Jean-Pascal Tricoire, CEO of the French energy management and automation multinational, believes digitising internal systems and processes can help companies reduce energy consumption.

He was speaking during a virtual roundtable discussion with another tech leader, who also claimed the rollout of Industry 4.0 has been accelerated in the oil and gas sector due to falling demand for fuel.

Tricoire said: “When we speak about sustainability, it’s about measuring things that can have an impact on costs, carbon footprint and circularity.

“Digitalisation is traversing everything we do. At Schneider Electric, we’ve been on that trajectory for the past 20 years.

“We’re on the sixth plan and every time we find something new. Every three years, we’ve reduced our carbon footprint by 10%.

“We aim to be carbon-neutral by 2030. Having the ability to measure is the backbone for everything.

“It helps to reduce energy consumption, which is important because we expect sustainability to increase in importance.

“The expectation is a society that’s been shaken by the virus will be even more aware of dangers to life going forward.”

How oil and gas sector is using big data to improve sustainability

The energy industry in particular has been affected by Covid-19 lockdown travel restrictions.

BloombergNEF pointed out in a report earlier this month that road transport consumed more than 40% of all oil demand in 2019.

But as the use of cars and public transport has nosedived, it is predicted more oil demand will be erased in 2020 than the shipping sector consumed in all of 2019, wiping out a decade’s worth of growth.

Craig Hayman, CEO of UK-based industrial software company AVEVA, believes many energy suppliers are now looking to digitise their industrial processes in order to find efficiencies that will help cut costs associated with energy production.

He said: “In oil and gas, you have fuel and energy. Fuel consumption dropped dramatically as people stopped driving cars and getting on planes, but energy consumption has remained relatively stable.

“In fact, electricity is the most efficient way to distribute energy around the world, so we’ve seen an acceleration of Industry 4.0 as it relates to the distribution of energy.”

ADNOC’s $1bn savings point the way forward for energy industry’s use of data

One company leading the way in this respect is the Abu Dhabi National Oil Company (ADNOC), which used AVEVA’s technology to predict failures in its systems before they happen and driving even more production from the rich oil supply at its disposal.

Optimising every aspect of the business has enabled the state-owned firm to generate about $1bn of annual savings and cut carbon emissions, it has previously claimed.

Hayman said: “It already had the data in plain sight in the organisation, and just needed the software to unlock it.

“Most companies have so much data already and have been staring at it for the past couple of years. But it’s been stored in disparate systems, so the trick is to snap rapidly into that environment.

“You can’t replace everything overnight but you can put it into the hands of the person managing a facility and then they can start looking at what they can do with it.”

But he was keen to stress this is just an early example in a long-term process for various industrial sectors – although one that could be accelerated by the Covid-19 pandemic as cost savings take precedence.

“We’ve seen through the reaction to Covid-19 that the world has learned in 90 days what it needs to do with digitisation, although there’s still a lot more to learn,” he said.

Tricoire added: “Let’s look at this period as quite exceptional. I don’t think the fundamentals have changed – the crisis has just forced us to be faster, have less resistance and be bolder in the transformation we already realised was coming.”

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The Costa Rican diplomat, a former executive secretary of the UN Framework Convention on Climate Change (UNFCCC), believes the unpredictable prices of oil, gas and coal mean investors are now favouring power sources like solar and wind.

She called for policymakers and business leaders to think long term when assessing how to restart economies in a sustainable fashion once the pandemic subsides.

Speaking to NS Media Group’s energy editor-in-chief Philippa Nuttall Jones at the New Statesman conference titled Remaking the world after coronavirus: A global policy forum, she referenced an International Energy Agency (IEA) report that said renewable energy has been most resilient power source during the Covid-19 crisis.

It forecast global capacity to increase by 6% this year, although its growth for 2020 and 2021 combined is expected to be 10% lower than predicted before the pandemic due to financial challenges, supply chain disruption and lockdown measures.

“The fact is, even before Covid-19 we’ve seen a constant decline in demand for oil and gas,” she said.

“We’re seeing an increase in demand as a trajectory for renewable energy because of several reasons.

“It’s an entirely predictable cost of fuel – that’s a big fat zero because when did the sun or wind ever send us bills for using their fuels? Prices will only continue to decrease, which we could never say for fossil fuels.

“Fossil fuels have predictable costs for the extraction but not predictable prices on the market.

“We’ve experienced, and been victims of, the constant utilising and eternal unpredictability of the fossil fuels on the market.”

Christiana Figueres says investors increasingly see renewable energy as a safe bet

The share of renewables in global electricity generation jumped from 26% to 28% between the first quarters of 2019 and 2020, according to the IEA’s Global Energy Review 2020.

While coal and gas represent close to 60%, their dominance in the mix has gradually receded, with global coal demand falling by 8% and natural gas consumption dropping by 3% in the same period.

Exploring the perception of investors, Figueres said the decreasing public tolerance of hydrocarbons from a social and environmental standpoint – along with the increased reliability of renewables – had left fossil fuels as “stranded assets”.

“It means most of the fresh financing is going into renewables,” she added.

“A quarter of the global electricity matrix is already renewable and it could be 50% by 2030 – or even more because of Covid-19.

“That growth is something fossil fuels just can’t compete with. We’re seeing the slow but steady decline of fossil fuels on the market and on the grids, and the steady but exponential increase of renewables on the grid.

“In order to increase that, it definitely needs grid optimisation via an overlap of AI and digitalisation in electricity structures, but all that is already happening.

“It also needs a huge amount of investment into batteries, which have come down in cost because of the investments.”

Covid-19 presents an opportunity – but green economic recovery plans are required

Despite continued progress, the UN diplomat was keen to point out the energy industry was still far away from achieving decarbonisation.

Instead, she believes Covid-19 could offer an “opportunity” for the world to tackle climate change by implementing green recovery plans – including new green energy jobs and more investment in national train networks like an American version of the Japanese bullet train – when restarting economies brought to a standstill by lockdown measures.

She highlighted how the 8% reduction in carbon emissions that has been forecast for 2020 by the IEA – brought about during very unusual times – is still only just above the 7.6% cuts required every year until 2030, as recommended by the UN Environment Programme in order to stay under the 1.5C ceiling on temperature rises that scientists say is necessary to avoid disastrous consequences.

Reflecting on more IEA research that suggested a 13% decline in renewable power capacity growth for 2020, Figueres said: “It doesn’t mean we’re on the other shore yet. We’re definitely in an energy transition but all transitions are messy.

“When I provide these statistics about the growth of renewables, someone else could show me figures that say we’re still reliant on coal, oil and gas.

“Both are true because we’re in that intersection that’s typical of any transition, where the old goes down and the new is coming up.

“What we’ve learned from Covid-19 is we totally have to accelerate anything that gives us better resilience and health, not less.”

Asked what her one message for business leaders and policymakers would be, she replied: “Think long term. Yes we have to get the jobs back and get the wheels of the economy moving forward, but at the same time we need to think long term.

“Where do we have to be five and 10 years from now? That long-term thinking will inevitably lead you to sustainability and the right choices today.”

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There were more than 1,300 deep mines in the 1950s but since the last colliery closed in 2015, scientists have studied whether the water – warmed via geothermal processes – that has flooded them could be pumped to the surface for heating homes and other buildings in communities.

Several schemes aiming to do just this are now coming to fruition as part of low-carbon ambitions for housing developments.

In 2018, the Coal Authority said there could be more than two million gigawatt-hours (GWh) of low-carbon heat in the UK’s mines – enough to heat 180 million homes.

And with an estimated nine million homes – a quarter of the UK – estimated to be sitting on coalfields, the legacy of an industry that powered the British economy for more than a century, there are high hopes for using it as a new resource that will go to great lengths in decarbonising heat.

How do abandoned mines product heat?

Mine heat is a renewable energy source that is constantly replenished from the earth’s geothermal processes.

The British Geological Survey says energy companies can tap into huge amounts of water that has flooded shafts and tunnels in abandoned pits.

It says: “Heat pumps, which work in much the same way as fridges, can be used to ‘concentrate’ heat energy from lower temperature waters in the mines to make water hot enough to heat buildings.

“The heat can then be removed and used to warm houses and offices.”

Mine water energy projects in the UK

South Seaham Garden Village

Some 1,500 homes being built at South Seaham Garden Village, in County Durham, will be heated by low-carbon energy produced in the coal mines on which they sit.

The development, which will consist of 50% affordable homes, is planned for construction next to the Dawdon Colliery, which was open from 1907 to 1991.

At its 1925 peak, 3,892 workers produced more than a million tonnes of coal annually in the pit.

The nearby “Blast Beach” – a former waste coal dumping site – was used in the opening scenes of the 1992 film Alien 3, but the area could soon be known for hosting the UK’s first large-scale mine energy district heating scheme.

If the February 2020-announced project is given the go-ahead upon completion of surveying work, it will pump geothermally-heated water extracted from the abandoned flooded mine network into the new community’s heat network.

The water is already treated using technology that’s capable of pumping 100 to 150 litres of mine water per second to the surface in order to prevent it from contaminating drinking water, and geothermal processes mean it can provide a continuous supply of water at between 18C and 20C regardless of seasonal variations.

