Renewable Gas : Corporate Strategies

A Still from BP Energy Illustrated on Natural Gas in the Net Zero World

Energy Change, a suite of responses to Climate Change, is happening at different rates in different sectors of society and economy. Amongst private enterprise, some companies and corporations are ideally placed to make bold, headline changes. They can do so because they are mostly energy consumers, rather than energy producers; although some of them are becoming renewable energy producers as a result of their actions. Examples include :-

EnterpriseAction
Waitrose and John Lewisbiomethane fuel for delivery vehicles
Marks & SpencerPlan A, renewable electricity
Microsoftbiogas, fuel cell energy, renewable electricity
Amazonrenewable electricity
Googlerenewable electricity

Consultancies and agencies research the progress that companies are making and publish guides to investors, such as :-

AnalystReport
As You SowCarbon Clean 200
Carbon Disclosure ProjectThe A List
UK Sustainable Investment and Finance AssociationOil pressure gauge

Although good progress is being made by many companies and international corporations, there is still one sector strongly resilient to change : the producers of crude petroleum oil, Natural Gas and coal, together with fossil fuel pipeline networks and refineries.

Taking just two companies, BP and Royal Dutch Shell, here is a short review of their strategies on the New Chemistry – how chemical engineering will be taking traditional non-renewable inputs, together with newly-sourced renewable inputs, and using both to make low carbon fuels.

1.   BP plc

Natural gas and the transition to net zero
Gas in a net-zero energy system

BP’s approach is strong on public relations, and neat-looking conceptuals, but weak on numbers as to the proportion of its products that it aims to properly decarbonise.

1.1 Decarbonisation

In fact, the word “decarbonise” is a BP buzzword, perhaps having been coined by BP public relations people in the first place. It means, variously, “to take the carbon emissions out of energy” and “to take the carbon out of energy”, but it is not used in the sense of “to reduce the amount of fossil fuels in energy”, and there is a very clear reason for that.

Of course, as could easily be expected, BP wants to continue to dig up zero cost ancient remains in the form of oil and gas – that’s the bedrock of their business model. Like all good capitalists, they want to capitalise on cheap dirt and make a pretty penny out of it. Unlike some private enterprises, they do not position themselves to capitalise on cheap labour, however their activities have included forging production contracts in unstable oil-rich and gas-rich states, so they do not necessarily have a clean record on human rights.

1.2 Blue Hydrogen

But BP using the concept of decarbonisation allows them to claim that Natural Gas is going to continue to be a viable fuel into the future, because it can have the carbon taken out. They even have the cheek to adopt the use of the term “Blue Hydrogen” for hydrogen sourced from Natural Gas, because they say that in future, the carbon dioxide from this reforming of Natural Gas methane into hydrogen will be captured and buried. Although they don’t say how much in percentage terms the amount of carbon dioxide they really think is possible to bury.

The term “Blue Hydrogen” should, in my view, be reserved for Renewable Hydrogen produced from water. Here are some suggested terms :-

Colour HydrogenTechnology
White HydrogenNatural Hydrogen from hydrogen wells. Non-renewable.
Yellow HydrogenHydrogen produced by solar energy, for example by electrolysis of water. Renewable.
Orange HydrogenHydrogen produced by using the heat from nuclear power. Non-renewable.
Red HydrogenHydrogen produced during chemical engineering. Non-renewable if the original chemical feedstocks are non-renewable.
Green HydrogenHydrogen produced from biomass, for example steam gasification of grass or wood. Renewable if the biomass correctly sourced.
Blue HydrogenHydrogen produced from water by the use of renewable electricity, for example by wind-powered electrolysis. Renewable.
Purple HydrogenHydrogen produced from the steam reforming of Natural Gas. Non-renewable.
Brown HydrogenHydrogen produced from the gasification or steam reforming of petroleum oil fractions. Non-renewable.
Black HydrogenHydrogen produced from the gasification of coals and peats. Non-renewable.

