Why the energy transition will need solutions as well as scenarios to achieve Net Zero

From Colin Elcoate, CEO of Alderley

19th May 2021

Earlier this month, I outlined our vision to make Alderley the Integrated Solutions Provider for the Global Energy Industry and explained our plans to maximise the value and efficiency of our customers’ energy assets from concept to operation to aftermarket service. 

It was heartening to hear from you about the innovation and creativity happening in today’s energy market.  There is a clear focus on digitalisation and the need for a bespoke solutions-led approach to tackling the difficult challenges ahead.

In this piece I highlight the drivers for Alderley’s plans and where we fit in on the path to Net Zero.

At the heart of this lies the energy transition and an energy industry that needs to embed greater efficiencies and sustainability throughout its operations.

IEA Roadmap for Net Zero 2050

This week, the IEA published its Roadmap for achieving Net Zero emissions by 2050

This is a radical departure for the IEA as the Report states that to reach Net Zero by 2050 in a 1.5 degree C pathway then all new oil and gas projects must stop this year.

Key to this Net Zero pathway is the need for an orderly transition across the energy sector where all countries cooperate actively towards achieving Net Zero emissions globally. 

According to the IEA’s Roadmap, all technologies and emissions reductions options are dictated by costs, technology maturity, policy preferences and trade-offs with wider societal goals, as well as market and country conditions.

While not everyone will agree with the scenario’s startling conclusion, the IEA’s approach recognises the need to ensure reliable and affordable fuel and electricity supply, and the need to minimise stranded assets where it makes sense to avoid volatility in energy markets. 

In short, the IEA understands that we need to reduce drastically the amount of carbon we emit but we will only do this through a collaborative, orderly transition. 

This approach resonates with the work that the UK Government has embarked upon through the North Sea Transition Deal, which outlines how the UK can build on its expertise in oil and gas to embrace new sectors like CCUS and hydrogen.  Plans are underway for the North Sea oil and gas sector to reduce emissions by 10% by 2025, 25% by 2027, and 50% by 2030.

This change is clearly coming.

So where do solutions providers like Alderley fit in?

Companies like Alderley, an industry partner for over 30 years, have a pivotal role to play in this transition.

First, the oil and gas industry will only be able to deliver the kind of substantive change that is needed to mitigate emissions and improve efficiencies by using best-in-class bespoke solutions produced to local specifications by local teams. 

To this end, we are heavily investing in localisation and deploying the right skills and knowledge to the right locations such as the Gulf to improve the solutions that we offer our clients.

Second, the low carbon transition will need new, transformative approaches as ‘off-the-shelf’ products simply do not exist. 

Progressive engineering is fundamental to delivering for the global energy industry.

By putting innovation and digitalisation at the heart of its business, Alderley is already looking at how its integrated solutions such as metering and process systems can be used not just to improve oil and gas operations but for the UK’s hydrogen and CCUS sectors. 

Third, as the global energy system is reinventing itself, we are reinventing how we respond to our clients’ needs.

Just as the energy transition is dictating that our clients and partners become more flexible and agile to a changing energy landscape, we must be more responsive to their needs.

Because of this, early last year Alderley launched its global aftermarket service business.  This is all about building strong and lasting relationships with our clients – getting close to them to understand their challenges and working in close collaboration with them to deliver the solutions that drive positive change.

Furthermore, we will soon be launching an exciting digital proposition to augment our aftermarket services and deliver solutions to our clients whenever and wherever they need them. 

Therefore, though the energy transition seems at times to be abstract with scenarios and pathways, it is embedded in everything we do.  Rather than be defensive, we must accept that change is on the way.

I’d be interested to get your thoughts on what I’ve presented above.  Please do not hesitate to get in touch as I’d love to hear from you. 

 Colin

Colin is CEO of Alderley plc and has worked in the energy industry for over 25 years holding senior positions in leading energy firms with global operations.

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