Although it would be unlikely to find an expert who believes oil and gas companies will abandon exploration and production operations anytime soon, several majors in the oil and gas industry are expanding their businesses into the renewable energy sector.
Sustainability is a topic that many company leaders around the world are thinking about more and more these days. Although for now, mostly the European oil and gas (O&G) sector has taken a keen interest in the subject, as the shift away from fossil fuels gains momentum due to climate change concerns.
Given these dynamics, this is a moment for oil and gas companies to make thoughtful choices: both to improve their economic and reputational resilience, and to consider whether and how to reposition themselves to take advantage of the accelerating low-carbon winds of change. A number of oil and gas companies have already set net-zero-emissions targets.
Among these technologies, O&G companies seem particularly well-suited to capitalise on geothermal, offshore wind, hydrogen, and carbon capture and storage (CCS).
According to Aaron Larson of Power Magazine, over the past five years, total investment in renewables, storage, advanced transport, digital technologies, hydrogen, and CCS by O&G companies has been almost $60 billion, with wind, solar, and battery storage making up the majority.
Solar and wind are particularly unpredictable so, to avoid situations where ‘green’ energy is wasted due to low demand on sunny or windy days and reduce the need to make up supply shortfalls on grey days with coal and gas, large-scale energy storage is key.
Battery Energy Storage for the Oil and Gas Industry
While pumped-hydro systems still dominate electricity storage, battery systems for stationary applications have started growing rapidly. Wider deployment and the commercialisation of new battery storage technologies has led to rapid cost reductions, notably for lithium-ion batteries, but also for high-temperature sodium-sulphur (“NAS”) and so-called “flow” batteries.
In the long-term, Battery Energy Storage Systems could support very high levels of variable renewable electricity, specifically by storing surplus energy and releasing it later, when the sun is not shining or the wind is not blowing strong enough.
Battery Energy Storage Systems are ideal to support a wide range of secondary services needed for the safe and reliable operations of O&G facilities, from improving power quality to providing backup power, frequency response, reserve capacity, black-start capability and other grid services, and storing power in electric vehicles.