Will oil and gas or renewables power the future? America doesn't need to choose

The importance of cross-pollination

There are multiple states in the US that have an established offshore oil and gas industry. This means a highly skilled and experienced workforce, tried and tested technologies and processes, manufacturing capabilities and a well-connected supply chain including fleets of ships designed to aid offshore operations and well-configured ports, are all ready to be mobilised.

A great example of this is Louisiana. The foundations for the Block Island Wind Farm were designed and built in the state, while a group of technical specialists from Louisiana-based companies provided engineering expertise, shipping services and marine welding support to get it ready.

The windfarm developers recognised Louisiana is a hotbed of technical innovation and is home to thousands of skilled workers due to its rich oil and gas heritage. The state handled over 60% of America’s liquefied natural gas exports of 2023, and oil and gas operations support about one in nine jobs in Louisiana. Offering local people the opportunity to diversify their skills by supporting the burgeoning renewables sector, as well as oil and gas, provides a sustainable route to paid work for the future, while plugging a growing skills gap.

Around 1.1M workers are needed to build wind and solar plants around the world, according to recent reports. A further 1.7M skilled workers are required to operate and maintain the renewables infrastructure. As a result, the NREL estimates the US offshore wind industry will need to hire between 15,000 and 58,000 full-time workers each year from 2024 to 2030.

However, there has already been a noticeable shift in American energy workers refocusing on renewables. According to the US Department of Energy, the creation of clean-energy specific roles across every state grew by almost 4% up until 2022. Data published by the Natural Resources Defense Council shows that clean energy jobs grew by 200% in 2023 compared with job growth economywide. It also claims renewable energy-focused jobs now make up 40% of the 8.35M people employed in the energy industry across America, which demonstrates the renewables sector can play a key role in lowering US unemployment rates if this trend continues.

A talent gap, however, could significantly delay clean-energy projects on American soil. The NREL has recommended that efforts should be made to attract and train tradespeople who have offshore experience who currently operate in oil and gas. They represent a pool of talent with transferable skills prime for supporting offshore wind projects.

The NREL also encourages greater collaboration between US industry stakeholders and global, national, regional and state partners on major workforce challenges through key working groups. It is simply not enough to create the jobs for local people, they will require continuous training to stay ahead of changing regulatory requirements, new advancements in technologies, and a broader understanding of international standards and equipment for offshore wind. This is important, as many offshore wind structures in America will need to include parts from Europe as the nation’s manufacturing capability catches up with more mature markets. For example, the Block Island Wind Farm features monopiles made in Spain, a 450-tonne generator from France, and blades from Denmark.

America’s workforce, who rode the oil and gas boom, now have an opportunity to secure a future career in renewable energy by upskilling their knowledge, and by learning about manufacturing techniques and design codes developed in the European countries who have a 20-year head start.

Furthermore, the industry will look to those individuals to create new processes and drive the advancement of homegrown innovations for the benefit of the country’s clean-energy sector, and their own prosperity. This cross-pollination will play a critical role in accelerating the renewables projects that have already been granted licences, and any others to follow.

Oil and gas can accelerate clean-energy goals

The oil and gas industry has already invested billions into clean-energy projects to help drive low- and zero-carbon technologies. We are witnessing a fundamental shift in how global oil and gas operators invest as they face mounting pressure to meet carbon-reduction targets. As they diversify their portfolios, synergies emerge between both the oil and gas and renewables sectors.

Skilled workers, vessels and technologies traditionally focused on oil and gas can be seamlessly refocused on renewables projects when available, which means less downtime resulting in significant cost savings for both sectors.

Furthermore, existing oil and gas assets can be repurposed to support both sectors as they have fluctuating needs over time. Decommissioning was once considered the answer to removing ageing assets, but it is costly, and it comes with major environmental risks. Therefore, oil and gas operators are more likely to opt for repurposing their assets to accelerate clean-energy projects.

According to an academic report, it has been estimated that approximately one-third of the total life costs (operation maintenance, and service costs) of an offshore wind project can be reduced if the oil and gas sector is involved; the key being to repurpose key assets such as rigs and support vessels. The sector is therefore playing a key role in driving progress in the renewables sector forward.

Included in the report is the example of electrifying oil and gas offshore operations by installing windfarms, which can also mean floating turbines. This would reduce the need to operate diesel or gas generators on the platform, reducing greenhouse gas emissions and air pollutants. Furthermore, the report recommends the use of oil and gas platforms as bases for windfarms.

There are significant cost savings on offer when electrifying platforms as it lowers operating costs, and it also improves safety by reducing the risk of on-platform ignitions. It also reduces noise and vibrations to protect marine life, as well as lowering emissions.

Another key point is that a rise in offshore wind installations will make it possible to produce green hydrogen at scale, which requires electricity generated by wind turbines to split water into hydrogen and oxygen through the process of electrolysis. The US has already started work on this form of clean energy. In 2021, the Department of Energy announced the Hydrogen Shot, which aims to reduce the cost of clean hydrogen by 80% to US$1 per 1 kilogram in a decade. Following that, in 2023, the organisation Hy2gen USA, launched a project to identify, evaluate and develop favourable locations to power renewable hydrogen and e-fuel production from gigawatt-scale offshore wind energy, mainly in the US.

The digital era requires a wider energy mix

According to the International Energy Agency, we have entered a ‘new age of electricity’ as nations around the world use more air conditioning, switch to electric vehicles, and build new data centres in response to the evolution of artificial intelligence (AI) and other innovations such as digital twins.

AI and digital twins can support the maintenance and support the long-term integrity of offshore assets such as rigs or floating wind platforms, so it’s important for the industry that these innovations continue to evolve. In the first half of 2024, new data centres totalling nearly 24 GW were planned to be built in the US, which is more than triple the same period last year and already exceeding the entirety of 2023. The oil and gas industry alone won’t be able to keep up with the energy demands of this digital revolution.

Instead, a mix of fossil fuels and renewables is most likely going to power the data centres in the near term as they rapidly expand nationwide. At this time, the US government is going through a period of change, and what lies on the horizon of America’s offshore wind sector remains clouded. However, it is clear the foundations have already been laid for an offshore wind sector to flourish. America has proven it can work with international counterparts to share best practice and drive technical innovation, but it will take a renewed collaborative approach across the energy sector, and globally, to take the US wind sector to the next level.

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