The Coal Authority – which is collaborating with Tolent Construction and Durham County Council – says this could create six megawatts (MW) of low-cost, low-carbon sustainable energy that may be cheaper than conventional gas supplies.

Gateshead district energy scheme

Gateshead Energy Company, which operates the Tyneside town’s district energy scheme, will install 5.5km of new pipes supplying an extra 12 gigawatt-hours (GWh) of heat to a selection of properties to the east of Gateshead by 2030 after receiving public funding.

The £5.9m grant to the energy company’s owner Gateshead Council, confirmed in May 2020, will enable the new project, which aims to heat up to 1,250 new private homes, a care home, Gateshead International Stadium and other council-owned buildings in nearby Felling.

A 6MW mine water source heat pump will be installed to provide geothermal heat, displacing gas boiler-generated heat.

It also means the company can reduce its reliance on a 4MW gas-fired combined heat and power plant for generating heat by reducing its operating hours.

The council’s member with responsibility for energy John McElroy said the project would exploit an “abundant untapped heat source”.

“There must be hundreds of miles of abandoned mine workings beneath Gateshead and many of them are flooded providing access to a sustainable source of heat, so there is huge scope for more initiatives like this,” he added.

Caerau Colliery, Bridgend

Water heated by the earth to about 20.6C will be pumped from a depth of 230m to heat homes in Bridgend, Wales.

The largely publicly-funded £9.7m scheme will extract the water from the former Caerau colliery, which operated from 1889 to 1979.

About 2,000 people worked in the steam coal pit and another 340 worked at the house coal pit in 1923.

The renewable energy project will pump water through a heat exchanger unit, a device the size of a fridge that is fitted in people’s homes, and a heat pump that warms the water used in central heating.

It is then pumped back underground so it can heat back up and be recycled.

Before the coronavirus pandemic, construction work was expected to begin in 2020 with the first 150 homes being heated by winter 2021.

There are hopes it could eventually heat 1,000 homes and help cut energy bills in what is claimed to be Wales’ fifth most deprived ward.

It’s estimated the average household could save £100 a year, while the integration of solar PVs and energy storage could reduce grid electricity also used for heating.

Glasgow mine workings scheme

The British Geological Survey (BGS) is working alongside Glasgow City Council to explore potential heat within mine water, superficial deposits and bedrock aquifers lying beneath the Scottish city.

Its studies will look into using lukewarm water at 12C that naturally flooded a deep coal mine to warm homes and buildings, helping Glasgow to ensure 11% of heat demand comes from renewable sources by the end of this year.

But the BGS actually believes its studies to date suggest 40% of the city’s heat could be provided in this way.

“Glasgow’s miners may have left an invaluable inheritance – a renewable and very green way of heating, and even cooling, the city,” it says.

“During summer, when buildings like hospitals need to be kept cool, the system can be reversed; the excess heat is stored underground for use in the winter.”

The ongoing £9m study – part of the government-backed £31m UK Geoenergy Observatories Project to develop new sustainable energy technologies – builds on a small scheme in east Glasgow’s Shettleston district, where 17 houses have been warmed by mine water for 10 years.

Scientists have drilled 12 boreholes to varying depths in Rutherglen’s Cuningar Loop – the site of the former Farme Colliery, which closed in 1921 – and Dalmarnock Colliery to investigate the potential of the trapped mine water.

Measurements such as temperature, water movement and water chemistry have been collected. Changes over time will be monitored and the data will help the researchers understand how much of the disused network of mines stretching from Glasgow to Lanarkshire remain interconnected.

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From the Buick 1956 to the Chevrolet 1957, a journey down the streets of Havana is like a step inside a time capsule back to the mid-20th century.

But while this vintage feel is one of the main draws for tourists to Cuba, its brightly-coloured classic American cars that pre-date catalytic converters produce a huge amount of black smoke, making air pollution a real problem for the Caribbean country.

The World Health Organisation says the concentration of particulate matter, the most common air pollutant that affects short and long-term health, is twice the recommended level.

Cuba has been left in this position by 50-plus years of US trade embargoes that have made sourcing replacement parts affordably nigh-on impossible. But across the Atlantic in Britain, a different type of political tension – between rural and urban priorities – could be responsible for leaving behind its countryside communities.

The UK government has written into law that new sales of petrol and diesel vehicles will be banned from 2035. To get the country ready for a transition to fully electric vehicles, it has issued plug-in grants, told housebuilders to equip new-builds with chargers and begun installing chargepoints in car parks and busy streets.

But in rural areas – where about a fifth of the population live – little progress has been made.

“Clearly, people in rural areas rely more on individual cars than public transport,” says Eugene Lambert, a Tesla Roadster and Nissan Leaf driver who lives in north-west England’s Lake District National Park.

“Setting a deadline for banning sales of new ICE (internal combustion engine) cars will therefore have a disproportionate effect on rural areas, unless appropriate action is taken to facilitate the transition to EVs.

“Yes, EV range will go up over that period, and EV prices will come down, but the absence of a well-planned and extensive public charging infrastructure with reasonable tariffs could discourage many from making the jump to EVs.

“This could lead to a ‘Cuba effect’, with rural areas full of older hideously polluting ICE vehicles – hardly appropriate for a national park.”

Lambert is no stranger to rural life having been a resident of the Cotswolds for more than 15 years before relocating to Applethwaite, a hamlet just outside Keswick, Cumbria, in 2019.

The 56-year-old writer is one of hundreds to put their money where their mouth is when it comes to campaigning for rural EV charging infrastructure by investing in a community share offer run by Charge My Street.

The social enterprise is using the scheme to raise money for installing chargepoints in largely remote locations where there is little chance of receiving local authority or commercial intervention.

Director and company secretary Daniel Heery says: “When we’ve done surveys of people in rural areas, the lack of infrastructure is the main barrier to adoption so if we can take that barrier away, it opens up the potential to make that switch.

“For us, it’s not just about raising investment but raising awareness too so we can start challenging people’s thoughts about EVs and get them thinking about this infrastructure in terms of what’s happening where they live.”

What is Charge My Street and how was it formed?

Heery got involved with the project after moving from rural Cumbria to Lancaster, a small city in north-west England, in 2017 and having to replace his petrol car.

The UK has 18,300 publicly-available EV charging devices across 11,400 locations – equipped with just under 32,000 connectors, according to Zap-Map. The vast majority of these are in major cities, with Greater London accounting for a quarter of them.

“In rural areas, fuel costs are an enormous part of people’s living expenses and potentially, with EVs, you can save money,” says Heery.

“We wanted to get an electric car but there was nowhere to charge it and the council had no plans to install charging points.”

Realising a few friends were in a similar situation, he set up Charge My Street as a social enterprise.

Run along the same lines as his other business interest Cybermoor – a co-operative based in Alston, Cumbria, that has helped to improve rural internet connectivity since 2002 – it installs and operates EV chargepoints for communities where public and private investment in such infrastructure is scarce.

Heery can see similarities between the problems encountered with broadband and EV charging in rural areas.

While 95% of UK premises have access to superfast broadband connections, according to Ofcom, the figure fell to 77% in rural areas as of May 2019 – with one in 10 rural properties unable to achieve speeds of at least 10 megabits per second (Mbps).

“The issues are quite similar,” says Heery. “Commercial providers prefer to target areas where they will get the greatest return on their investment so they often won’t bother coming to rural areas.

“And if you’re in a village or town with a lot of terraced houses and no driveway, there’s not going to be many people buying EVs.

“It’s a chicken or egg situation so you need someone to step in and break that cycle.”

Charge My Street began by installing two chargepoints in Lancaster, as well as one in Alston – which was also the location of a government testbed project for showcasing the benefits of 5G in rural areas – and one in Broughton-in-Furness, a small market town on the south-western edge of the Lake District.

This was in 2018 and they were fitted in the car parks of community centres, village shops and pubs. Users require a paid-for app to charge anywhere on the network.

Councils, which own public assets such as lampposts, pavements and roads that can be adapted to accommodate the fast chargers, were engaged with along the way.

“We can see we’re getting pretty good usage out of the urban devices and the rural ones are being used predominantly by tourists at the moment, but we’re trying to get local people to switch to EVs,” says Heery.

“It’s still at a relatively early stage and in rural areas, people are culturally less keen to make that switch, even though the finances are more promising in some respects.

“But as new technology emerges, we think that transition will happen.”

How Charge My Street is funded – and its expansion plans

Community share offers are nothing new in the energy industry. Listed on the Community Energy England website are several projects that allow the public to invest in clean energy projects for installing solar panels on buildings or in fields, equipping street lights with LED bulbs and building hydro plants.

Charge My Street is one of the latest projects promoted by Community Energy England. Its community share offer – the second such scheme after a previous one that raised £20,000 led to the initial four chargepoints being installed – ran from 20 April to 26 May this year.

People could invest a minimum of £100 and were offered a 2% interest return from 2023, rising to 5% from 2025. They can also benefit from a 50% seed enterprise investment scheme tax relief.

