OR WAIT null SECS
© 2023 MJH Life Sciences™ and Turbomachinery Magazine. All rights reserved.
The renewable energy push is not just a European phenomenon, but increasingly global.[/caption]
The gap between large U.S. oil companies and their non-American counterparts in the shift to green energy is as wide as ever. Japan announced this week that it will join the European Union by pledging net zero carbon emissions by 2050. No such policy initiatives exist in the U.S., despite growing demand for electric vehicles and solar and wind power continuing its rising market share. Renewables are gaining ground in the energy generation market, according to reports by the International Energy Agency.
France-based Total and the UK’s BP are among those leading the charge in a massive transition towards renewable energy, building brand-new businesses in power generation, energy storage and charging stations. Both have committed to become “carbon net zero” by 2050. For traditional oil giants, this is a radical pivot.
The writing is on the walls for U.S. oil as ExxonMobil announced planned layoffs this week, underscoring faith in fossil fuels. Time will tell if U.S. oil companies decide to enter these markets or cede them to utilities, battery producers, and startups. U.S. oil companies aren’t stuck in 1950 by any means. Their toes are firmly dipped in renewables.
Chevron in May 2019 announced a collaboration with EV charging network operator EVgo to install chargers at select Chevron stations in California. ExxonMobil, meanwhile, is collaborating with academic institutions and other groups to expand technology development in renewable power, biofuels, carbon capture, grid-scale electric storage, long-distance battery storage and hydrogen. ExxonMobil is even targeting the technical capability to produce 10,000 bbl/day of biofuels, including from algae, by 2025.
These companies may need to delve deeper than their toes to meet the growing demand that the rest of the world is beginning to recognize. This would have broader implications for petrochemicals supply and demand. If more oil companies prioritize green energy projects, viewing them as the future growth drivers, there may be less emphasis on building petrochemicals and polymers capacity.
And with less transportation fuel demand, refining capacity could be cut, thereby reducing naphtha feedstock supply as well as aromatics and propylene co-product. Already some traditional refineries are being converted to biorefineries in Europe as well as in the US. In these cases, it’s not just about swapping feedstock. Rather, overall fuels output is significantly reduced.
Total and BP renewables footprint
By 2025, Total expects its global renewable power footprint to be 15GW in Europe, 6GW in India, 3GW each in the US, China and South America, 2GW each in the Middle East and Rest of Asia, and 1GW in Africa.
The company also is playing in the solar distributed generation (DG) space worldwide through joint ventures and equity stakes in solar panel production-and-installation companies.
BP noted that global average costs for solar and offshore wind builds have declined by 90% and 60%, respectively, over the past decade. It expects costs to fall a further 30-40% over the next decade, it said at its BP Week event in mid-September.
Renewables - solar, wind and bio-power - have the potential to become 45% of global power capacity by 2030, it noted.