Ravindra Puranik, an Oil and Gas Analyst at GlobalData, said the leading oil and gas companies are expanding their exposure to renewable energy through increased investments, as international bodies, such as the United Nations, have highlighted the need to mitigate carbon emissions.
Oil and gas companies held little over 1% of the
total installed renewable energy capacity globally in 2022, in a market that is
dominated by traditional power producers.
Renewable power generation across the world is
expected to grow at a compound annual growth rate (CAGR) of 6.9% between 2022
and 2030, while the share of fossil fuels in the global power mix is estimated
to decline over the forecast period.
As a result, oil and gas players have pledged
considerable investments in the renewable energy market to improve their share
in the coming years, says GlobalData, a leading data and analytics company. GlobalData’s thematic report, “
Renewable Energy in Oil &
Gas,” provides an overview of the competitive
positions held by oil and gas players in the renewable energy segment.
It further benchmarks the efforts of major oil and
gas companies, such as
BP,
TotalEnergies,
Shell, and
Equinor, in
the solar, wind, and biopower value chains. It also identifies the various trends influencing
the renewable energy theme and the technologies that have evolved to exploit
the harvested renewable energy.
Ravindra
Puranik, an Oil and Gas Analyst at GlobalData, said the leading
oil and gas companies are expanding their exposure to renewable energy through
increased investments, as international bodies, such as the United Nations,
have highlighted the need to mitigate carbon emissions.
“Going forward, the oil and gas industry will
increase its adoption of zero-carbon sources, with alternatives such as solar
and wind power becoming increasingly popular,” said Puranik in a statement.
Solar and wind energy have been the primary markets
in the shift to renewable energy, as these technologies have promising growth
potential.
Oil and gas companies are also increasing their exposure to the
emerging biopower segment. Puranik
observes that oil and gas leaders are increasingly positioning
themselves as providers of renewable power and renewable fuels.
“Solar and wind power projects have comparatively
higher growth potential and are also witnessing falling project costs. This
makes them ideal investments for oil and gas companies in their energy
transition,” he said
Currently, oil and gas players are significantly
behind the curve with respect to traditional power players, such as China Three
Gorges, Eletrobras, Enel, Huaneng Group, and Iberdrola. Nevertheless, they are
expected to gain a sizable foothold in this decade.
Puranik says in 2022, Shell did not even
feature in the top 50 renewable energy producers globally but later it
announced several wind and solar projects that would increase its renewable
capacity to 34 GW by 2030.
“This growth would propel Shell into the top 25 in
terms of renewable energy capacity by 2030. The rankings of TotalEnergies and
BP are also expected to take a huge leap over this timeframe,” he said
Uganda is about to reap from some of the efforts by French Energy's TotalEnergies plan o invest in the renewable sector too. In November 2022, TotalEnergies EP Uganda signed a Solar project agreement with the Government of Uganda through the Ministry of Energy and Mineral Development for the possible deployment of 120 MW of Solar Photovoltaic (PV) technology.
The agreement aims at actualizing the collaboration between TotalEnergies EP Uganda and the Ministry towards ensuring energy security and energy transition in the country.
Philippe Groueix, General Manager TotalEnergies EP Uganda said, “In line with our Global multi-energy strategy and commitment to developing 1GW of renewable energy in Uganda by 2030.
At a global level, TotalEnergies reported three days ago that its investments in renewables and electricity accounted for 25% of
total investments, which was more than the 20% it forecast a year ago. "Combined with our investments in new molecules, this means that soon
more than 30% of our investments will be devoted to decarbonized energy.
In the past four years, the Company's gross installed capacity for
renewable power grew from 0.7 GW in 2017 to more than 10 GW in 2021," it reported.
It said its objective is to have 35 GW of gross capacity in 2025 and 100 GW in
2030. The 2025 figure is based on identified projects in development. ”The goal is to reach 35 GW of gross capacity in
2025, then 100 GW in 2030, and thus increase our electricity production from 21
TWh in 2021 to 120 TWh in 2030."
