The climate crisis is making the world re-examine everything that produces carbon emissions, and energy is no exception. Oil companies are in for a rude awakening if they do not start preparing for a carbonless future.
Over the last few years, renewable energy sources that produce no emissions have become popular. In fact, they are starting to produce huge amounts of energy for some countries.
Not only will our electricity rely less on oil, but our vehicles will too. As electric cars begin to become more affordable, fossil fuel cars will become a thing of the past.
The only way the oil industry can remain profitable is by investing in low carbon technology.
Emissions on Two Fronts
Many people are familiar with the emissions released when oil is burned for energy. However, what if I told you that was only part of the emissions?
A staggering 15% of global emissions come from getting oil out of the ground and to consumers. That means before the oil is even used, it’s already produced an enormous amount of carbon into the atmosphere.
This simply isn’t a problem when it comes to renewable energy, like solar and wind.
They Are Losing Business
With the fall of coal around most of the world and the rise of natural gas, you would think oil companies would be doing great. However, renewable energies are gaining more of the market share every year.
And that is entirely thanks to the climate crisis.
For example, onshore and offshore wind in the UK makes up a huge part of their energy sector. In fact, onshore wind accounts for 9%, while offshore wind will account for 10% in 2020. That’s 19% total!
However, wind energy isn’t the only renewable energy oil is competing with. Solar energy is rapidly growing as the technology becomes more efficient and affordable.
When it comes to new energy in the United States, solar had a whopping 36% market share in the first quarter of 2019. And it is gaining popularity around the globe.
For countries that are seeking to significantly reduce their emissions, oil is just not appealing. And as more companies follow their goals of going net-zero, oil has no place to go.
Oil Companies Need to Act Fast
The only way that oil companies, and the millions of employees, can stay in business in the future is by adapting their business model.
These companies need to start spending far more money into carbon-capturing technology and not only improve the process of creating energy from oil but also how oil is retrieved from the ground.
If not, oil will fade away, just like coal is now.