The state of energy: Learnings from CERAWeek

The way that we think about the energy transition is shifting again.

Just a decade ago, business leaders were under pressure to publicly recognize and take a stance on climate change and decarbonizing the global economy. That has changed: today almost every organization acknowledges the scientific facts and the need for businesses to act. I feel that shift in my own life, where I’ve used the phrase ‘energy transition’ more in the past year than ever before.

There is no doubt that this acknowledgment is a sign of progress, and at CERAWeek 2024 this was expressed in rallying cries for policymakers to focus on affordability and lowering emissions.

However, the world still struggles with the realities and pace of the energy transition. There was recognition in Houston that demand has become a much bigger part of the equation than many of us anticipated even compared to this time last year when security was the hot topic. You only need to consider the rising adoption of AI as one example of how changing consumer habits continue to drive demand. Not to mention the fact that around 733 million people are currently without electricity and global population and demand will only grow. Balancing the demand growth with how to progress lowering emissions of the energy in use today will be our next big shift in mindset.

To be clear, the need for action is only intensifying. 2023 marked the first time that every day in a year was at least 1°C above the pre-industrial average.

But calls for ‘turning off the taps’ of longstanding energy sources overnight do not reflect the hard facts of the abovementioned demand increases coupled with infrastructural needs, technological development cycles, and capital investment that make such a quick change impossible.

Our task is not just to rally for targets that aim to maintain our environment but to square our ongoing and growing demand for energy with the simple fact that the greenest unit of energy is the one you don’t consume.

That’s why, at ABB, we're not running away from the industries that we serve. And we’re not picking a winner. Instead, by investing in diverse solutions, we’re working to get technology up to scale in time to tackle these hugely complex demand-side shifts, finding additional capacity and emissions reduction through the optimization of existing assets in addition to looking to new sources.

That means acknowledging that, yes, hydrogen, carbon capture and renewables all have roles to play. And yet, there are also more affordable and readily deployable solutions available to us today like automation, electrification and digitalization that can start making existing sites more efficient now. These solutions received less airtime at the conference despite having huge and immediate potential to impact decarbonization across our industry, whether in O&G, hydrogen, LNG, or renewables.

Too often, energy transition conversations still overlook the ‘iceberg’ of electrification. That ranges from the less visible industrial energy demands that fall by the wayside in favor of an over-focus on electrifying personal transportation to the less obvious opportunities in optimizing and repurposing existing infrastructure.

At CERAWeek this year, I felt the beginnings of a shift in that thinking. There was a willingness to target making progress and meeting markets where they are, rather than demanding perfection and waiting for them to get to where we want them to be.

CERAWeek is a cornerstone of our industry’s calendar for a good reason. There’s nowhere better for customers, partners, industry experts and key players from government to coalesce, and nowhere else is so much important, future-facing thinking about energy so densely concentrated.

So how do we maintain momentum in the months to come? I personally connected with a lot of our customers to hear from them directly about the hurdles they are up against. We are walking away with both new challenging topics as well as inspiration for how we aid in our customers’ decarbonization roadmap.

I’d be interested to hear from you. If you attended the event, what did you walk away with and how are you driving change?