Despite the Covid-19 lockdown and subsequent economic troubles it caused, the scheme succeeded in hitting its £130,000 target figure for installing at least 100 chargers, which typically cost around the £10,000 mark.

It also gave the group an indication of where demand lies geographically, with interest from Carlisle, County Durham, Lancaster and the South Lakeland district in Cumbria.

Heery says: “We don’t want people to just say ‘yes put one in and we may get an EV at some point’.

“We’re not asking for thousands of pounds but we want to see some real local demand by people putting their money where their mouth is so we know a community is interested and thinking about how it can go on this low-carbon journey.

“It’s an attractive offer for people who want to see a growth in the charging network, buy an EV, want to help tackle climate change or purely just for earning some money on an investment.”

Interested locations were split roughly 50-50 between rural and relatively urban areas, with decisions made according to a set of criteria including the strength of mobile connectivity, electricity supplies and practicalities of installing charging points.

Charge My Street is part of a broader project called Scaling On-Street Charging Infrastructure (SOSCI). It aims to install 200 fast chargers with a 22-kilowatt (kW) power rating for community use across the north of England by Easter 2021.

This scheme has been backed with more than £3m in funding from Innovate UK as part of an electric charging for public spaces infrastructure competition.

Charge My Street was awarded £335,000, with other partners in the consortium to receive grants including Vattenfall’s electric vehicle business – now part of Statkraft – logistics software company Miralis Data, EV charging manufacturer EO Charging, and various councils and charities.

Why off-street charging infrastructure is vital to mass EV charging uptake

Alongside the high initial costs involved in swapping combustion engines for electric power, “range anxiety” provides another barrier to EV uptake.

Data from the European Alternative Fuels Observatory shows the number of EV chargepoints per 100km of road in the UK increased from 42 in 2011 to 570 in 2019 – with more than 10,000 publicly-accessible chargers now installed.

The government accepts this needs to increase further and has committed £400m ($521m) to help private operators install more devices across the country, as well as introducing legislation last year ruling that all new-build homes should have EV chargers.

But debate has raged over whether domestic or public chargepoints should be prioritised, with the government-backed Electric Vehicle Energy Taskforce releasing a report in January this year saying both are equally important to enabling the electrification of road transport.

Speaking at the time, SMMT (Society of Motor Manufacturers and Traders) senior technology and innovation manager David Wong said 80% of EV drivers charge their vehicles at home because it’s the most convenient method but 93% still use public chargers.

Fellow taskforce member Jillian Anable, a University of Leeds professor specialising in energy and transport, called for more innovation in off-street charging infrastructure to build on ideas like chargers being plugged into lamp posts, pop-up devices in pavements and telecoms street cabinets.

“We need to get a grip on that,” she said. “Even homes with a driveway might only have space for one car but the household could have two cars, so what are they going to do – get up in the middle of the night to swap the cars over?

“We need to think more about residential on-street parking and I think we’ll see different solutions coming through.”

Heery shares Prof Anable’s view that not enough focus has yet been given to the on-street charging space.

“There’s a lot of investment going into rapid chargers at supermarkets and homes, but not much is happening for those vehicles parked on-street,” he says.

“Nationally, 40% of vehicle owners don’t have a drive. In order to get those people, who might want an EV, to actually buy one, you have to really focus on the technology to support them.

“Some projects are looking at smart charging, where you plug in the vehicle at 9pm but it doesn’t start charging until after midnight when prices are cheaper.

“In the off-street space, when we have village halls with solar panels on the roofs, how can we get people to use those assets and charge for cheaper on sunny days?

“Some people say we don’t have enough electricity supplies for EVs but we can manage that if we manage our charging to fit around the network.”

The ultimate vision of SOSCI is for eight million homes without off-street parking in northern England to be within five minutes’ walk of an EV charger.

This is a distance that 75% of people would be happy with, according to the consortium’s research.

Another EV Energy Taskforce member Jonathan Murray cites the inroads made by Shell and BP Chargemaster in the EV charging market as evidence attention is being turned towards a “ubiquitous, reliable supply in a local network that services the customer wherever they are”.

But Murray, policy and operations director at the Low Carbon Vehicle Partnership, a UK public-private partnership that develops initiatives to promote the shift towards zero-emission road transport, admits he doesn’t want to see a replication of the situation with broadband in which there is a clear gap between urban and rural areas.

“It’s important to have consumer confidence, which comes in various guises,” he says. “People talk about things like range anxiety and the driver needs to know they can use their EV in a way they want to and at an acceptable price for charging.

“The infrastructure is going to be expensive so we need to reinforce the grid, deploy innovations like smart charging and understand where the demand is coming from.

“But these principles apply across the whole country – we don’t want to see holes in the network and we need to ensure there’s a provision in both urban and rural areas, as well as on-street and off-street.

“At the same time, can we rely solely on the commercial sector to roll out what we need? Probably not. It needs a mixture of public and private finance to get that out there.

“I don’t think there’s the innovation available for the roll-out to happen at the moment but there’s an appetite for bringing the right people together to do so.”

What people in rural areas think about electric vehicle charging infrastructure

It wasn’t a drive through Old Havana that woke up Lake District resident Lambert to the benefits of zero-emission transport, but during a visit to California.

This was in 2011, when he had previously considered reports about EVs in development to be “vapourware” until he saw the Tesla Roadster supercar – its latest model is now said to be the world’s quickest car – scream past.

He bought a right-hand drive version and sold his fossil fuel-powered Porsche Cayman S when he returned home.

“I’d become aware of climate change and was getting uncomfortable driving around in a petrol car,” he recalls.

“The Roadster EV let me ‘have my cake and eat it’, as it were. A fun sports car, with incredible performance and zero emissions.”

Home worker Lambert and his wife Jana, 48, now use their two ultra-low emission vehicles (ULEVs) for leisure driving around the Lake District and occasionally travelling across the UK – even taking it to the Czech Republic, via Slovenia, and back once.

The couple admit to being impressed by how easy and relaxing it is to drive an EV due to the addition of regenerative braking and lack of a gearbox, while they estimate 10,000 miles a year will cost them £125 in electric power rather than about £2,000 in petrol according to prices before the oil price crash.

Although many people living in rural areas benefit from having a driveway to charge their vehicle off-street, Lambert believes the lack of infrastructure has as much of a psychological impact as practical – as well as potentially impacting on the future tourism offer.

He adds: “A more extensive charging infrastructure would doubtless help EV beginners, of course.

“An extensive network of more affordable ‘destination chargers’ that are 7kW would provide a means to charge EVs for those people without home chargers, as well as addressing range anxiety for less experienced EV drivers.

“It would also encourage EV-driving tourists from outside the rural area to visit – and part with their tourist cash.”

Robert Alexander Sykes can manage his 78-mile round trip to work on a single charge, but if he needs to travel any further then he could find himself in trouble.

The 58-year-old solicitor, who lives with his partner in the small market town Penrith, in Cumbria, says: “On the A66 between Penrith and Scotch Corner, a distance of 50 miles, there is one public charge point at Kirkby Stephen – and this is very poorly maintained and often not working.

“Penrith itself is poor – there are two points at [visitor attraction] the Rheged Centre but none in any of the supermarkets, for example.”

Having always lived rurally, Sykes struggles to keep annual travel under 20,000 miles in his Renault Zoe EV and the keen sea kayaker adds several thousands more miles each year in a diesel Skoda Octavia estate car for longer trips and the extra roof space for carrying his vessel.

“For those without off-street parking, reliable access to overnight charging becomes essential – relying solely on faster chargers at service areas is just a pain,” he adds.

“Charge My Street’s scheme would resolve that issue to a significant extent.”

It’s a start, but if rural areas are going to have easy access to electric vehicle charging, it will take a wider effort to build the infrastructure required.

The post Why it’s important to consider rural areas when developing electric vehicle charging infrastructure appeared first on NS Energy.

The disaster happened when an Exxon Shipping Company oil tanker crashed into the Prince William Sound Bligh Reef, just off the coast of Alaska, and spilled almost 11 million gallons of crude oil.

It was the worst spill in US history until the Deepwater Horizon incident in 2010 in terms of volume but is considered the worst globally when assessing the environmental damage.

The Exxon Valdez oil spill has been cited for “changing the oil industry forever” by making tankers safer and introducing new legislation that placed more responsibility on oil companies.

The incident was brought back into public consciousness this week after it was compared to the Norilsk oil spill, when 20,000 tonnes of diesel leaked from a power plant in the Siberian city into a river within the Arctic Circle on 29 May – leading to a state of emergency being declared by Russia.

Here, we take a look back at how the 1989 Exxon Valdez oil spill unfolded and its repercussions on the energy industry.

How did the Exxon Valdez oil spill happen?

Just after midnight on 24 March 1989, the Exxon Valdez tanker – which had left the port of Valdez, Alaska, bound for Long Beach, California, hours earlier loaded with 53 million gallons of Prudhoe Bay crude oil – struck the Bligh Reef.

The collision tore open the ship’s hull, releasing 10.8 million gallons of oil into the Prince William Sound within the Gulf of Alaska.

