Choose a homegrown energy transition
David Whitehouse, CEO
| Offshore Energies UK (OEUK)
This is a critical year for the UK. Policy decisions made in 2024 will be felt for decades to come, writes David Whitehouse, CEO of Offshore Energies UK
The decarbonisation of our economy is one of the greatest challenges of our time and also the biggest opportunity to deliver the sustainable economy the country needs. Prioritising an energy transition which is homegrown will drive growth, support jobs, and deliver reliable supplies of cleaner energy in the UK.
Reaching net-zero carbon emissions by 2050 will require major changes to every industry, region, and part of our society. Today, approximately 75 per cent of the UK’s total energy requirements are derived from oil and gas, producing around 50 per cent of that demand domestically from the North Sea. So, this journey to net-zero will not be easy and presents choices. We can choose to get there by making the most of our people, skills, and heritage, or we can choose to increasingly rely on others to help us get there.
Some strongly protest that anyone with an oil and gas heritage has no place in this conversation. But the reality is that the path to successfully delivering on our climate goals whilst also creating high-value jobs in communities up and down the country is bringing people together, not by excluding companies and the 200,000 skilled workforce at the heart of UK plc.
While we continue to use oil and gas, we should prioritise our homegrown production to support our energy security, our economy, our jobs, and our world-class supply chain, which can be the foundation of our low-carbon future. The UK will need the churn of new licences to manage oil and gas production decline in line with our maturing basin.
Many companies investing in nascent opportunities like floating offshore wind, carbon capture and storage, and hydrogen will continue to require the cash flow from a stable and predictable oil and gas business to fund these opportunities. The fact is we need both oil and gas and renewables in an integrated system to protect the UK’s energy needs.
Working together, with an attractive investment environment and a strong industrial economy, the UK’s offshore energy companies could invest £200bn in homegrown energy production this decade alone. This investment will help the UK to reach its target capacity of 50 gigawatts of wind and 10 gigawatts of hydrogen and capture and store 20 - 30 MtCO2 by 2030. To realise this opportunity, businesses need policy that encourages investment and recognises a fair return. To give project developers and supply chain companies greater surety to invest, we must streamline our regulatory consenting and project approval processes for projects to move forward at pace.
The bedrock to success and delivering growth in the economy can only be in collaboration between private and public capital. The UK must not just become a good place to do energy business, it must become irresistible.
But you can only deliver this with skilled people. There must be recognition that the people and skills in our domestic oil and gas sector have a key role to play. The skills used to produce oil and gas over the past 50 years are the skills we require to unlock the low-carbon energies of the future.
The opportunities to transform how we power our society are inspiring. We need to attract the next generation. We are in action, working collaboratively to develop a skills passport that will enable career paths across the energy sectors. Our sector is committed to setting the gold standard for diversity and inclusion.
At the same time, we need to ensure that we engage with the public on this journey. A successful energy transition is one that is delivered with people and communities, not done to people and communities. A successful energy transition is one that delivers jobs and prosperity by working with our present industries, which are the platform for our green future.
Parliaments may thrive on opposition and argument, particularly in an election year, but big engineering projects only succeed through collaboration. The transition to net-zero will be the biggest engineering project this country has ever seen. It will fail if we undermine the industries, workforces, and communities whose skills will be vital for building our energy future.
Let’s unlock our potential, and power our future. Choose a homegrown energy transition.
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