean-energy future.

This breakthrough couldn’t have come at a better time. In a highly turbulent business environment shaken by a global recession and new government restrictions on traditional energy, today’s business managers struggle to know which energy alternatives are viable, or even affordable. The unexpected bankruptcy of well-funded green-energy darlings Solyndra and Beacon Power further underscore the uncertainty of the alternative energy marketplace. To gain stability for their organizations, managers need solutions that are reliable now, not decades into the future.

Thanks to an abundant supply of affordable natural gas, the green energy future has arrived. According to the U.S. Environmental Protection Agency (EPA) profile on clean energy, natural gas is a clean-burning fuel that generates roughly half the carbon emissions of coal and oil while releasing no sulfur dioxide or mercury emissions. Given its low price relative to other energy sources, natural gas has game-changing implications for trucking fleets, consumer automobiles, electric power generation, and commercial heating— not to mention natural gas ovens, clothes dryers, water heaters, and other appliances.

While shale gas is a win-win for business and the environment, its impact on green jobs and the econ- omy is equally important. According to a recent IHS Global Insight study, shale gas production—currently 34 percent of all natural gas production in the United States—will deliver an estimated 870,000 green jobs by 2015. As for the national economy, shale gas contributed $76.9 billion to the U.S. gross domestic product (GDP) in 2010 and is projected to contribute $118.2 billion in 2015. Over the next 25 years, shale gas will raise more than $933 billion in tax revenue for local, state, and federal governments. The news about natural gas is good for average consumers as well. In 2011, property owners in the Marcellus region received $400 million in natural gas royalties—a number that will climb even higher in the next decade. In addition, individual U.S. consumers can expect $926 per year in cost savings related to natural gas. Combined, this economic activity equates to much-needed relief in hard times.

What does the switch to natural gas mean for industry-leading companies? For automakers like Honda and Ford, NGVs have begun making their way into regular assembly-line production. Transport businesses such as UPS are converting fleets from diesel to natural gas as part of the White House’s National Clean Fleets Partnership. Transit leaders like Navi- star and Clean Energy Fuels have launched strategic partnerships to build America’s Natural Gas High- way. Manufacturers such as Westport Innovations have made organizational changes to become leading producers of liquefied and compressed natural gas engines. Utility companies like Dominion are replacing coal-based electricity with gas-fired electric generation. And drillers like Range Resources are finding new ways to improve the quality and safety of natural gas exploration while controlling costs.

There are no limits to the possibilities of the Great Shale Gas Rush. However, it will take visionary leader- ship and skillful management to deliver on the promise of a truly sustainable clean-energy future.

Questions

1. What turbulent forces are causing business leaders to rethink their use of energy?

2. Which managers—top managers, middle managers, or first-line managers—would make company- wide decisions about energy use? How might the new workplace enable all managers to capitalize on the Great Shale Gas Rush?

3. Which historical management perspectives have particular relevance to the exploration and extraction of natural gas? Explain.