The breakthrough energy innovation of the 21st century is not thin-film solar, sophisticated wind turbines, advanced biofuels or small-scale nukes.

It's shale gas.

So says Daniel Yergin, the energy guru and author of "The Quest: Energy, Security and the Remaking of the Modern World" (Penguin, $35), who was interviewed Tuesday by Walter Isaacson at the Aspen Institute in Washington. Yergin, the best-selling author, consultant and all-around energy guru, is right: The ability to extract natural gas from shale, using a controversial technique known as fracking, is reshaping America's energy landscape.

"So far this century, this is the biggest innovation in energy, in terms of scale and impact," Yergin said. He likened its impact on the energy business to the arrival of a new Walmart in town, which shakes up competitors, big and small. 

The impact of cheap, abundant natural gas on energy usage has enormous implications for the climate crisis.

Cleaner-burning gas could replace dirty coal as a fuel to generate electricity. Then again, Yergin said: "It's does create a more challenging marketplace for wind and solar and everything else."

I've just started reading Yergin's book, and it's fascinating. He knows his stuff, did lots of research and writes well, although it must be said that he's an establishment figure who some critics (such as David Roberts of Grist) say is too industry-friendly.

Be that as it may, there's no doubt that shale gas is a force to be reckoned with: Shale gas production grew by 17 percent from 2000 to 2006, which isn't bad, and then it really took off. Better fracking technology (and higher prices) drove the average annual growth rates to 48 percent between 2006 and 2010, according to the U.S. Energy Information Administration. Currently, the EIA says, about 23 percent of U.S. electricity is generated by burning natural gas; by comparison, about 45 percent comes from coal and just 3.6 percent comes from all non-hydropower renewables, i.e., wind, solar, geothermal and waste. The U.S. now appears to have a 100-year supply of natural gas, says the American Petroleum Institute, citing the work of the Potential Gas Committee, a nonprofit group of industry experts.

"In the energy sector, it all comes down to scale," Yergin said.

Yergin views the shale gas revolution as a boon. "This resource will grow and be very beneficial to our economy," he said, because it will create hundreds of thousands of jobs, across many regions. Shale gas is found in Pennsylvania and Ohio, as well as in Louisiana, Texas and Wyoming. Petrochemical plants that left the U.S. when natural gas prices spiked could return. Consumers should benefit from lower electricity and heating costs.

He's confident that the environmental issues around fracking can be resolved. Yergin, who served on an energy department advisory committee on shale gas, said: "The likelihood that fracking is going to affect the water supply is, as the scientists on the committee said, very, very, very unlikely." Local air pollution and waste issues can also be managed, he said. "The need for environmental protection can be met if approached properly," Yergin told a congressional hearing last month. This matches what I've been hearing from companies like Shell.

Yergin does not disparage cleaner forms of energy. Costs of solar are coming down because of low-cost manufacturing in China. Wind, he said, is entering the mainstream. "It's a conventional form of energy," he said. Can wind compete with coal or natural gas without subsidies, he was asked. "There's a lot of argument about that."

I asked Yergin whether he thought some combination of technological breakthroughs and political developments could bring down greenhouse gas emissions dramatically, which is what scientists say needs to happen to avert climate instability. He replied that regulations such as California's renewable portfolio standard, which requires that 33 percent of the state's energy be provided by renewables by 2020, and the Obama administration's automobile fuel efficiency standards, which require cars to average 54 miles per gallon by 2025, will have a major impact.

But, he said, such regulations are "a second-best answer." A price on carbon would be better, giving a clear signal to consumers and spurring the most cost-efficient low-carbon alternatives.

"Wouldn't the simplest answer be to put a tax on carbon?" Isaacson asked.

"After seeing what happened with cap and trade, I think the answer is yes," Yergin replied.

But, he added, "there's not a big taste right now for raising taxes." Climate could get back on the political agenda if the economy improves.

But climate is a global problem, and even if the U.S. moves to a low-carbon economy, China and India will continue to burn fossil fuels. "Twenty years from now, on a global basis, our energy mix won't look too different than it does today," Yergin said.

If he's right about that, we're all in big trouble.

Fortunately, as the saying goes, predictions are hard ... especially about the future.