In business, every company aims to achieve better bottom lines. However, meeting this objective requires having not just the right tools, but the right energy. Today’s modern businesses deal with a host of challenges, from changing industry landscapes to mounting pressures from external forces. But amongst these challenges, one stands out in particular, impacting businesses big and small and across all sectors – the energy transition toward a cleaner and lower-carbon future.
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While these fundamental shifts in the energy landscape of the future take place, global energy consumption is expected to grow by 21% in the next 20 years as per the Stated Policies Scenario (STEPS) in the World Energy Outlook 2020. This will be driven by rising income, urbanisation, and increased access to electricity.
In this regard, we will need to consider how well we can address the elephant in the room, the issue of the Energy Trilemma, solving the challenging balance of energy reliability, energy affordability, and delivering cleaner energy solutions to meet the sustainability agenda.
While greater focus and investments are being channelled toward renewables, the challenge of increasing the share of renewables in the global primary energy mix lies in the intermittent nature and efficiency of solar and wind power generation. Energy storage solutions can circumvent this issue but until it is widely accessible and economical, natural gas will continue to play an increasingly important role in the shift towards a low carbon economy.
There are three key drivers which render gas as the choice of fuel for the energy transition.
Firstly, gas reduces greenhouse gas (GHG) emissions. According to the US Energy Information Administration (EIA), combustion of gas for power generation emits 40 - 50% less CO2, 80% less nitrogen oxide (NOX), and brings sulfur oxide (SOX) to near zero. For example, it is expected that by 2040, ASEAN coal power generation will contribute approximately 3000 million t of CO2 to meet the energy demand. Using natural gas will reduce this to half, of which the benefit is equivalent to planting 75 billion additional trees, or the size of 250 million football fields. There is no doubt that in the pursuit of a cleaner fuel and given time is of the essence, gas is an excellent alternative to cut CO2 emissions efficiently and effectively.
Secondly, there is ready proven technology and infrastructure for gas. Natural gas is not new to us and it has powered nations and economies for decades. The technology for diverse types of field development has been tested and continuously optimised to ensure cleaner operations. The world has not stopped there either. Modern technologies have emerged to effectively develop this cleaner resource. For instance, the PETRONAS Floating LNG facility is capable of accessing remote fields to extract the gas in a safe and cost-effective manner.
In fact, the most interesting characteristic of this fuel lies in its ease of adaptation to a repertoire of applications. For example, using LNG for land transport in replacement of high carbon diesel fuel, or LNG for marine bunkering to reduce emission of CO2 and SOX to meet the tighter emission control by various countries as well as LNG for industrial power generation.
Thirdly, natural gas is a reliable complementary fuel to renewables in the energy mix. In tandem with the adoption of renewable energy such as solar and wind power, natural gas plays a pivotal role in providing a stable baseload energy supply. This ensures energy security, especially given the rising energy demand, and addresses intermittent energy generation issues faced by renewable energy.
Natural gas, as the cleaner fossil fuel, will continue its role as a necessary complementary fuel towards a more secured, reliable, and lower-carbon pathway; one that will not impinge on the march towards economic progress while still supporting the cleaner energy vision.
As the energy transition progresses, having the right energy is crucial to help businesses progress sustainably. This is where natural gas, as the cleaner and more efficient fuel, plays a critical role.