Energy Institute tells majors to ‘own’ emissions
Net-zero target by 2050 is not ambitious enough, IP Week delegates told
President of the Energy Institute Steve Holliday introduced the International Petroleum Week conference by saying it would be “disastrous” if the industry did not take the lead on climate change “for businesses, for the planet, for humanity”.
The temperature in Antarctica reached 20C for the first time ever in history this year and in recent months there has been a wave of climate events from melting ice sheets in Greenland to bushfires in Australia, he notes. “I am very clear… that the science is now beyond any reasonable doubt.”
The necessary response is also clear. “We need to remove greenhouse gases from our energy system as quickly as possible,” Holliday says. “It may even challenge the very relevance and survival of this sector.”
While carbon emissions flatlined last year, according to Energy Institute analysis, the challenge remains “enormous” to “radically” change the energy system. He expects the November COP26 meeting in Glasgow to be about “just how ambitious we can be in constraining carbon”.
“We need to remove greenhouse gases for our energy system as quickly as possible” Holliday, Energy Institute
Holliday warns the industry that the mood among the public has “changed dramatically” in the last year. He says people that routinely describe climate change as a crisis or an emergency are “mainstream”.
He notes that improvements in the quality of life for “billions of people in low and middle-income countries” has brought about a commensurate demand for energy and there is still a long way to go. 800mn people still do not have access to electricity and energy demand is predicted to grow 25pc by 2040.
“We need more, cleaner energy and we need it fast. When I hear all the talk of 2050, I have to say, I worry,” he says. “It is a long way away.”
Such a distant target tempts the industry into the mistaken belief that action can be put off until later, Holliday says. “My own belief is that this decade… is the key. That is what will determine success or failure.”
While acknowledging the role of the industry in climate change he says it must also be part of the solution. “There's a widespread and even misguided view that the oil and gas sector can only ever be the problem. How wrong that is… I am a massive believer in human ingenuity and our ability to solve challenges through technology.”
Over the coming decade “the credibility of the sector” will be tested. To pass this test, “we need to show demonstrable, rapid change… most of all, changing what we do in the products that we sell… We cannot prevaricate… The scrutiny and expectation are going to weigh heavy on our sector and we need to progress in earnest now.”
He says the Energy Institute is no longer just a “long-term companion” of the oil and gas sector but increasingly one to renewables and soon hydrogen, CCS and smart networks. In other words, “the total energy system”.
The coming decade will be bumpy, he warns, “but it will serve no one if we are not open to scrutiny, to honest debate and to change”.
He adds that the oil and gas industry must move from “participating” in dealing with the climate challenge to “owning and leading” it.