Come 2030, the big names in renewable energy could be corporations we used to call “oil companies.”
The French oil giant Total invested $4.7 billion in solar, biofuels and batteries (along with gas) last year, the Guardian reports.
Norway’s Statoil is building the first-ever floating offshore windfarm. Shell is pledging to commit $1 billion per year to biofuels, hydrogen, and renewables by 2020. In all, today’s big oil and gas producers could spend 20% of their capital investment dollars on renewables in the next 10 years.
Critics scoff that unless renewables become core to the oil giants’ business, the impact of these investments will do little more than dress up their corporate income statements.
“Twenty percent of capex doesn’t even come close” to fulfilling the goals of the Paris climate agreement, said Greg Mutitt of Oil Change International, an advocacy group. “That 80% of capex is still causing the problem.”
But a tipping point could be near, research group Wood Mackenzie notes in a new report (paywall).
Renewables is the fastest growing energy sector, and is on track to grow to 21% to 36% of the world’s energy mix by 2030, from 18% in 2010. To seize a renewables market share similar to their current oil and gas share, major oil producers need to invest $350 billion on wind and solar power by 2035.
“They are recognizing it is a megatrend; it’s not a fad, it’s not going away,” said Wood Mackenzie’s Valentina Kretzschmar. “There is definitely a risk to their core business.”
