Oil majors to embrace renewable energy – Wood Mackenzie

Oil majors to embrace renewable energy – Wood Mackenzie

Global oil giants are set to invest heavily in renewable energy over the coming years as the industry grows and demand for oil slows, according to analysis conducted by Wood Mackenzie.

The energy consultancy group has predicted that more than a fifth of investment by the largest oil and gas majors could be in wind and solar power in just over a decade.

Demand for renewables will outstrip oil demand in the next two decades, according to Wood Mackenzie, with analysts forecasting annual growth rates of 6% for wind and 11% for solar, compared with just 0.5% for oil.

Valentina Kretzschmar, director of research at the agency said: “The momentum behind these [renewable] technologies is unstoppable now.

“They [the global oil firms] are recognising it is a megatrend; it’s not a fad, it’s not going away. There is definitely a risk to their core business.”

Most of the major players who traditionally produce carbon-based energy have begun investing in renewable energy, with Royal Dutch Shell a primary example.

The Anglo-Dutch firm recently announced its new energies unit will spend US$1 billion a year on biofuels, hydrogen and renewables by 2020.