There has been quite some discussion in the press this week about the ability of the UK to meet its 2020 renewable energy targets, with a particular focus on the lack of progress in offshore wind. This highlights again the recent announcement by Shell that our main “low carbon” focus will be in the areas of biofuel and carbon capture and storage (CCS) and not in areas such as wind and solar.
That announcement (and our pullout from the London Array offshore wind project last year) resulted in quite a bit of criticism – and a subject I almost always get questioned on when I speak at an event. As you have read in my posts, there is no question that wind and solar will be important in our global energy future, as will nuclear, biofuels and carbon capture and storage. We will need all the energy we can get to meet growing demand. In the energy space, there are in fact only four things the world can do to manage CO2:
- Use nuclear for electricity.
- Use renewable energy (winds, solar, bio, hydro, geotherrmal, wave, tidal).
- Use CCS in conjunction with fossil fuels.
- Use less energy for a given GDP output.
The flip side of this is that society has to do all of them, in very large doses, starting now, not just to manage CO2 but also to deliver sufficient energy at reasonable cost to meet the needs of a growing global economy.
Oil companies are already big players in the global energy market, but they don’t typically sell electricity. They do supply gas and oil to the electricity sector, but their focus is much more on transport and chemical feedstock. Yet there is an expectation by many that oil companies such as Shell should rapidly transition to technologies like wind and solar. But both are outside their core competencies in terms of technology, which means the companies may struggle to add value and compete against others that can bring significant expertise to the table (e.g. Japanese electronics companies in solar).
Yet Shell and others must move forward as the new low CO2 emission economies are created. This then brings us back to areas where the oil industry may be more successful at adding value. Collectively, we are good at geology, drilling, gas handling, gas separation and compression, gas treatment, large scale chemistry and the distribution of flammable liquid and gas products. These are all technologies that sit behind CCS and bio as an energy source – important components in the short list of options we actually have.
In particular, CCS needs gasification (i.e. large scale chemistry that turns the energy feedstock into synthesis gas – carbon monoxide plus hydrogen), gas handling (both carbon dioxide and hydrogen), gas separation, gas compression, geology, drilling and well monitoring. The use of bio matter for energy may also utilise gasification, but also a range of other chemical processes and of course large scale flammable liquid distribution.
Perhaps the irony in all this is that as society moves to a more electricity based low CO2 emissions world, the oil and gas industry could end up, at least in my view, competing with the electricity sector anyway, but I don’t think solar and wind will be the pathway that takes us there. As gasification of coal and other energy feedstocks becomes more commonplace in power generation with CCS, the power companies will find themsleves handling synthesis gas and hydrogen. Synthesis gas can be a primary feedstock for all manner of chemical products, including synthetic transport fuels and hydrogen will almost certainly play a role as an energy carrier somewhere in the economy. The power generators will also be selling electricity directly to transport consumers for their plug-in hybrid cars. But the oil and gas industry won’t be just sitting on its hands whilst this happens (well I hope not). Not only will many of the technologies needed in the power sector come from the oil and gas industry, but the refinery of the future might look very much like a power station, taking in a range of energy feedstocks, gasifying them, using the syngas to produce certain liquid products such as synthetic fuels, storing CO2 underground, producing hydrogen . . . . and generating electricity. Need I say more.
An excellent article, and I agree with almost all of it. particularly that we should stop arguing about which low-carbon option is ‘better’, accept that we need all of them, and get on with implementation. That’s why I’ve set up http://www.climateanswers.info.
On biofuels, they are necessary for aviation and for some shipping, but should be sparingly used due to the global food problem. Surface transport should run on electricity.
When you say that hydrogen will be an “energy carrier”, do you mean for transporting energy, or for electricity storage? Since hydrogen is bulky and quite difficult to transform, I think is should be used for storage to overcome the problem of intermittence, so in enormous hydrogen gasometers, anywhere on the grid. Others’ views welcome. Stephen
Brilliant information!. I am positive that since gas and oil serves as an important natural resources it has increasingly becoming a significant demand in all means for instance in public companies dealing with oil and gas. It has also been continuously the main hub in the society. As what we see in video advertising and oil and gas had been hitting the world market and with the initiative of XchangeTube we will be witnessing the evolution of gas and oil.