1.3 CCUS

CCUS or Carbon Capture Utilisation and Storage is another concept buzzword, that tries to put itself in a different bucket to CCS – straight Carbon Capture and Storage.

With CCUS, the intention is to use the carbon dioxide for something before it is buried, or using it for something instead of burying it, and claiming that this reduces net carbon dioxide emissions overall.

CCS or even CCUS would not be necessary if the carbon in energy was not sourced from under the surface of the Earth, and yet BP seem to believe that the complicated process of digging carbon up only to bury it again is a high scorer in climate change action. Actually, it’s an own goal. The real way to keep advancing is to ditch the fossil fuel raw materials.

1.4 Net Zero

Yes, another buzzword that you will hear everywhere, including the UK Government. Again, it is a way of defending the rights of oil and gas companies to continue to dig up carbon for energy and profit. “Net Zero” means “net zero carbon dioxide emissions”, and suggests that there are ways to capture and neutralise carbon dioxide produced from the use of fossil fuels. That it doesn’t really matter if carbon dioxide is formed from ancient sedimentary carbon and blown into the sky – it can be captured again somehow. That it doesn’t really matter if the energy system remains dependent on fossil carbon, and that all fossil carbon as carbon dioxide can be caught and rendered harmless, whether at the point of its creation in combustion or chemical processes, or from the atmosphere when it has been exhausted in flue gas. That so-called “negative emissions” can universally be achieved with the right technology rolled out, and that it can be economically effective.

1.5 Strategy

BP’s published strategy headlines unconventional oil and gas asset acquisitions and new international start-up projects in a range of collaborations : calling this : “Growing advantaged oil and gas”.

The “decarbonisation” projects are mentioned almost as an afterthought in “Venturing and low carbon across multiple fronts”, including waste-to-fuel, where bananas become jet fuel, and CCS in its “Clean Gas Project”, where carbon dioxide will be used in the fabrication of building materials.

What is not explained is the relative investment funding for these various futures.

2. Royal Dutch Shell plc

The “Shell Energy Transition Report” has a section 4 on “Changing our portfolio in the long-term, after 2030”.

Like other oil and gas companies, it has a line for biofuels in its diagrams. It has ambitions to move into the electricity market. It has ambitions for CCS – Carbon Capture and Storage. And in addition, in its section on “Advanced Biofuels”, it mentions it is fostering the IH2 technology, developed by the Gas Technology Institute, to produce liquid fuels from hydrogen, heat and catalysts. The hydrogen is Green Hydrogen, sourced from biomass.

This would be properly Renewable Gas and Renewable Fuel, if it works the way it seems to from the description

Like BP, Shell produces biomass-sourced liquid fuels – biofuels – to meet regulations in different countries and regions on the percentage of blended fuels that should be green. More information is given in its Annual Report section,

Company2018 Annual Account LineAmount
Royal Dutch ShellProduction, manufacturing and exploration$ 28,310 million
Research and development$ 986 million
BPProduction and exploration$ 2,159 million
Research and development$ 429 million

3. Summary

Shell and BP make strong mentions of advanced biofuels and synthetic gas and liquid fuels manufacture, but aside from minor production projects, they do not appear to have ambition to venture far out of their core business of digging up fossil carbon. Their calculated projections do not give much space to the contributions of green electricity, green gas and green liquids towards the energy of 2030, 2040, 2050 and beyond. Their energy projections are self-determining, self-referential and self-fulfilling : they don’t have a strong ambition to transition, so they don’t project a significant transition.

BP’s energy projection
Shell’s energy projection

It is possible to substitute biomass, water, renewable electricity and renewable heat for crude petroleum oil, Natural Gas and coal in the global energy system. It is the only surefire way to remove fossil carbon from the equation and prevent a build-up of carbon dioxide in the Earth’s atmosphere.

So the question is, who will ask them to do this ?