Those who’d like to see the United States tap more of its natural gas reserves just hit a yellow “caution” light. It reads “Frack with caution.”

Fracking, or hydraulic fracturing, is a promising technology that injects a mixture of water, sand, and chemicals underground to fracture rock and release shale gas previously thought unretrievable.

If fracking can be done safely, it could be a “game changer,” as one oil industry chief executive said recently – a major source of domestic energy over the next century. Shale gas makes up about 14 percent of the US natural gas supply today but is expected to reach 45 percent by 2035, the US Energy Information Administration says.

But first, serious environmental concerns must be addressed. Earlier this year, a Duke University study of 68 private ground water wells in Pennsylvania and New York state found evidence that shale-gas extraction has caused them to become contaminated with methane.

Now a US Energy Department advisory panel has released another report on fracking. Along with water quality it adds a number of other concerns, including the possibility of air pollution.

Among its key recommendations is a call for transparency regarding the use of chemicals in the extraction process. Drillers say they would like to keep the exact formula of the chemicals they use secret because it represents a competitive advantage.

More than half of US states have some amount of fracking under way. A number of states that are expected to see major fracking operations, including Texas, Colorado, and Pennsylvania, have either instituted or are considering laws requiring chemical disclosure.

Companies that inject chemicals underground should have to disclose exactly what they are doing. And some drillers have begun to comply voluntarily, at least in part. The rest may need a regulatory push.

New Jersey’s legislature has passed a ban on fracking that awaits signature by Republican Gov. Chris Christie to become law.

The panel also recommended that fracking activity be carefully monitored, that local water supplies be watched for changes in quality, and that a system for companies to share “best practices” be employed to ensure safe extraction. Drillers should also abandon the use of diesel fuel in their chemical mix because it contains benzene, a known carcinogen.

The panel was formed by Energy Secretary Steven Chu at the urging of President Obama, with a mandate to take 90 days and give a quick assessment of the challenges. A potentially more comprehensive Environmental Protection Agency study of the effects of fracking on drinking water is expected next year.

It’s clear that more research is needed. One key question: How much “greener” is producing shale gas than mining coal, an acknowledged dirty fuel that gas could replace? Natural gas is a relatively clean-burning fossil fuel, but the environmental cost of extracting and transporting shale gas must be weighed in the balance as well.

Water contamination caused by fracking wells that are poorly designed or built is a fixable problem. But those living near shale oil fields also need assurances that chemicals injected deep underground won’t surface again, not even decades later.

Fracking presents a significant possibility of serious environmental impacts, says the former Central Intelligence Agency chief John Deutch, who headed the Energy Department panel. He adds: “When you realize we may have several thousand such wells drilled in the US over the next 20 years, it’s important to get this right.”

That's for sure. Shale gas represents a bright hope for America’s energy future. But only if its benefits don’t bring along an environmental disaster with them.