Global power generation is increasingly shifting towards renewable sources, reducing the reliance on fossil fuels. While global energy generation has risen by around 30% in the past ten years, renewable energy has nearly doubled over this timeframe. The share of renewables in the global energy mix is anticipated to reach over 40% by 2030, which would be a notable achievement in climate change mitigation. This rise is anticipated to be largely driven by the proposed capacity increases in solar and wind power.
The oil and gas industry participants – including producers, service providers, and contractors – are relatively new entrants in the renewable energy space. Despite this, they are making notable movements in the competitive landscape for renewable energy, particularly in offshore wind. TotalEnergies is anticipated to be the fourth largest producer of wind energy globally towards the end of this decade, if all its proposed projects go online. Even BP, Shell, and several other European players are building considerable renewable power capacity.
Lately, these European companies have somewhat slowed down the pace of investments flowing into renewable energy over the past year. Nevertheless, they still fare a lot better than the notable US-based oil majors, ExxonMobil and Chevron that are clear laggards in the renewable energy segment. These two companies have negligible capacity footprints in this theme and have no plans to alter this scenario in the near future.
Global power output has nearly doubled over the years, from around 14,500TWh in 2000. As per leading data and analytics company GlobalData’s estimate, the global power generation in 2025 will be around 31,000TWh and rise further to 37,000TWh by 2030. This growth is primarily driven by the rising electrification in emerging markets and the increasing energy demand from data centres, cryptocurrency miners, and other expanding digital technologies. Additionally, the growing adoption of electric vehicles, particularly in Europe, the US, and China where their market penetration is higher, is contributing to the rising demand for power. Considering all this, it is logical for energy companies to shift towards alternate, emission-friendly sources such as solar and wind power. Early adopters of renewable energy may secure long-term sustainability in the evolving energy landscape. Further discussion on the renewable energy theme and its impact on the oil and gas industry, along with an overview of the competitive positions held by oil and gas companies can be found in GlobalData’s new theme report Renewable Energy in Oil & Gas.
