The Importance of Greening Technologies
We must stop looking at the energy sector in such stark terms – we need all the greening technologies we can get.
Since the financial crash of 2008, the past 15 years have seen enormous change in the global energy sector – notably the resilience of hydrocarbons and the onward march of renewables.
Global renewables consumption has quadrupled to more than 40 exajoules according to BP’s recent data – a huge amount and the same as the total energy as India uses in a year.
Solar has become the king of low-cost renewables with solar panels now 90% cheaper than over a decade ago, which has led to more than 1 trillion watts of solar on the global grid.
The pace of change is welcome and must continue if we’re to get anywhere near our legally binding commitments of reaching Net Zero by 2050.
It’s encouraging to note that the penetration of renewables will likely continue at greater pace given the positive disruption caused by the US’s Inflation Reduction Act (IRA) where massive subsidies have boosted investor confidence in green technologies such as hydrogen, CCUS, wind and grid infrastructure.
As the IEA’s Executive Director, Fatih Birol, concurred in an FT opinion-article this month, ‘clean energy is moving faster than you think’.
Yet, within this historic energy transition we must recognise the role that oil and gas companies have made in adapting to the new market paradigm.
Without their investment in greening technologies across the board in the energy sector – in hydrogen, carbon capture and storage, solar, wind and even in electric vehicles – we would not have seen the same pace of development in renewables.
Companies like BP and Shell have more than risen to the challenge of the past 15 years by improving efficiencies at every stage of their operations, while investing, often on the quiet, in the energy technologies that are starting to make a positive difference to our lives and to the goal of a Net Zero 2050 economy.
More recently, when the global COVID pandemic hit and a war in mainland Europe started, it’s been the energy industry that has stepped up to the challenge of securing energy across the globe.
Therefore, my message to government and to those stakeholders across society interested in our energy sector, is ‘not to throw the baby out with the bathwater’.
By this I mean, in the rush to a low-carbon future, the UK Government must not undermine the country’s energy industry and world-class supply chain by neglecting our home-grown companies.
If UK Government doesn’t invest and provide funding guarantees and clarity on the market framework, then supply chain work will go abroad and the UK will miss out again on future-proofing its energy industry.
As a starting point, this means recognising that the global energy sector isn’t cast in two tones – the ‘good guys’ doing renewables, and their ‘bad cousins’ doing hydrocarbons.
The picture today is much more nuanced than that.
Many of the positive developments we see in the market today have been led by the same energy companies that we have relied upon to provide us with the energy we needed over the past 40-50 years – a point made in an excellent article written recently by Irina Slav in Oilprice.com.
This means recognising the UK supply chain for its efforts to adapt over the past 15 years too. It’s no mean feat that the supply chain – companies like Alderley, Kelton and SMS – have become nimbler and more resourceful as well as innovative and client-focused.
It’s for these reasons that earlier this year Alderley, together with recruitment specialist Applica, launched a Five Point Plan to focus attention on the elements needed to enable the UK Energy Supply Chain to prosper in 2023 and build towards a Net Zero energy system.
Just like the larger energy companies, we have developed new solutions in low carbon technologies all with a strong digital component and platform. We are working with partners like Cambridge-based Levidian to develop world-leading, clean energy solutions – something unimaginable several years back.
For example, in hydrogen the Alderley Group has worked to develop hydrogen metering and blending systems to help decarbonise the gas distribution networks and ultimately the energy consumed in UK homes. We have been engaged in hydrogen refuelling stations – so crucial to get hydrogen to the right points on the network. And we have developed emissions monitoring and reporting systems – digital solutions essential for the future hydrogen economy.
We have also developed world-leading produced water treatment (PWT) and filtration solutions that go a long way to improve the sustainability not just of oil and gas operations but of many new technologies that are emerging. We believe that we are actively contributing to Net Zero.
Overall, as I look back on the past few years as Alderley’s CEO, I can earnestly say that we have adapted not just to survive but to thrive. We have also continued and will continue to invest in the UK, but we urgently need government to recognise our efforts and those of our industry.
If we get this right, there’s everything to believe that the UK supply chain will become world leaders in the energy transition space delivering unique greening technologies to the world’s leading energy companies as we all build towards Net Zero.
Colin Elcoate is CEO of Alderley and has worked in the global energy sector for 30 years.