Within days, the oil had spread 1,300 miles along the coast, causing huge environmental and wildlife damage.

The final wildlife death toll, according to National Geographic, included 250,000 seabirds, almost 3,000 sea otters, 300 harbour seals, 250 bald eagles, 22 killer whales and billions of salmon eggs.

“Populations of pacific herring, a cornerstone of the local fishing industry, collapsed, the magazine reported in April 2019. “Fishermen went bankrupt.”

The financial loss from recreational fishing was estimated at $580m, while it cost the Alaska tourism economy $2.4bn and affected 26,000 jobs as the number of visitors hit a record low for almost a year.

The reef was a well-known navigational hazard but an accident investigation found its commander Captain Joseph Hazelwood was not at the helm of the tanker – it was later found he was asleep in his room – when the accident happened, while the Third Mate failed to manoeuvre the vessel away from the reef properly due to a broken radar.

It discovered the radar had not been working for a year prior and Exxon had not installed iceberg monitoring equipment. The Third Mate was also not qualified to take control of the ship, which was also under-staffed.

In March 1990, Hazelwood was acquitted at trial of felony charges for being intoxicated but convicted of a single misdemeanour negligence charged – resulting in a $50,000 fine and 1,000 hours of community service.

Cleaning up the oil spill

It was several days before the clean-up operation got underway and it was reportedly this delay that made the accident so catastrophic as efforts to contain the oil slick became impossible as it spread to more areas.

More than 11,000 Alaska residents joined Exxon employees and federal responders to aid the clean-up, which took about three years and involved complex operations such as temporarily relocating marine life. Some 1,400 vessels and 58 aircraft were also used

This cost Exxon about £2bn, while its bill for restoring habitats and compensating for personal damages totalled another $1.8bn. It also agreed to pay the State of Alaska and the US government $900m over a 10-year period in a civil settlement signed in October 1991.

In an online profile of the episode, the US Environmental Protection Agency (EPA) says: “Many factors complicated the clean-up efforts following the spill.

“The size of the spill and its remote location, accessible only by helicopter and boat, made government and industry efforts difficult and tested existing plans for dealing with such an event.”

Clean-up workers skimmed oil from the water’s surface, helicopters sprayed oil dispersant chemicals and beaches covered in oil were washed with hot water.

According to History.com, later studies found that aggressive washing with high-pressure, hot water hoses removed oil effectively but created more ecological damage by killing the remaining plants and animals.

Experts have said it is impossible to fully clean up an oil spill in the ocean and local populations of some marine species like killer whales and seabirds in the Prince William Sound had still not recovered three decades later.

Geological surveys also discovered oil remains buried just a few inches below sand and gravel and will likely remain present for decades.

Marine Insight predicts about 20 acres of the Alaskan coastline remains polluted by sub-surface oil, which it says contains poisonous content that could harm marine creatures, flora and fauna if released.

What was the long-term impact on the oil sector?

The biggest immediate result of the Exxon Valdez oil spill in legislative terms was the passage of the Oil Pollution Act 1990, which increased penalties for companies responsible for oil spills.

It also required oil tankers in US waters to have a double hull, making it less likely to spill oil in a collision like the single-hulled Exxon ship. The EU followed this lead by outlawing single-hull tankers in 2002.

Today, all the world’s fleet of 12,000 to 14,000 tankers used for transporting oil, chemicals and LNG are said to be double-hulled.

Another clause of the 1990 act prohibited any vessel that caused an oil spill of more than one million gallons after 22 March 1989 from operating in Prince William Sound – a key strategic route.

Analysis by the ITOPF, an association of ship owners that responds to oil spills, found that incidents in which more than seven tonnes of oil has been leaked by tankers have fallen from 79 spills per year in the 1970s to six per year in the 2010s, while large spills greater than 700 tonnes dropped from 24.5 to two annually.

It cited tougher regulations and better navigation equipment for the performance improvements, but increased offshore oil drilling has created new risks for leaks.

“Marine oil spill containment and recovery technology improved tremendously after the Valdez, but not much has changed for at least the last decade,” National Geographic wrote in 2019.

“Spills can be located faster and their movements modelled more accurately, but full containment and clean-up remains impossible.”

The post How the 1989 Exxon Valdez oil spill unfolded and its impact on the energy industry appeared first on NS Energy.

On 8 March, Saudi Arabia shocked the world when it launched a price war against former ally Russia to trigger a historic collapse in the price of oil.

Five weeks later, on 14 April, the UK’s business registrar Companies House published financial documents that revealed British financier Amanda Staveley had made a breakthrough in a bid to buy Premier League football club Newcastle United.

These two events may appear unrelated at first, until the finer details of the mooted £300m takeover show that Saudi Arabia’s Public Investment Fund will take a reported 80% stake in the club.

Should the move go through — which it’s expected to, pending Premier League checks, despite mounting opposition from across the board citing human rights abuses, state-sanctioned murder accusations and broadcasting piracy — it perhaps comes at a highly significant time for the Kingdom.

The coronavirus pandemic, which has transformed societies by instigating worldwide lockdowns and reduced energy demand on an unprecedented scale, has taken a sledgehammer to the oil and gas industry at a time when the planet is already being weaned off fossil fuels in favour of increasingly cheaper renewable energy.

For a country such as Saudi Arabia, where oil and gas represents about 87% of its national budget revenues, 42% of GDP and 90% of export earnings, this spells bad news.

But it also helps us to understand why it has sped up the acquisition of a football team that may not initially feel like a wise investment in an economic climate that is forcing Crown Prince Mohammed bin Salman to rein in some of his Saudi Vision 2030 grand reform plan, at least in the short term.

Vision 2030, after all, is a programme that aims to diversify the Saudi economy into areas including tourism, infrastructure, health and recreation.

Having a seat at the top table of the world’s most-watched league in the globe’s most popular sport will play a major part in drawing attention to all this.

“Saudi Arabia desperately needs to diversify,” says Professor Paul Stevens, an academic expert on the Middle East.

“It should have been doing it since 1973 and every time the oil price collapses, it talks about the need to diversify and cut back on expenditure – but when the price recovers, the imperative to do so disappears.

“This time around, for a number of reasons the oil price isn’t going to go back to the sorts of levels we saw a few years ago because we’re in the middle of an energy transition and moving from hydrocarbons to electrons.

“In my opinion, the energy establishment — groups like Opec and others — is seriously underestimating the speed and depth of that transition.

“That was even before the pandemic but, in these circumstances, clearly the writing is on the wall for the end of oil — which, at the moment, means the end of Saudi Arabia as an economic powerhouse unless it can diversify — so there’s a greater imperative for it to do just that.

“Acquiring something like Newcastle United fits in with Vision 2030.”

While many opponents to the takeover, perhaps with some justification, accuse the Kingdom of attempting “sportswashing” — a term given to countries with poor human rights records that use popular sport to improve reputations — could the fact it looks set to go ahead suggest Riyadh has finally accepted the dominance of oil and gas in the global energy mix is nearing an end?

Role of oil in Saudi Arabia’s energy mix

Before we get to Vision 2030, it’s useful to retrace the Kingdom’s energy mix. Roughly 60% of Saudi Arabia’s power generation comes from natural gas, with the remainder mostly comprising oil and feedstock.

The country’s 20% oil share in electricity production reported by the World Bank in 2015 is way above the 3% global average.

Over the past decade, the Kingdom has increased its oil production by two million barrels per day, but there’s also been a big push to develop natural gas capacity and petrochemicals.

“On paper, natural gas is the cheapest source for baseload power and isn’t very polluting compared to other hydrocarbons, so it’s the technology of choice,” says Fabrice Abalain, a regional analyst for the Middle East and North Africa in the Energy Industries Council (EIC) trade association’s Dubai office.

Renewables account for less than 1%, as ambitious schemes — including a $200bn project to cover hundreds of square kilometres of desert with solar panels, announced in March 2018 but scrapped seven months later — rarely get off the ground. Coal and nuclear have no role in the Saudi energy mix.

Abalain believes the Kingdom will eventually wake up to zero-emission sources as prices drop – solar has the greatest potential due to the country’s vast desert, and there are hopes it could increase its share of power generation to beyond 20% in a decade – but until energy storage technologies bear fruit, oil and gas will reign supreme.

While gas is the most important energy source in generating power for 34 million Saudis, crude oil wears the crown for exporting.

Seven refineries produce crude and other oil products that make up the 90% of national exports.

The state-owned oil industry is responsible for 45% of the Kingdom’s GDP, versus the private sector’s 40% contribution — which for most countries is at least 60%, according to the International Monetary Fund.

The public face of Saudi industry, its “crown jewel”, is Saudi Aramco, the world’s biggest oil producer with an estimated 270 billion barrels in reserves — supplying about 10% of the planet’s crude oil.

It is also by far the world’s most profitable company— eclipsing tech giants such as Amazon and Google parent company Alphabet.

Aramco made an $88bn profit in 2019; second top earner Apple generated $55bn in profits the same year.

In November 2019, the oil company made 1.7% of its shares publicly available for the first time on Saudi Arabia’s Tadawul stock exchange. Its $1.7tn valuation made it the most valuable IPO in history, with CEO and president Amin Nasser saying “it will increase our visibility internationally”.

