Lockdown has delivered unusual environmental benefits and the calls for a green Covid-19 recovery have been gathering steam. Last week, Rishi Sunak announced the ‘green homes scheme’ in his Summer Economic Statement, which aims to make homes more energy efficient, while also creating thousands more jobs in the construction sector. More ‘green developments’ are expected in the third phase of the Covid-19 recovery plan, with the Chancellor indicating this will focus on rebuilding a stronger – and hopefully greener – UK.
The global oil and gas industry entered a crisis situation during the pandemic as many factories ceased operation. In mid-June, BP slashed the value of its assets by £13.9bn, revealing plans to cut its workforce by 15%. It forecast the price of oil would be a third lower than expected for decades to come and said it may be forced to leave new fossil fuel discoveries in the ground. It was later joined by Royal Dutch Shell, which announced its own £17.5bn write-down, with its vast gas business expected to take the heaviest toll.
Although oil, gas and coal are struggling in the face of the biggest economic slump in nearly a century, this can’t be solely be attributed to Covid-19. It’s about fundamental change hitting the entire sector. Since the Paris agreement in 2015, carbon-intensive projects potentially worth trillions risk becoming stranded if investors abandon them in favour of greener alternatives, as required to meet the goals of the agreement. Multiple nations are setting 100% clean energy goals, creating new demand for workers to build solar panels and wind turbines.
Economics are driving both sides of this equation. Building new renewable energy sources is cheaper than running existing coal plants. Renewable energy will also help recovery from the severe recession economists are forecasting. With sufficient investment, it’s forecast that green energy could potentially boost global economies by 2.4% by 2050, adding a whopping £78 trillion to worldwide GDP by mid-century.
Backing green energy could also lay the foundation for job gains elsewhere. Investing in volume would create 16.3 million additional renewable jobs by 2050, but also 13.3 million in the broader energy sector and 6.5 million across other sectors. The renewable workforce would account for nearly 42 million people worldwide by 2050. The solar industry could employ nearly 19 million by that year, followed by bioenergy (14 million), wind (six million) and hydro power (2.7 million).
The benefits would also extend far beyond economics. Environmental and social welfare would rise 13.5% thanks to the renewable push, delivering 70% CO2 emission cuts, cleaner air and better health by 2050. Renewable energy is also more diverse than fossil fuels, with the ability to generate more energy domestically, thereby reducing the impact of fluctuating international markets. This is particularly relevant with both Brexit and Covid affecting free movement and international supply chains.
In the US, the renewable energy industry has become a major employer. E2’s recent Clean Jobs America report found nearly 3.3 million Americans working in clean energy – outnumbering fossil fuel workers by 3-to-1. Nearly 335,000 people work in the solar industry and more than 111,000 work in the wind industry, compared to 211,000 working in coal mining or other fossil fuel extraction. The fastest-growing jobs across 12 states were in renewable energy during 2018, leading the Bureau of Labour Statistics to forecast America’s two fastest-growing jobs through to 2026 will be solar installer (105% growth) and wind technician (96% growth).
The UK looks set to follow suit with official data recently revealing that renewable energy made up 47% of the UK’s electricity generation in the first three months of the year. This smashed the previous quarterly record of 39% set last year. The government’s renewable energy data includes electricity from the UK’s windfarms, solar panels and hydro power plants as well as bioenergy generated by burning wood chips instead of coal.
A surge in renewable energy due to sunny, breezy weather and low demand during the Covid-19 lockdown drove fossil fuel power plants to a new record low. Gas-fired power plants made up less than a third of UK generation in the first quarter compared with over 40% in the first months of 2019. Coal-fired power made up 3.8% of electricity generated in the UK setting a new coal-free record of more than two months for the first time since coal-fired power generation began during the Industrial Revolution.
Although Covid-19 has caused inevitable delays with projects, Renewable UK said the renewable energy industry’s records were bound to be broken again in the years ahead as the government worked on “a massive expansion of renewables as part of the UK’s green economic recovery”. Businesses are also calling on the Chancellor to lay the foundations for a UK-wide hydrogen strategy. The strategy is being supported by 41 businesses employing around 100,000 people with a total value of £100 billion. The possible investment figure of up to £1.5 billion across various hydrogen projects could potentially sustain hundreds of thousands of high-skilled, green jobs, in all parts of the country.
If you’re looking for a new contracting role then why not consider recycling your skills in a different industry? Next time, we’ll be looking at how to make the transition from working in the oil and gas industry to the renewable energy field. ContractingWISE have access to a wide range of hassle-free services that can help you with setting up a limited company or finding the right umbrella company for you. To talk to a member of our team, call: 0203 642 8679