They say two opposites attract, but when talking about green economy and petroleum it goes beyond just that. These are two economic forces that complement each other. When studying the growth of the green economy, one would naturally assume petroleum and the green economy would have an inverse relationship, but many petroleum companies are working to debunk this common misconception. As discussions about climate change continue, many of the oil and gas industry’s biggest names are hard at work in adopting economic strategies to expand and diversify the green economy for the purpose of sustaining economic growth while addressing pressing concerns about climate change, global warming, and the surge of harmful greenhouse gas (GHG) emissions.
Expanding green investments is one of many economic approaches that have played a big part in boosting the green economy as there’s no denying that when the cash gets pumped into the system, the economic wheel starts turning. Shell for example has had a number of notable contributions to developing and growing the green economy including financing its Renewables and New Energy Solutions division with up to $2-3 billion. As a company, its main focus given current climate concerns is to decarbonize and focus on electricity. All of its reforms paid off when Shell started offering its British residential customers electricity that is 100% renewable. This entails that when every unit of electricity is used, an additional unit is put back into the grid by renewable generators.
One of Shell’s biggest executives even noted that efforts in promoting the green economy have shown positive results, with the expanding renewable electricity sector becoming a trend in business communities across the UK. “A recent survey of senior business decision makers across the U.K. found that almost two thirds either already purchase renewable electricity or are planning to do so as environmental factors become more important to businesses of all sizes,” said Colin Crooks, who was CEO of Shell Energy Retail Limited at the time. “We can help them on their decarbonization journey, by offering simple and reliable solutions for managing their energy costs and planning their sustainability roadmap. Together, we can play a part in the U.K.’s national drive to net zero carbon emissions.”
Diversity is an essential aspect of enabling the growth of any healthy green economic sector, an endeavor which TotalEnergies has sought to contribute to by working to develop different green sectors and others types of renewable fuels including, most notably, biomass. This is in addition to its active involvement in promoting new promising markets in wind energy, solar energy, and hydropower. Consistent with strategies set by many oil and gas companies, TotalEnergies has also established a new subsidiary in 2021 called Total Quadran which operates up to 340 renewable energy plans (including 224 solar plants) in France. This represents a huge leap in promoting the green economy as an essential provider of essential utilities, including up to 1,765 GWh of renewable electricity annually.
Apart from diversity, it could easily be said that some companies are even becoming part of the green economy itself, such as Equinor which aims to diversify its scope of work. This is in addition to joining the Climate Action 100+ initiative which involves a large group of ambitious investors as well as $33 trillion worth of assets. “Equinor is developing as a broad energy company, with oil and gas, renewable energy and CCS as integrated parts of our business,” the company said in a statement. “In our Climate Roadmap, we communicate our commitment to reduce own emissions and help drive decarbonization by scaling up investments in new energy solutions and low carbon R&D. We recognize the value of transparent reporting of climate-related risks and annually stress test our portfolio against recognized low-carbon energy scenarios.”
Studies have also shown the growth of the green economy has been accompanied by increasing demands for digitalization, not only for regulating and minimizing emissions but to optimize operational and energy efficiency. According to the study titled “Digital Economy, Technological Innovation and Green High-Quality Development of Industry: A Study Case of China” by Li Liu, Tao Ding and Hao Wang, digitalization can be used “to raise the level of efficiency of carbon accounting of investment and financing projects and enterprises by financial institutions through digital technology, establishing the carbon footprint disclosure system of financial institutions, to provide preferential investment and financing conditions for green and low-carbon enterprises and projects and force enterprises to green transformation will be useful in a forward-looking envisioning of green development.” Baker Hughes and other big multinationals have had big accomplishments in promoting digitalization, which can enhance the efficiency of any green economic sector.
The expansion of the green economy is not only vital for societies to enjoy economic prosperity and open the doors for limitless development but it has also become essential for the global community’s environmental security. When drawing up plans for a better tomorrow, it is important to understand that the possibilities in the green economy are endless because it does not involve just renewable energy, but several other sectors including green buildings, sustainable transport, water management, waste management, and land management. The sky is the limit as it includes any sector of the formal economy that works to promote or preserve the environment, ecosystems, and biodiversity. Now, the green economy is no longer just a handful of small businesses that sell non-plastic bags or dresses made out of environmentally friendly materials. It is an economic force that has to be reckoned with, which is an accomplishment that would not have been possible without the efforts of the oil and gas industry.
