Oil companies backtrack on renewables

Context: Major European energy companies have doubled down on oil and gas in 2024
to focus on near-term profits, slowing down and reversing climate commitments
in a shift that they are likely to stick with in 2025. Against this backdrop,
the likes of BP and Shell this year sharply slowed their plans to spend
billions on wind and solar power projects and shifted spending to higher-margin
oil and gas projects. The oil companies’ retrenchment is sad news for efforts
to mitigate climate change. Global heat-trapping carbon emissions are forecast
to climb to a new high in 2024, which will be the warmest year on record.

Key points

·       Overview: The
retrenchment by oil majors comes after governments around the world slowed the
rollout of clean energy policies and delayed targets as energy costs soared
following Russia’s full-scale invasion of Ukraine in 2022.

·       Renewable
Energy benefits: Sustainable - Energy generated from
renewable sources will be cleaner and greener and more sustainable.

Market assurance
-
From the economy point of view, renewable sources provide the market and
revenue assurance which no other resources can provide.

·       India’s
Key Focus: The Twin Challenge - India has a twin challenge of providing more
energy as well as cleaner energy to the masses in India.

Methanol and
Biomass - Looking for other alternatives such as methanol-based economy and
biomass.

Hydrogen based
FCV - Hydrogen in technology is likely to change the landscape of renewables,
shifting towards Hydrogen Based Fuel Cells Vehicles (FCV) is another area of
focus.

Grid Integration
-
It is the practice of developing efficient ways to deliver variable renewable
energy (RE) to the grid.

·       Challenges
with Renewable Energy: Integration with the Main Grid - Integrating
the renewables with the main grid is the area India needs to work upon. To
accelerate the uptake of renewables, storage and battery solutions is needed in
massive quantities.

Cost factor - Renewable
resources are slightly more expensive than conventional sources.

24*7 Power
Supply - Sustainable, round-the-clock power supply along with the storage system
is a big challenge ahead.

·       Way
Forward: Hydrogen fuel cell-based vehicles and Electric vehicles - These
are the most suitable options when it comes to shifting towards renewable
sources of energy, which is where we need to work upon.

Agriculture
subsidy - Agricultural subsidy should be rectified to ensure that only the
required amount of energy is consumed.

·       Conclusion: A well-planned
road map is needed, for which NITI Aayog is producing Energy Vision 2035 to
achieve India's clean energy goals. India should be working on areas like
investment in infrastructure, capacity building and better integration in the
near and immediate future.