The past year has been one of transformational change for the energy sector as the world woke up to the climate emergency.
The UK and Scotland have led countries around the world in setting legally binding net zero carbon targets. At the same time, shifting societal expectations are having a profound impact on how policy makers and companies are tackling the climate emergency.
Energy transition is happening – right here and right now.
But there’s no conflict in maximising economic recovery of the UK’s oil and gas, while maximising the growth of renewables and with that the opportunities in carbon capture usage and storage (CCUS) and hydrogen. To meet growing energy demand and deliver net zero the two must work hand-in-hand.
Here in the North East of Scotland we have more than 50 years of energy expertise to draw on to turn the challenge of climate change into an opportunity and become a global energy transition cluster. But how do we make this ambition a reality?
We begin by reimagining the future of the North Sea.
I believe we can create a different future built on offshore wind; hydrogen production; carbon capture usage and storage; and oil and gas. We can’t afford to look at these components of our future energy mix in isolation; it’s crucial we take an integrated approach, applying our significant capabilities and innovative technologies to reduce carbon emissions.
Offshore wind will be critical. The UK already has more offshore wind installations than any other country in the world and a clear line of sight to a seven-fold increase in capacity over the next decade. In Equinor’s Hywind, the North East of Scotland is home to the first and largest floating offshore wind project in the world. That creates real first mover advantage and huge potential.
It means we can electrify the North Sea, creating an offshore network delivering clean electricity to the grid and using it to power oil and gas facilities and produce ‘green hydrogen’ offshore. In the North of East Scotland, we have the capability and infrastructure to be a hydrogen pioneer.
According to the Committee on Climate Change, the UK must increase CCUS from zero today to 176 million tonnes by 2050. This is a huge challenge but possible with full Government and Local Authority participation including applying their emergency status to their own internal planning and regulation. Projects need to move ahead faster.
At Opportunity North East (ONE) we’re proud to be a founding partner in the North East Carbon Capture Usage and Storage Alliance (NECCUS) and it is excellent to see the Acorn project at St Fergus moving forward. But one or two projects are simply not enough. Government and industry need to back another five projects or more – and quickly.
Through all these activities, we can create a globally active, integrated, all-energy supply chain delivering solutions across the energy mix and driving export growth. It is a very exciting time for energy companies in the North East of Scotland and at ONE we’re determined to help them compete and win.
In partnership with Scottish Enterprise, we’re funding a programme to support the growth of SMEs through diversification, with a major focus on energy transition opportunities. So, far we’ve engaged with almost 1,000 companies and provided one-to-one support for more than 40 businesses.
We’re also working with our regional partners to connect people, companies and universities to create an integrated approach to R&D, innovation and manufacturing that puts the North East of Scotland at the forefront of the energy transition.
It was encouraging to see the Conservative Party’s Manifesto proposing a “Transformational Sector Deal for the oil and gas industry”. This should focus on facilitating and catalysing activities and projects which will help create a net zero offshore energy industry. There are a number of potential projects in the North East of Scotland and we must ensure we get a fair share of the funds available.
Working together, we can demonstrate that the North East of Scotland can quickly become a global energy transition cluster making a significant contribution to the UK’s 2050 net zero target.
