The future of the oil and gas industry will be shaped by a range of disruptive themes, with renewable energy being one of the themes that will have a significant impact on oil and gas companies.A detailed analysis of the theme, insights into the leading companies, and their thematic and valuation scorecards are included in GlobalData’s thematic research report,Renewable Energy – Thematic Research. Buy the report here.
As of 2022, oil and gas companies owned little over 1% of the total installed renewable energy capacity in a market dominated by traditional power producers. Renewable energy-based power generation is expected to grow at a CAGR of 6.9% between 2022 and 2030. Leading oil and gas companies are expanding their business portfolio with increasing investments in renewable energy. Companies such as TotalEnergies, Shell, and BP are expected to have over tenfold increase in their respective renewable capacities by 2030. Solar and wind energy have been the primary technologies in this transition, as these are quite well-established and witnessing a fall in equipment costs. Companies are also increasing their exposure to the budding biopower generation segment.
The oil and gas industry’s energy transition requires long-term planning that will reduce or eliminate carbon emissions, however, by diversifying their energy portfolios to include renewable energy projects, companies can make rapid progress, helping to achieve specific interim targets by the end of the decade.
However, not all companies are equal when it comes to their capabilities and investments in the key themes that matter most to their industry. Understanding how companies are positioned and ranked in the most important themes can be a key leading indicator of their future earnings potential and relative competitive position.
According to GlobalData’s thematic research report, Renewable Energy in Oil & Gas, leading oil and gas players in the renewable energy theme include TotalEnergies, Shell, BP, Equinor, Repsol and PKN Orlen.
Insights from top ranked companies
Shell has invested in the development of a variety of renewable energy projects such as solar, wind, and biofuels. Shell’s solar power projects are spread across the world with operational projects in the Netherlands, Oman, and upcoming projects in Australia and Canada. Shell’s wind power portfolio includes onshore as well as offshore wind power projects, with the majority of projects being offshore. Shell has also expanded its renewable energy portfolio through acquisitions.
BP plans on building 50GW of renewable energy capacity by 2030. In wind energy, BP has several running projects in the US and is working to set up new capacity via collaborations with energy players such as Equinor. BP’s solar energy affiliate Lightsource BP is aggressively pursuing new capacities and aims to develop 10GW of solar projects by 2023.
The company plans on being a strong player in the renewable electricity value chain by strengthening its production, storage, and distribution portfolios. TotalEnergies is targeting the installation of 100GW of renewable power generation capacity by 2030. The company has established solar and wind power projects across the globe and is already supplying electricity in countries such as Chile, Japan, and South Africa.
To further understand the key themes and technologies impacting the oil and gas industry, access GlobalData’s latest thematic research report on Renewable Energy in Oil & Gas.
- Reliance Industries
- Qatar Petroleum
- Kuwait Petroleum
- Saudi Aramco