Abalain says: “It’s the most important company for Saudi Arabia but it’s not a large economic partner for Europe because its main markets are Asia and the US. Russia is probably the biggest oil producer for Europe.

“Probably its biggest interest in Europe is through SABIC, the world’s fourth-largest petrochemicals company with operations in Europe, and Aramco bought 70% shares in it last year.”

The company’s success lies in its ability to produce cheap oil, with information shared as part of the IPO preparations showing it costs $2.80 to get a barrel from the ground that could then be sold for $62 according to last year’s prices.

Ellen Wald, author of a book about the Kingdom and Aramco called Saudi, Inc, told NPR in November: “It produces oil for so much less than anyone else out there. I mean in the United States, a fracking company is lucky if it can break even at $50 a barrel.”

But that all changed this year with the ripple effect of the Covid-19 pandemic. The introduction of lockdowns and travel restrictions around the world have decimated oil demand, which the International Energy Agency now expects to fall by a huge 8.6 million bpd this year.

The demand shock, coupled with a massive oversupply exacerbated by the Saudi-Russia price war in March after the failed Opec+ negotiations to address the health crisis, sent oil prices into rapid freefall.

And while a gradual rebalancing of the market delivered a rebound in May, the key benchmarks, Brent and West Texas Intermediate (WTI), remain at just half their value compared to the start of 2020.

All this has hit the bottom line at Aramco, which cut production from 12 million bpd to 7.5 million bpd in two months, as first-quarter earnings for 2020 dropped by 25% to $16.7bn compared to the previous year’s $12.2bn posting.

It’s also worth noting that even though last year’s IPO set headlines for its huge valuation, it wasn’t quite the success MBS had envisioned, generating $25bn – a quarter of the original target, although that was based on an initial projection to sell 5% of shares rather than the eventual 1.7%.

Abalain believes the economic impact of Covid-19 and the oil price crash will be huge for Saudi Arabia.

He adds: “No one wants to have a high oil price because it creates increased competition from other technologies but a low price is very bad news for both Saudi Arabia and Russia, as well as the US.”

Vision 2030: How Saudi Arabia wants to reduce future reliance on oil

Covid-19 would have sounded like something from a far-fetched sci-fi movie when the Saudi Vision 2030 strategy was revealed in April 2016.

But the pandemic has been an early test for a long-term economic blueprint that plans to raise the share of non-oil exports in non-oil GDP from 16% to 50% to find new ways of developing a “prosperous and sustainable economic future”.

In a press conference, Prince Mohammed – known as MBS and the brainchild of the scheme who would be awarded the title of crown prince the following year – told journalists the Kingdom could achieve its objectives with oil at just $30 per barrel.

But he added: “We think it is almost impossible to go under $30 because of global demand.”

A newly-diverse Saudi economy being proposed would involve localising renewable energy and industrial equipment sectors, while investing in digital infrastructure, culture, education and the military.

Abalain believes the young population has been a key consideration for the rulers.

Two-thirds of the population in 2012 was aged under 29 – compared to 41% in the US, as an example — meaning new jobs would need creating for a changing workforce that may increasingly accommodate women, who have pushed for reforms in the ultra-conservative state.

“How do you give them a new kind of society and bring Saudi Arabia to the international stage, so it’s not just seen as the oil provider of the world but actually a real destination for business?” asks Abalain.

A huge pillar of reform involves creating a tourism offer for Westerners that would grow the annual number of foreign tourists from 15.3 million in 2018 to 100 million in 2030, create a million jobs and increase the sector’s share of GDP from 3.8% to 10%.

It’s involved launching a new visa system for visitors, relaxing female dress codes and throwing big money at projects like the $8bn “entertainment city” Qiddiya, near Riyadh.

“Saudi Arabia really wants to show it has other channels than just Aramco,” adds Abalain.

But in a December 2019 report, Castlereagh Associates Gulf tourism analysts Daniel Moshashai and Rachna Uppal wrote such ambitions were unlikely to be fully realised due to “geopolitical risks in the region and the generally negative press surrounding Saudi Arabia”.

Such sentiments are why Prof Stevens is among a cohort of academics who label the vision “Mirage 2030”, noting it requires a new Saudi economy to be built virtually from scratch but is hugely dependent on the country’s private sector stepping up to the plate.

“But the private sector is very weak because there’s no property rights in Saudi Arabia,” says the Chatham House research fellow, who is also an emeritus professor at the University of Dundee.

“If you’re a citizen with assets, there’s nothing to stop the government taking them, as we saw in the Ritz-Carlton incident [where MBS reportedly detained hundreds of Saudi royals, billionaires and government officials in 2017, and told them they must sign away large chunks of their assets to be released].

“So the private sector is reluctant to get involved with Saudi Arabia.”

Importance of Saudi Public Investment Fund in diversifying the economy in future away from oil

Nevertheless, the Saudi government is moving full steam ahead with its transformation strategy and a key part of the Vision 2030 jigsaw is the Public Investment Fund (PIF).

Set up in 1971 as a “custodian” of government stakes in companies and to finance domestic projects, the sovereign wealth fund was earmarked by MBS in 2015 to drive forward his economic reform plan.

It now has about $325bn in assets with plans to increase this to $2tn by 2030, while the crown prince – who sits as chairman of the PIF — wants to raise the international exposure of its assets to 25%.

After announcing itself as a major player in 2016 with a $3.5bn stake in Uber and $45bn injection into SoftBank’s $100bn Vision Fund for backing ambitious tech start-ups, the PIF has taken centre stage during Covid-19 by making not insignificant bets on companies hit badly by the crisis.

Among the recent investments have been a 5.7% stake worth $500m in US entertainment group Live Nation, a 7.3% holding in the world’s largest cruise line operator Carnival and a series of small stakes in huge brands like Disney, Facebook, Boeing and Citigroup. These estimated by the Financial Times to have cost at least $7.7bn collectively.

As the PIF governor Yasir al-Rumayyan – primed to be Newcastle’s new chief executive should the takeover be approved – told a virtual conference in April, “you don’t want to waste a crisis … so for us, definitely, we are looking into any opportunities”.

The problem with investing at a time when the economy is crippled is the buyer can also be feeling the heat.

And alongside Aramco’s weaker-than-expected Q1 results, a projected -3.2% GDP contraction for 2020 has led to suggestions of Saudi austerity and cuts in spending for the Vision 2030 project this year. It means some of the Crown Prince’s grandest dreams could be put on ice.

University of Oxford modern history lecturer Mark Almond has compared the current oil price war to the 1986 crisis that, dovetailed with the Chernobyl disaster, “symbolised Soviet incompetence” and led to the collapse of Communism.

Writing in the Telegraph in April, he said: “Another geopolitical upheaval is on the cards, but this time West and particularly its Arab allies could be the losers.

“Saudi Arabia could afford its price war with the Kremlin in the 1980s. The Kingdom’s population was much smaller and so demands for social spending far lower.

“Its budget today is sorely taxed by the Crown Prince’s ambitious modernisation agenda, the generous subsidy of its growing population and the costs of the war in Yemen.

“To break even given its full-throttle expenses, Saudi Arabia needs oil prices to be around $80 a barrel.

“The Kingdom is running a budget deficit and a prolonged oil price crash could do for Saudi Arabia what it did for the Soviet Union in the late 1980s.”

Prof Stevens adds: “With the oil price situation as it is now, this pushes Vision 2030 to Vision 2050 or even 2090 because of the lack of revenue as a result of a lower oil price.”

It means economic diversification has never been more important.

Saudi Arabia increases investments in sport

Like 24 Hours of Le Mans, the Indy 500 and Monaco Grand Prix, the Dakar Rally occupies a prized spot at the top of the racing calendar.

Four weeks before the starting gun was fired in the Saudi port of Jeddah, the “Clash of the Dunes” heavyweight boxing match between Anthony Joshua and Andy Ruiz Jr was held at the UNESCO World Heritage site of Al-Turaif, in Riyadh.

There was also the inaugural Saudi Cup, billed as the world’s most valuable horse race, on 29 February this year as the Kingdom has poured hundreds of millions into showcasing it as a destination for big-ticket events.

But perhaps the most significant move is the takeover of Newcastle United. The club, based in the north-east of England, has a history stretching back to 1892 and has been a fixture in the Premier League for all but three seasons since its breakaway from the English Football League in 1992.

Despite a largely unsuccessful recent past, the club can command full-capacity crowds at its 52,000-seater stadium and has often been listed in the Deloitte Football Money League of the world’s 20 richest clubs.

This ranking owes largely to the pulling power of the Premier League, which is the most-watched sports league in the world with a claimed TV audience of 4.7 billion people — a calculation based on the fact it is broadcast to 643 million homes in 212 countries.

The cosmopolitan nature of the competition isn’t just the scores of nationalities that take to the field, but in ownerships too.

British, American, Russian, Chinese and Italian businessmen are among the purse controllers, while the precedent for a state-backed takeover was set when the Abu Dhabi deputy prime minister Sheikh Mansour bought Manchester City in 2009 and turned a mediocre club into one of the dominant forces in the sport.

