The CEO of Repsol, a Spanish oil major, highlighted the barriers that hinder the global efforts to reduce dependence on oil and gas during a speech at the World Petroleum Congress in Calgary. José Jon Imaz stated that high electricity costs and inconsistent regulations are impeding progress towards cleaner energy sources like clean hydrogen. Imaz stressed the importance of an open-minded regulator that encourages the transition through incentives rather than bans.
Imaz also discussed the viability of carbon capture technology, noting that it is already cost-effective enough to support large-scale implementation in certain locations, although he did not specify where. He further emphasized the need for affordable electricity, as it is crucial for producing hydrogen fuel without emissions. However, the high costs of electricity and the varying tax and regulatory policies across different countries pose significant challenges to the development of clean energy technologies.
Imaz commended the United States for its Inflation Reduction Act, which provides government incentives for low-emission technologies such as carbon capture and clean hydrogen production. He suggested that the European Union should adopt a similar approach to drive the transition to cleaner energy sources.
In line with their commitment to renewable energy, Repsol has initiated a comprehensive plan to develop renewable energy sources. They plan to install wind, solar, and hydro-power plants with a combined capacity of 20 gigawatts by 2030. Additionally, a portion of the $4.8 billion raised from the sale of a stake in their oil business will be invested in renewable projects.
On the same panel at the World Petroleum Congress, the CEO of WestJet, Canada’s second-largest airline, discussed the challenges faced by the aviation sector in reducing emissions. CEO Alexis von Hoensbroech acknowledged that sustainable aviation fuel (SAF) is crucial for achieving emissions reduction but highlighted the high cost of producing it as a significant obstacle. He stated that the aviation industry has yet to see significant scaling up of SAF production from feedstocks like oilseed crops despite discussions on the topic for over a decade.
Von Hoensbroech pointed out that producing SAF from power sources would require more electricity than can currently be generated by wind and solar alone. He suggested that nuclear power plants may provide a solution in the future. It is worth noting that the aviation sector currently accounts for around 3% of global emissions.
In conclusion, the transition from oil and gas to cleaner energy sources faces various challenges, including high electricity costs, inconsistent regulations, and the high cost of sustainable aviation fuel. However, companies like Repsol and WestJet are actively working towards reducing their environmental impact and investing in renewable energy projects, indicating a growing commitment to a sustainable future.
– Rod Nickel and Nia Williams in Calgary, Alberta – Reuters
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