Royal Dutch Shell pursues development of cleaner fuels

MANILA, Philippines - The Royal Dutch Shell Group is spearheading global efforts to develop cleaner fuels, its top executive said.

“We are also raising production of cleaner-burning natural gas. When used to generate electricity, natural gas emits 50 percent less CO2 than coal. It can help build a bridge to a future when renewable energy, comes of age. By 2012 more than half of Shell’s production will be natural gas,” said Peter Voser, chief executive of Royal Dutch Shell Plc.

Voser said this is consistent with global initiatives to address climate change.

“We are seeing early signs of a far-reaching shift in our world’s energy system. Desire for secure energy supplies and concern over global warming have consumers, companies and governments embarking on a long journey toward a more sustainable energy future,” he said.

The Shell official has urged further cooperation among nations to achieve this goal.

“Government policymakers are currently in the best position to accelerate our trip. Starting with the climate change summit in Copenhagen this month, they will largely determine whether society steps on the throttle, or idles along at the current speed,” he added.

But Voser pointed out that the journey to much cleaner fuels will not be easy.

“Building a new energy future will take a huge effort. But it will be a boon for consumers, thanks to a great proliferation of energy types, from cleaner fossil fuels to renewables such as biofuels, wind and solar, to nuclear and hydrogen. Everything from cars to fridges will be much more efficient than what we know today,” he said.

Voser said the entry of these cleaner fuel technologies will also take time.

“Some people hope that the future can arrive as fast as the next big hit in consumer electronics. That’s unrealistic. Over the past century each new energy technology, once it was proven, has taken about 25-30 years to grow to providing one percent of the world’s energy. Biofuels are just now reaching that mark. Wind could be there by 2015, 25 years after the world’s first big wind parks went up in Denmark and the USA,” he added.

He noted that “it simply takes time to build the industrial and people capacity needed to produce energy on a massive scale. And to learn by doing. Today’s largest wind turbines have nearly 100 times the generating capacity of the ones available in the mid-1980s.”

Voser said coal and oil will remain the major source of energy for now until efforts from nations are enhanced in developing new energy sources.

“Society’s great hope for accelerating the pace of change lies with aggressive government policies, incentives and financial support for new energy technologies – from the lab all the way through commercial deployment. Indeed, every major new energy source since coal and oil has flowered thanks to extensive government support and a regulatory framework conducive to private investment,” he said.

According to Voser, “this isn’t about government handouts to business. It’s about spurring innovation and encouraging companies to invest in technologies that can help reduce emissions, but are still far from able to make money.”

“Support must be tailored to individual technologies, depending on their stage of development. Take the promising technology to capture carbon dioxide emissions from power plants and other industrial facilities and store it safely underground,” he pointed out.

He said governments in Europe, the USA, Canada and Australia have pledged more than $20 billion to support some two dozen pilot projects with the hope of having at least 10 running by around 2015.

“In the longer term, the main factor encouraging deployment of low-carbon technologies will be a price on emitting carbon dioxide. The most effective pricing mechanism is a system that caps CO2 emissions and allows companies to trade emission allowances, as the European Trading Scheme already does,” he added.

“With government’s lead, society can jump-start the development of new technologies with potential to reduce greenhouse gas emissions. Let’s get going,” he stressed.    – Donnabelle Gatdula