And outside England, Qatar’s ruler Sheikh Tamim bin Hamad al-Thani has been owner of Paris St Germain since 2011 through the state-owned Qatar Sports Investments.

It’s against this backdrop that buying Newcastle for a mooted £300m figure begins to make sense.

Abalain says: “It looks like the takeover comes at a good time for Saudi Arabia but it’s part of the same strategy as the Dakar Rally and other sports investments, which are part of the Vision 2030 programme.

“Sport gives it an easy access to the masses through the media as so many people watch football, particularly the Premier League — it’s basically the number one place to be, as the UAE has found with Manchester City and Qatar with PSG.

“It’s really the tip of the iceberg for the conservative Saudi economy, which has almost exclusively been tuned into oil exports.”

Is Saudi Arabia takeover of Newcastle United as much about economics as ‘sportswashing’?

Each Saudi investment into sport has been met with major opposition due to the perception it is attempting to “sportswash” its human rights abuses, with Hatice Cengiz writing to the Premier League on several occasions urging it to stop the Newcastle takeover.

She was the fiancée of Washington Post journalist Jamal Khashoggi, who was murdered and dismembered at the Saudi consulate in Istanbul, by agents of the Saudi government in October 2018 after he had frequently criticised the regime.

The CIA later concluded MBS, the would-be de facto owner of the English football outfit given his role as the PIF chairman, ordered the assassination – something he denies.

Abalain accepts the takeover would be an exercise in soft power by presenting the idea of a “new Saudi Arabia” that is less repressive and ultra-conservative, but says it could also open up new economic avenues

“Sport is clearly part of Vision 2030 because having a club in the Premier League is like having a ‘tribune’ to speak at the table of the hyper-rich — it’s kind of a must-have,” he adds.

“I don’t think it’s a way to replace or change the nature of Saudi Arabia. It’s really about diversifying and going where it hasn’t yet.

“Before Vision 2030, the economy was just about exporting oil, which it’s always been very good at doing and this won’t change.

“Saudi Arabia will remain one of the largest, if not the largest, oil exporters in the world – and it’s committed to being one of the largest for at least decades to come.

“Living in the Middle East for some time, I feel like people here are very sure oil won’t disappear.

“The global population is 7.5 billion and there could be nearly 10 billion people by 2050, so energy demand will only increase.

“Many of these extra people will be in Africa and Asia-Pacific, where access to energy is an issue. It’s very unlikely that any new technology will be able to challenge oil in the next 20 to 30 years in these parts of the world.

“So these investments are by no means suggesting we’re moving away from oil – it’s just about making more money. If the core business is oil then it wants to create more revenues.”

Prof Stevens questions the sense in splashing £300m on a Premier League club during the current economic conditions as heavy investment without much prospect of large returns will be required in the short term, but understands the PR motive.

“Gulf countries are so competitive,” says Prof Stevens. “If one does something, the others have to follow.

“Given the roles in Man City and Arsenal [sponsored by Dubai-based airline Emirates], there’s this obsession by Saudi Arabia to say ‘we’re as good as the UAE’.”

But the headlines showing the Kingdom financing superstar footballer signings could cause a backlash if the economy at home isn’t kept in shape.

He draws parallels with the 2011 Arab Spring, which was sparked by a deep sense of disillusionment with how countries were being run and resulted in the downfalls of governments in Egypt, Tunisia and Libya.

He explains: “There’s a social contract issued by the rulers of Saudi Arabia to the people, which says ‘we will provide jobs and government subsidies but in the meantime you will shut up and do as you are told’.

“If the revenue isn’t there, then it’s worth reminding people about what happened in the Arab Spring because if jobs are taken away, it’s highly likely that Saudi Arabia will suffer the same problems.

“There’s going to be some unemployed person in Riyadh asking why his country is spending all this money on some football club in the north-east of England.”

What does the Saudi Arabia PIF takeover of Newcastle United say about the future of oil?

Ultimately, the amalgamation of the oil price war, Covid-19 and Newcastle takeover have shone a spotlight on a delicate situation for both international relations and the future of oil.

The price war, for which Saudi shoulders much of the blame along with Russia, has soured its relationships with not only the Kremlin but the US — whose shale and oil industries are on their knees as a result of the break-up of the Opec agreement at a time when tensions were already building due to the Khashoggi murder.

MBS is making a number of enemies at a time when the Kingdom needs friends, with oil demand now falling in Europe and about a decade away from peaking in its core market Asia, according to Prof Stevens.

“The reality is that the future of oil is strongly in question and therefore dependence is not good news for any economy – not just Saudi Arabia but other countries in the Middle East,” he says.

It means realising the goals of Vision 2030 has never been more important to Riyadh.

Abalain believes the Newcastle takeover “feels like good timing” as making friends in Europe becomes a priority when it could be on the brink of losing an ally in the US.

He adds: “Ultimately, what Saudi Arabia is very afraid of is an inability to sell oil. With rising tension between Saudi and Iran, a conflict in Yemen and tension in Libya, it needs to feel more secure during a difficult period.

“At times like this, it’s useful to have economic partners. So it needs the likes of the UK and France to buy arms from, and being in the Premier League could be a way of broadening its partners further.

“Part of that is to get into Europe to find different ways of doing business and communicating with countries on the continent, and to be seen in different ways than just an energy sphere.

“Sport is a great way of doing that. It’s definitely Saudi Arabia trying to get its Vision 2030 into action and make it seen as having potential for the European market.

“And while it won’t stop relying on oil reserves during this energy transition, which will take a long time, we’re going to see a lot more diversification that’s necessary for Saudi Arabia to show the rest of the world.”

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Proposed by EDF Energy – the French state-controlled electricity company that is also building the identically-designed Hinkley Point C – Sizewell C would be the third nuclear plant on the Suffolk coast.

While the £16bn ($21bn) scheme has been plagued with funding challenges that have delayed construction from beginning, a planning application has now been submitted.

If Sizewell C does go ahead, the 32-hectare site  will operate alongside Sizewell B – its predecessor nuclear power station located south of the new site – and the Sizewell A plant that is being decommissioned, with an estimated completion date of 2031.

EDF Energy claims it will provide about 7% of the UK’s electricity supply – enough to power six million homes – and contribute to the country’s 2050 net zero ambition by saving nine million tonnes of carbon emissions each year.

It also expects to offer a boost to the local economy through contracts and employment, but issues over the funding and construction costs have put the development in doubt at times.

Should the project fall through, it would be a significant blow to Britain’s energy industry, which needs to replace its ageing nuclear stock as a low-carbon source in a secure and affordable future electricity supply for the country.

Other proposed nuclear developments like Moorside, in Cumbria, and Wylfa Newydd, in Wales, have been halted due to funding problems, leaving Sizewell as the only project after Hinkley close to being built.

NS Energy takes a look at the capacity of the Sizewell C nuclear power station, its expected economic benefits and the challenges it has faced.

What is Sizewell C? The reactors and capacity of nuclear power station

The Sizewell C nuclear power station will be almost identical to the Hinkley Point C power station, which is forecast to come online in 2025. It is being built in Somerset by EDF Energy and its Chinese partner China General Nuclear Power Group (CGN).

Sizewell C will be made up of two European pressurised reactor (EPR) units – technology that EDF and CGN have also deployed at Hinkley Point C and the Taishan nuclear power station in China.

It could produce 3.2 gigawatts (GW) of electricity at full capacity, according to EDF Energy’s proposal.

The combined energy generated by the existing Sizewell B power station and Sizewell C is estimated to meet 10% of the UK’s energy requirements, with the bulk of that power set to come from the new plant.

The EDF proposal also claims the cost of connecting the power station to the national grid will be low as connections have already been put in place by planners.

Funding challenges put Sizewell C nuclear power station in doubt

EDF has predicted the cost of Sizewell C will be 20% lower than Hinkley Point C – which is set to cost about £20bn ($26bn) – because of the similarities between the stations and established infrastructure.

But in an interview with The Times in April 2018, the company’s UK chief executive Simone Rossi questioned whether the project would remain “feasible” without faster progress being made at the Hinkley Point C site – which has suffered from rising costs and delays – and a government guarantee.

The firm is still talking with the government about workable funding models that can convince it to stay at the table.

Speaking about the possibility of no functional funding model appearing, Mr Rossi said: “This is the year where we need to understand whether this whole thing is really feasible or not.

“If we were to conclude that maybe it’s not feasible, then at that point maybe we say we are not in a position to continue the project.”

In January 2020, it was reported that EDF was running out of time to secure a funding deal before the project became prohibitively expensive.

That’s because any funding delay cause a hiatus on the project, it would prevent the company from being able to transfer workers and equipment from the Hinkley development – thereby eroding the planned cost savings.

It’s been reported that using pension funds to part-fund construction of Sizewell C is one option being mulled over.

The government funding package has also yet to be finalised, with the findings of a consultation into alternative mechanisms still to be published.

One option being explored is the regulated asset base model, which is used to incentivise private investment into public projects by providing a secure payback and return on investment for developers.

