ALTERNATIVE OIL 2021
According to projections, the world’s energy demands are only going to increase in the coming years. Over the years, there has been a constant reliance on energy from fossil fuels, especially oil. This comes as no surprise as the fuel has many properties that make it an ideal choice. However, oil poses some threats to the environment, such that the world is looking for alternatives to supplement or even replace it. Indeed, there’s been a demand for cleaner, safer fuels over the years. However, there are other requirements regarding factors like affordability or fuel pricing, accessibility, and performance that need to be met.
So far, the predictions of 2021 by various companies in the industry, including S8 Contractors, show that oil will maintain its competitive dominance on the market as demand and hence prices are only going to increase. Simultaneously, some of these companies in the oil and gas industry are likely to diversify into low carbon energy. This will involve investing in low carbon technologies to reach their zero-carbon growth goals. As climate change discussions are gaining momentum, even more industry players will start pushing for processes that cut emissions. Both investors and regulators will exert this pressure in the industry. Solar energy prices are expected to hit new lows, such that the energy source is expected to become cheaper. This time around, this price reduction will be experienced in countries outside the Middle East, which over the years seems to have the most favorable conditions for the solar industry. In 2020, one of the measures to offset the economic effect of the COVID-19 pandemic included support for electric vehicles. These investments are likely to yield results in 2021. As such, sales of EVs are expected to rise 74% from 2020. Countries in the EU and the US administration are at the forefront of this initiative which is expected to drive sales. Despite this, EV will constitute a mere 5% of vehicle sales worldwide.
Among all these predictions by S8 Contractors and others, one thing stands out; advances in science and technology will support the rapid progress in finding energy sources with net-zero emissions and decide what the energy transition will look like. One alternative involves the conversion of coal and biomass to liquid fuels. Since those energy sources are in abundance in certain parts of the world, they are potential candidates for providing non-oil-based liquid fuels for transportation. Despite the promising nature of this conversion, there are still questions concerning its effect on the environment, economic viability, and tech status. The technology required to carry out coal liquidation is capital intensive. Additionally, the process yields twice as many greenhouse gases as compared to petroleum-based gasoline. These factors could serve as a potential barrier to the commercialization of this oil alternative. Biomass conversion may present lower greenhouse emissions; however, its production may mean the clearance of ecosystems, possibly leading to adverse environmental impact.
Nuclear energy is another promising alternative to oil, and according to NASA and some authorities in the industry, it is the most effective. Currently, France is leading the world in nuclear power generation, contributing to 80% of its electricity, while America has nuclear power reactors that account for 20% of household electrical output. As compared to other sources of energy, nuclear power has close to zero adverse climate effects and is relatively cheaper. However, there are concerns regarding public safety, with events such as Chernobyl proof of possible danger. However, with advances in research surrounding safer exploitation, it is possible that nuclear energy will become a staple energy source. According to some reports, nuclear energy could experience more exploitation in the year 2021, which would yield both good and bad outcomes. For example, in the United States, some reactors are scheduled to shut down, a plan that could slow down the movement towards lowering carbon emissions.
Renewable energy success such as solar and wind are also potential oil alternatives. According to industry projections, 2021 offers an excellent opportunity for the world to continue its efforts in reducing carbon emissions, and it begins with renewable energy. Even though renewable energy provides a refreshing break from biofuels, sometimes these sources need backup. For example, when the winds die down and it gets cloudy, people will have to resort to biofuels for energy. Alternatively, it is capital intensive to harness these types of energy. Despite the barriers, renewable energy as an oil alternative is expected to experience a rebound after its decline in 2020 due to the coronavirus outbreak. Most of the decrease in its exploitation was due to the shutdown of projects geared towards renewable energy production. As things get back to normal, the projects are expected to reopen. Stakeholders are also looking to explore renewable energy sources apart from the wind and solar, including green hydrogen and offshore wind technology. These industry initiatives are steps in the right direction towards attaining Sustainable Development Goal 7. And the industry is expected to become more resilient with more investments into technology and the mitigation of risks related to digitization of supply chain disruption, and so on.