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Sunday, Sep 20th, 2020

Closer energy integration could meet two-thirds of UK’s net 2050 zero target: report

New study by OGA says better co-ordination between offshore oil and gas and renewables could go much of the way to achieving decarbonisation goals

Closer integration of the UK’s offshore energy systems could help meet almost two-thirds of the nation’s target to become carbon neutral by 2050, according to the fndings of a key new report.

A 30% contribution to the UK’s “net zero” goal could be achieved primarily by the deployment of carbon capture and storage (CCS) and CCS-with-hydrogen, according to the study, published on Thursday by the Oil & Gas Authority (OGA).

Adding offshore renewables — such as wind, wave and tidal — to the mix, and combined with investments in onshore energy infrastructure, could increase that to 60%.

The UK government last year became the first G7 country to commit to decarbonising its economy and energy systems by the middle of the decade.

‘Remarkable’

“The results are remarkable. The UK continental shelf has the potential to make a deep and meaningful impact on the UK’s overall net zero target and offshore energy integration can be the game changer,” said Andy Samuel, chief executive of the OGA.

The regulator started early in 2019 in collaboration with electricity regulator Ofgem, The Crown Estate and the Department for Business, Energy & Industrial Strategy (BEIS).

“By closely co-ordinating our energy systems a secure energy supply can continue to be delivered from a diverse mix of production, while unlocking more and more of the green energy and carbon capture needed to help take the UK to net zero,” he added.

For the oil and gas industry, closer energy integration could help reduce production emissions, as well as accelerate the progress of CCS and hydrogen, which Samuel argued are essential for maintaining the sector’s “social licence to operate”.

Opportunities

For offshore renewables, there are “real opportunities” for increased collaboration with the oil and gas industry’s skills and supply chain.

The report also found that closer co-ordination would not only be valuable in terms of energy production and cutting greenhouse gas emissions, it would also make different technologies more affordable.

Among the report’s recommendations are for early energy integration projects to be “accelerated and enabled”, while steps should also be taken to co-ordinate regulatory processes to remove regulatory hurdles.

There are more than 30 energy integration projects already under way across the UKCS, with more than 10 the OGA is actively involved in.

The report also said that oil and gas platform electrification will be essential in cutting the North Sea industry’s emissions in the near term.

Powering oil and gas platforms with electricity generated onshore instead of using traditional gas or diesel-powered platforms can abate operational emissions by 2 million to 3 million tonnes of carbon dioxide per year CO2 per year by 2030, according to the study.

Skills and capabilities

The capabilities and skills of the oil and gas industry, including its supply chain, will meanwhile be crucial to achieving closer energy integration, and could support the expansion of offshore renewables, including floating windpower.

Re-using oil and gas reservoirs and infrastructure can accelerate CCS, with 20 individual CO2 stores to provide a total capacity of more 3 gigatonnes of CO2 by 2050, said the study.

It also stated that blue hydrogen — from methane reforming —has the potential to decarbonise about 30% of the UK’s natural gas supply by 2050.

Green hydrogen — produced through electrolysis from renewable energy — can support the expansion of offshore renewables in the 2030s and beyond.

However, reducing the costs of the electrolysis technology involved is needed to support the faster uptake of this technology.

Scotland’s Energy Minister Paul Wheelhouse said: “The oil and gas sector has a key role to play in supporting a just transition to a future with net zero greenhouse emissions. This report clearly demonstrates that an integrated offshore energy system, including CCUS and use of hydrogen, can help Scotland and the UK meet our greenhouse gas emission reduction requirements.”

The Energy Integration Project began in early 2019 with a £900,000 grant from the Better Regulation Executive’s Regulators’ Pioneer Fund.

Interim findings were published in December 2019.

Since the project began, the UK became the first major economy to set a target of reaching net zero carbon emissions by 2050.

The OGA has also begun work to refresh its core strategy to incorporate this net zero target.

Focus

Trade association Oil & Gas UK said the report “reinforced the focus” of the North Sea industry to work together in developing clean energy systems.

OGUK is also discussing a potentially transformational funding package for the sector with the UK government, which is also likely to set out how the UK’s oil and gas industry will play its part in supporting a green recovery that attracts investment, jobs and supports the supply chain.

Deirdre Michie, chief executive at OGUK, said: “The [report] confirms the huge contribution of this industry to unlocking the UK’s low carbon energy future and whatcan be achieved through collective action.

“With confirmed government, regulatory and industry support, the essential building blocks are in place and the energy transition is now no longer an ambition – but happening in real time.

“We already know the powerful combination of this sector’s skills, capabilities and infrastructure are advancing new technologies on the road to net zero, with some key projects already under way.”

Tristan Chapman, senior vice president of clean energy at Lloyd’s Register (LR), which earlier this year carried out a technical study on behalf of the OGA into options for decarbonising the offshore energy system, said the report was testament to the OGA’s belief in the long-term strategic and economic value of the North Sea.

“Our research for the OGA has demonstrated that platform electrification, via offshore wind farms as well as from shore, and gas-to-wire, which sends electricity from gas platforms to shore, instead of natural gas, offer the best opportunities in the near-term,” said Chapman.

“However, the longer-term vision, and where the real potential lies, is in the mix of blue hydrogen, green hydrogen, and CCS at scale, allowing for the creation of truly integrated hubs providing continuous energy across borders.”

Source: Upstream| This text was excerpted from the media outlet cited on August 6, 2020 and is provided to Noia members for information purposes only. Any opinion expressed therein is neither attributable to nor endorsed by Noia.