EDF is seeking a different funding model for Sizewell C than the one in place for Hinkley Point C – which will cost consumers enormous sums as a contract between the UK government and the EDF-CGN partnership guarantees the energy firms a £92.50 ($120.40) megawatt-hour price for electricity generated at Hinkley Point C.

Trade union pushes for Sizewell C nuclear power station project go-ahead

During times when the Sizewell C nuclear power station project faced an uncertain future, energy union GMB has repeatedly urged stakeholders to go ahead with the power station.

It intervened after the National Infrastructure Commission (NIC) pushed for a rollback of the government’s plans to build a host of nuclear power stations – reportedly recommending only one of six proposed sites should be built in July 2018.

NIC chairman John Armitt claimed to be “agnostic” about whether Sizewell C was the chosen development.

In September 2018, GMB national energy secretary Justin Bowden said: “Starting with Sizewell C, Britain still needs at least five new low-carbon nuclear power stations if we are to meet our energy needs and reduce our dependency on foreign imports of power whilst ensuring we have the reliable electricity that comes from very low-carbon nuclear, and lower carbon gas, to complement our renewable energy sources.

“Hinkley Point C will provide secure, very low-carbon electricity for all the times in a year when the wind doesn’t blow and the sun doesn’t shine.”

The need for Sizewell C appears even more pressing after the demise of the Moorside and Wylfa Newydd projects.

There are 15 reactors in Britain, generating 21% of the country’s electricity – but almost half this capacity will be retired by 2025, with all but one offline by the mid-2030s.

GMB has argued the UK needs five new nuclear power stations to meet growing energy demands.

But the project has also faced opposition from the Stop Sizewell C group and National Trust, which claim it will have a “devastating impact” on the area.

Campaigners have also said it will “suck vital funds” away from other technologies that could produce greener energy.

Sizewell C nuclear power station planning application submitted by EDF

On 27 May 2020, EDF submitted an application for a development consent order for Sizewell C to the UK’s Planning Inspectorate.

The company had been due to request permission in March but deferred it by two months due to disruption caused by the Covid-19 pandemic.

It said the project – to be majority-owned by UK investors – would create 25,000 jobs and 1,000 apprenticeships over a 10-year construction timeline, with 70% of the construction value going to British companies.

EDF added that it had received views from 10,000 Suffolk residents and organisations during four stages of consultation since 2012.

Sizewell C managing director Humphrey Cadoux-Hudson said: “Sizewell C is a net-zero infrastructure project ready to kick-start the economy following the coronavirus crisis.

“It will offer thousands of high-quality job opportunities and long-term employment for people living in Suffolk and it will strengthen the nuclear supply chain across the country.

“On top of the economic benefits, Sizewell C will avoid nine million tonnes of CO2 being pumped into the atmosphere each year.

“The project will play a key role in lowering emissions while helping the UK keep control of its low carbon future.”

It claims to have worked to address concerns about the site’s suitability, including around flood risk due to its low-lying coastal location between Ipswich and Lowestoft.

Previous reports have said that should the application – likely to take about 18 months – be approved, construction could begin by 2022.

Economic benefits of Sizewell C nuclear power station

EDF aims to build on the economic value of Sizewell B, which is said to be worth £40m ($52m) per year to the local area.

The energy firm also expects the power station to be a boost for East Anglian businesses – having received registers of interest from 1,300 businesses keen to work on the project as of late 2018.

Speaking after the planning application was lodged, John Dugmore, chief executive of the Suffolk Chamber of Commerce, said: “Sizewell C’s DCO application is momentous for businesses and residents in Suffolk.

“It will boost training and employment opportunities across the county and attract investment to regenerate rural areas and towns.”

He has previously claimed that contract work in the identical Hinkley Point C was worth more than £435m to the local economy.

Discussing the potential economic benefits of the power station in its proposal, East of England Energy Group chief executive Simon Gray said: “We know that 3,000 UK companies were involved in the construction of Sizewell B, with nearly 700 of them based in this region.”

In November 2018, a seminar about supply opportunities at Hinkley Point C in Braintree, Essex, encouraged businesses in Essex and Suffolk to obtain experience from working on this project to stand them in good stead for future schemes like Sizewell C.

EDF would treat the two counties as a single local market for both projects as their construction periods ill overlap.

Robert Edge, inward investment manager at Invest Essex – the inward investment and business support agency – said: “Business doesn’t see a county border, just opportunities.

“It’s a challenge for both Essex and Suffolk to maximise the supply opportunities.”

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Container shipping group AP Moller-Maersk, ferry line DFDS, renewable energy company Orsted, logistics group DSV Panalpina, airline SAS and Copenhagen Airports aim to open the 1.3-gigawatt (GW) e-fuel factory – one of the world’s largest of its kind – within the Greater Copenhagen area in 2023.

Once production is scaled up to full capacity, it could produce more than 250,000 tonnes of clean power annually by 2030.

AP Moller-Maersk CEO Søren Skou said: “Decarbonising the transport sector is a significant and complex task that requires collaborative contributions from every company, organisation and country.

“This project provides a first step in the massive transformation to produce and distribute sustainable energy.

“In Denmark, we have an opportunity now to accelerate the green transformation and take lead in powering the future with sustainable energy and I am pleased that we can contribute with concrete actions.

“We need many such projects both in Denmark and around the globe to achieve our ambition in Maersk of becoming carbon-neutral by 2050.”

What is the Denmark sustainable fuels project?

The proposed scheme could supply renewable hydrogen for Copenhagen’s transit agency Movia’s zero-emission buses and DSV Panalpina’s lorries.

It could also provide renewable jet fuel – e-kerosene – for SAS airplanes flying to and from Copenhagen Airport, as well as renewable methanol for AP Moller-Maersk’s ships.

The project – which requires regulatory approval and some public investment before any building work can begin – would require a large-scale supply of renewable electricity, which may come from offshore wind power produced by Orsted at Rønne Banke, off the Danish island of Bornholm.

Its first stage, which could be up and running by 2023, involves a 10-megawatt (MW) electrolyser that can produce renewable hydrogen used directly to fuel buses and trucks.

Stage two, set for a 2027 launch, comprises a 250MW electrolyser plant that receives power from Borbholm.

This factory would combine the production of renewable hydrogen with sustainable carbon capture from other sites in Copenhagen for creating renewable methanol for ships and e-kerosene for aviation.

Stage three, which could be operational by 2030 when the offshore wind potential at Bornholm has been fully developed, would upgrade the project’s electrolyser capacity to 1.3GW and capture more CO2 for sustainable redeployment.

This would be enough energy to create more than 250,000 tonnes of sustainable fuels, which have the potential to displace 30% of fossil fuels at Copenhagen Airport by 2030 – alongside its other uses in road and maritime transport.

DSV Panalpina CEO Jens Bjørn Andersen said: “The transport sector is very important for Denmark but leaves a significant CO2 footprint and we are committed to finding ways to pave the road for a greener future.

“While this initiative is local, our long-term ambitions remain global.”

A feasibility study to confirm the viability of the project is expected to be taken by 2021.

Copenhagen green hydrogen plant could be key to driving down costs of sustainable fuels

The industrialisation of sustainable fuels could go a long way to bringing costs down, which could have a wider impact beyond Denmark as they are currently more expensive than fossil fuels.

There’s hopes it could spark a similar “cost-out journey” to renewable energy technologies, such as wind and solar power – with the cost of offshore wind declining by about 70% in north-west Europe since 2012.

For this to happen, the project partners have urged governments to provide incentives for private investments in large-scale sustainable fuel production.

Orsted CEO Henrik Poulsen “Decarbonising the road, maritime and aviation sectors is key to bringing our economies around the world to net-zero emissions by 2050.

“Our vision to produce sustainable fuels in the Greater Copenhagen area will deliver the necessary industrial scaling to drive the needed cost-out towards making renewable fuels competitive with fossil fuels.

“With the right policy framework in place, this project could be a defining leap forward for the production of sustainable fuels in Denmark, which will further reinforce Denmark’s role as a global leader in technologies and business models for a sustainable future.”

SAS executive vice-president and airline operations COO Simon Pauck Hansen added: “We support multiple initiatives and projects in our home market and hope that this project can commercialise and become an accelerator for the transition to decarbonised aviation.”

Importance of green economy in post-Covid-19 world

As well as helping each of the six companies to achieve their own sustainability goals, the new plant will be a major contributor towards Denmark achieving its goal of reducing carbon emissions by 70% by 2030 compared to 1990 levels.

The partners – which will be supported by consultancies COWI and Boston Consulting Group – also believe it will give a boost to the Danish economy post the Covid-19 crisis, which has affected many of the companies significantly.

Torben Carlsen, CEO of DFDS, said: “The co-operation of fuel users and producers, along with scientists and society, is the fastest way to make sustainable fuels available as realistic alternatives to the fossil fuels we combust in our vehicles and vessels today.”

Denmark has stated an ambition for its aviation sector to be emission-free by 2050.

