The UK offshore energy sector will miss the opportunity to be a global leader in clean energy if it does not invest now in technology innovation to create a net zero North Sea, OGTC and the Offshore Renewable Energy Catapult have warned.
Reimagining a Net Zero North Sea: an integrated energy vision for 2050 highlights the opportunity for the oil and gas and renewable energy sectors to work together to transform the UK’s energy system and help deliver the country’s commitment to the Paris Agreement.
Early investment is essential – up to GBP 416 billion over the next 30 years – to unlock potential value of GBP 125 billion per year for the UK economy and support up to 232,000 jobs. Investment at pace, together with commitment to a net zero North Sea, will accelerate new job opportunities which could mitigate major job losses otherwise expected over the next decade.
Focused investment in technology innovation could also deliver savings of GBP 154 billion by 2050, reducing costs for consumers and delivering affordable clean energy for UK homes and businesses. Being a leader in clean energy skills and technology presents a valuable export opportunity that the UK must seize.
The report outlines three scenarios which have been modelled on the Committee on Climate Change’s Further Ambition scenario. Each sees the UK achieve its net zero goal by 2050, using a combination of energy solutions to meet demand, but delivering greatly differing levels of economic benefits and green jobs.
In the Emerging scenario, renewable energy plays an increasing role, with gas still a significant contributor to the offshore energy mix and a significant requirement for carbon capture and storage (CCS).
In Progressive, an increased share of offshore renewables dominates the electricity market alongside a blue/green hydrogen mix, with a major role for CCS.
Transformational outlines an energy system which is driven by offshore wind and green hydrogen, with oil and gas demand matched by clean domestic supply.
Energy Minister Kwasi Kwarteng MP says, “I welcome this report and its ambitious vision to help transition the North Sea offshore oil and gas sector towards a Net Zero future. Protecting highly skilled jobs in the oil and gas industry is important to our net-zero aspirations, as we need the same skills, businesses and infrastructure to underpin net-zero solutions.”
“That’s why we have committed to supporting the energy transition with a transformational North Sea Transition Deal and I look forward to working alongside industry to deliver on our world-leading target to achieve net zero greenhouse gas emissions by 2050,” Kwarteng adds.
Scotland Energy Minister Paul Wheelhouse says, “I welcome this timely report from OGTC and the Offshore Renewable Energy Catapult as the oil and gas sector reaches a critical period as it moves on from the huge effects COVID-19 and looks to the future. The three scenarios outlined provides us with further intelligence to support and accelerate the development of an updated integrated energy vision, building on our 2017 Scottish Energy Strategy.”
“An integrated offshore energy system – including carbon capture, utilisation and storage and the use of hydrogen – can help Scotland and the UK meet our challenging greenhouse gas emission reduction targets in the timescale necessary for action, while also supporting Europe’s decarbonisation. We recently announced a GBP 62 million Energy Transition Fund to open up opportunities as companies move from oil and gas to low carbon and renewable investments, supporting our energy sector by investing in projects that help us make significant progress on energy transition as we move toward a net zero society by 2045,” he continues.
“The skills, expertise and infrastructure of the oil and gas sector and its supply chain will be vital in unlocking these opportunities and contributing to development of the great potential for offshore wind, floating wind and marine energy deployment in Scotland’s waters,” Wheelhouse says.
Colette Cohen OBE, CEO at OGTC comments, “These detailed scenarios paint a picture of what the UK’s offshore energy system could look like by 2050. None are definitive, but they highlight the need to drive investment and innovation today. There are tremendous opportunities for the UK, but we need strong alignment and urgent action from industry, governments and regulators to realise these benefits.”
Andrew Jamieson, CEO at ORE Catapult says. “The UK leads the world in offshore renewable energy and we now have a very real opportunity to capitalise on this and reshape an economy around green energy. Leveraging the innovation, skills, experience and investment of our oil and gas industry is imperative to seizing this moment, to protect and create thousands of jobs and deliver net zero.”