Across the pond, London-based BP and Netherlands-headquartered Shell are looking to invest in innovative electric technology, which is very good news here as well.
The two international oil giants, both of which have oil refineries in northwest Washington, recognize the growth in battery storage capacity. Their investments should bring down costs for consumers and bring ground-breaking technology to market quicker.
Making electric cars and new batteries for homes and power grids is a major step toward replacing carbon-based energy with electricity from renewables, such as wind and solar.
The worldwide fleet of electric vehicles is predicted grow to 320 million by 2040. BP’s prediction came at the 2018 International Petroleum Week conference in London.
BP’s chief economist, Spencer Dale, reported peak-oil demand is coming more quickly than BP predicted in the past with renewables energies surging faster than expected.
BP now believes that by 2040 roughly 30 percent of vehicle miles from passenger cars will be powered by electricity, even though electric vehicles would comprise only 15 percent of the global car fleet.
“The higher share reflects the importance of EVs in shared mobility, which would be closely-linked with the emergence of electrically-powered autonomous vehicles,” Dale said.
Last month, the Australian Broadcasting Corp. reported Shell purchased Sonnen, the German home battery company, as part of its strategy of investing in renewable technologies.
Sonnen is an emerging player in Australia’s energy market, establishing a base at the former General Motors Holden Ltd. site in Adelaide, Australia, to manufacture batteries for installation in homes. The purchase, subject to regulatory approval, is welcomed because it provides a much-need injection of investment capital.
Australian Broadcasting Corp. quotes renewables industry analyst Giles Parkinson, who runs renewable advocacy website Renew Economy, as saying the announcement was good news for consumers and would help make batteries more affordable with greater storage capacity.
“As you get more and more manufacturing, you’re going to start to see those costs coming down,” he told a TV station. “Basically the prediction for batteries is that it’s going to follow the same cost curve as solar. Solar has come down 90 percent in cost in the last 10 years.”
Sonnen officially opened its home battery assembly site at the Holden factory in November. Its workforce is expected to expand by 430 jobs by the end of the year, as the company embarks on a plan to build 50,000 battery systems over the next five years.
The company is one of the global leaders in smart, distributed energy storage systems. Sonnen is taking the right step when it comes to moving into home batteries development, just as Tesla is doing in developing batteries for the power grid.
Does this mean oil companies are abandoning traditional motor fuels, such as gasoline and diesel? No, but it represents an important shift in strategy.
Dale said BP still expects oil and gas to play a central role in the global energy system over the next 20 to 30 years. Shell sees lower carbon emission fuels as helping to significantly reduce greenhouse gases by 2040.
Shell developed a comprehensive forward-looking plan to reduce atmospheric carbon gases. For example, it believes that shifting to cleaner burning liquified natural gas in ocean-going ships, ferries and tugs will lower carbon emissions. Roughly 2 percent of CO2 emissions are attributed to maritime operations.
The bottom line is encouraging large investors, including oil companies, to finance and bring to market energy sources, other than carbon-based, is vital. The private sector, which thrives on bringing new products to market, focuses on consumer demands and needs — a strategy which has served America well.
It certainly beats adopting the sweeping $92 trillion “New Green Deal,” which would cripple our economy.
Don C. Brunell is a business analyst, writer and columnist. He recently retired as president of the Association of Washington Business, the state’s oldest and largest business organization, and now lives in Vancouver. He can be contacted at theBrunells@msn.com.