Copenhagen Airports CEO Thomas Woldbye added: “The challenge of creating a future-proof and sustainable fuel is common to everyone in the transport sector, and the fact that we are now working together in a partnership is crucial for us to be able to produce sustainable fuel in the necessary quantities.”

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The companies aim to create new two-way infrastructure that turns EVs into moving batteries plugged into the grid, and able to not just consume but supply the energy market too – generating new income for drivers as well as reducing transport emissions.

It’s claimed this system would redefine the customer relationship into one controlled by consumers using smart devices at home and on the move.

Centrica and Lotus CEOs on increasing uptake of electric vehicles

Centrica group CEO Chris O’Shea said: “We are committed to helping our customers and communities achieve net zero and to do so, we must enable the change to electric vehicles.

“We have the technology, the skills and the scale to do this and our partnership with Lotus is another step in bringing our commitment to life.”

Lotus Cars CEO Phil Popham added: “Our journey to net zero-carbon is absolutely lock-in-step with the Vision 80 strategy for Lotus – taking us to 80 years of the business in 2028.

“By then we will have transformed Lotus in to a truly global player in the high-performance, high-technology sector with a new range of cars that remain true to our fundamental promise of always being ‘for the drivers’.

“The difference is the energy and infrastructure that will power and support these products in the future – this new partnership demonstrates the progress being made and the ambition of our vision.”

What the Centrica-Lotus partnership for electric vehicles involves

Smart EV charging was put forward by the UK government-backed Electric Vehicle Energy Taskforce as key to enabling the transition to zero-carbon mobility in a report published earlier this year.

The taskforce, consisting of experts from across the energy and transport industries, suggested EV owners could plug their vehicle into the energy system overnight and a smart device would only charge it when demand – and electricity prices – were at their lowest, providing benefits for consumers and the grid.

A flexible charging platform in this style will now be developed by the Centrica-Lotus partnership, which aims to “power a future digital mobility lifestyle”.

Centrica will also facilitate a sustainability programme that leverages innovative, low-carbon technologies and helps to mitigate the environmental impact of everything from manufacturing through to sales and the daily activities of Lotus.

The partnership will help establish a new global charging and energy infrastructure for new products released by Lotus as part of the UK brand’s aims to reach net zero.

Carl Bayliss, vice-president of Centrica Innovations, said: “Owning an electric vehicle isn’t the same as owning an internal combustion engine car.

“We see a future where the customer, car and home are connected, enabling new services beyond charging the car, and new products and experiences replacing the unremarkable standard relationship with energy and the ownership of a car today.

“Lotus is the perfect partner as we embark on this, given the recognition and appeal of the brand globally and the fact that it is right at the beginning of its electrification journey.”

Uday Senapati, executive director for corporate strategy at Lotus, added: “Centrica brings a wealth of energy sector expertise to the table that will not only help us to determine the right course for our mobility strategy, but the hands-on capability to ensure that the right infrastructure is in place globally.

“The future of mobility is a huge opportunity for providing value-added services to the consumer and this platform will put Lotus at the forefront of that digital mobility ecosystem.

“We have set ambitious targets for decarbonising both our vehicles and our operations. Given the rate of change required and the importance of getting it right first time, the support of our strategic partner Centrica is going to be vital.”

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The 134-acre site in Cheshire is equipped with innovative technologies that can recycle waste to create fuel used in vehicles and domestic electricity.

Construction work is ongoing but with a growing number of businesses operating in the new power-from-waste sector already clustered on site, NS Energy takes a look at what the £700m ($910m) project involves.

What is the Protos plant?

Located east of the town of Ellesmere Port on land between the Manchester Ship Canal and M56 motorway, the Protos plant aims to develop power from sustainable sources that have yet to be fully utilised in the energy mix, while preventing waste from going to landfill.

Examples include a factory that can convert unrecyclable waste plastic into hydrogen, and a plant that can turn wood and general waste into combustible gas.

The individual businesses running these operations are clustered together, and encouraged to share ideas and resources with each other.

The ultimate goal is to generate at least 140 megawatts (MW) of low-carbon heat and electricity each year, which could power more than 250,000 homes.

Waste infrastructure developer Peel Environmental – part of the Manchester-based real estate firm Peel L&P – owns the site, known as New Ellesmere Port, after buying it from energy giant Shell in the 1990s.

It received planning permission in 2009 after a public inquiry and construction began in late 2015.

Twelve of the 16 plots – measuring between 50,000 sq ft (4,600 sq m) and 350,000 sq ft (32,500 sq m) – have been completed and some are now occupied, with the development now on its second phase.

Peel claims it will create 3,000 jobs and pump £350m ($460m) into the north-west economy each year.

The project is a key pillar of the North West Energy and Hydrogen Cluster, which is backed by industry and regional mayors, as well as the North West Hydrogen Alliance, featuring Shell, Cadent and Mott Macdonald among its members.

Both have stated aims to make the region a national and global leader in low-carbon energy generation.

It’s estimated the cluster, which spans across the Manchester, Liverpool and Cheshire areas, could deliver 33,000 jobs, more than £4bn ($5.2bn) investment and save 10 million tonnes of carbon per year.

The focus on hydrogen reflects a general trend as it is a low-carbon gas that produces only water and heat when combined with oxygen, and can be used to power homes and transport.

Which waste-to-energy businesses are located at the Protos plant?

Bioenergy Infrastructure Group runs the Ince Bio Power plant, which is capable of generating 21.5MW of energy annually by converting wood waste into combustible gas.

It says this could save 65,000 tonnes of carbon dioxide each year – equivalent to taking 40,000 cars off the road.

Progressive Energy has agreed to move into one of the four plots still being built.

The clean energy company is working on a £150m ($195m) project to use materials such as unrecyclable wood and general waste to generate 175,000 tonnes of bio-resource gas that could power up to 1,000 low-carbon HGVs and buses every year.

It will be the UK’s first commercial-scale bio-substitute natural gas (bioSNG) plant when it begins production, expected to be in 2022.

Recycling company Advanced Sustainable Developments announced in April 2019 it planned to place its first UK plant at the Protos site.

The factory would use new technology to recycle PET plastic into food-grade material – something that can’t be achieved by current recycling practices.

One of the most intriguing companies on the cusp of joining the eco-park is engineering company PowerHouse Energy, which has developed technology that can turn plastic into hydrogen.

The West Yorkshire-based firm – which agreed to acquire its original partner in the energy-from-waste scheme, Waste2Tricity, in December 2019 – uses advanced thermal treatment technology to heat waste up until it is vaporised into gases.

Known as distributed modular generation (DMG), it controls the environment in the chamber to break down the resulting hydrocarbons and create fuel cells – electrochemical cells that convert chemical energy into electricity.

Tests have been carried out at the neighbouring Thornton Science Park – part of the University of Chester, which has linked up with Peel Environmental in the Protos scheme – and there’s hopes it could eventually turn 35 tonnes of unrecyclable plastic into 47 tonnes of gas and two tonnes of hydrogen each day.

Planning permission was granted by Cheshire West & Chester Council in March 2020 for the £7m ($9.1m) plastic-to-hydrogen factory, which will employ 14 people once it is built.

Future of the Protos plant – with plans for more UK sites

Peel Environmental believes the overall plan for the Protos plant, which has not yet been given a completion date, will require up to £1.5bn ($1.9bn) of investment.

Once construction work has been completed at New Ellesmere Port, there are plans to replicate the site in other parts of the UK as part of a wider strategy to reduce the environmental damage caused by plastic.

More than 300 million tonnes of the material are produced globally every year, with at least eight million tonnes ending up in the world’s oceans to make up 80% of all marine debris.

Many believe that, under current projects, the oceans will contain at least 937 million tonnes of plastic by 2050 — more than the estimated 895 million tonnes of fish by the same year.

In the UK alone, almost 1.2 million tonnes of plastic goes to landfill annually.

Peel Environmental managing director Myles Kitcher told NS Business the Protos plant was effectively a “shop window for a lot of start-up technologies”, with plans to commercialise those innovations and expand across the UK.

“The development will look different in different places, so you may not have an energy-from-waste facility, but the concept of having local energy generation is the whole thought process,” he added.

“The whole industry is moving away from big power stations. The whole of Europe’s doing the same, from big power stations in one location distributing the energy across a wide area to a more decentralised approach.”

PowerHouse Energy, along with the then-separate Waste2Tricity and Peel L&P, signed a collaboration agreement in August 2019 to build 11 plastic-to-hydrogen plants across the UK, representing an investment of £130m ($170m).

But the company has further projects in mind too and predicts the UK could eventually support between 100 and 200 sites – dubbed “plastic parks” – nationwide.

Announcing the deal, Kitcher said at the time: “Hydrogen is increasingly being seen as a vital part of our journey to zero carbon.

“This deal could be transformational in delivering a UK first technology that can generate local sources of hydrogen but also provide a solution to plastic waste.

“As a business, we’re looking at solutions for all plastics with a vision for these facilities to sit alongside recycling and recovery.

“We’re pioneering this solution in the North West but local authorities across the country could benefit from a more sustainable way to treat waste plastic, while also creating a local source of low-carbon transport fuel which could help them meet their climate change targets.”

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