Elise H. Nowee, President Shell Catalysts & Technologies analyzes five main trends that the energy sector will face in 2023, as it adapts to changing world markets and geopolitical dynamics.
As Ms. Nowee explains, it is a global imperative that the energy transition is already successful, “and to achieve the Paris Agreement goals of limiting global warming to 1.5 degrees this century, we must collaborate to accelerate.”
This collaboration must focus on how energy security, energy economics and the energy transition are brought together. Within the context of those three elements, she presents five trends that would be most impactful in the energy sector in 2023.
Trend 1: Impact of inflationary pressures resulting in the high supply chain cost environment
The industry will remain exposed to the challenges of higher energy prices, higher raw material costs and logistics shortages. These market dynamics will continue to impact the business and prices of catalyst products well into 2023.
Now, things are slowly and steadily improving on logistics, and though hard to predict the energy prices should come down with a changing supply/demand balance.
There will be an equilibrium in energy usage in many regions. We are already seeing consumers and industries reducing their energy demand by lower consumption, optimisation and transformation
Trend 2: Resilience in the context of geopolitical pressures
There are seeing trends all over the world where countries are moving away from being highly dependent on imports and exports. Many governments want companies to not only have a presence in the country they are headquartered, but also to have their assets there.
Through the challenges we have experienced during the past period with Covid-19 and the Russia-Ukraine war, people increasingly focus on more local products and businesses with a shorter and secured supply chain.
Trend 3: Innovation in decarbonisation solutions to achieve net-zero ambitions
The varied pace of change inhibits advancement towards Paris Agreement goals. In response, Shell reports, there is great potential in the joint value chains to accelerate progress toward net-zero ambitions. Additionally, there is a growing need to diversify energy sources and engage in the circular economy.
To meet these demands for more and cleaner energy, there are multiple solutions for refineries to maximise the value out of the barrel, increase energy efficiencies in production (yields), lower emission levels and increasingly recycle material, waste and used products back to plastics, lubricants or base oils to support the circular economy
Ms. Nowee said.
Trend 4: Innovation in core refining and petrochemical businesses
The key to leveraging core business assets in the current climate is to build upon existing technologies for an evolved purpose. The breakthroughs from the lab and testing sites are now being realised at scale at the Shell Energy and Chemicals Park Rotterdam, the Netherlands, where facilities once used to process crude oil are now being transformed to process low-carbon fuels from industrial and agricultural waste.
Trend 5: Collaborate to Accelerate energy transition progress
If we as a planet want to limit global warming to 1.5 degrees by 2050, we have to work very closely together. We can only be successful if we collaborate to accelerate. We all know that we must accelerate to reach Paris Agreement goals
urged Ms. Nowee, adding that Shell and the industry that must drive change, which also requires communities, governments and countries to work together.
