Renewable energy has continued its blazing rise, creating a growing market for new jobs and causing a decline in demand for oil discovery skills that were once the dream of science and engineering inclined students.
The demand for oil accelerated with the invention of the motor car in the 19th Century. As car ownership grew so did the demand for oil to make petrol (gasoline) use as fuel. This is changing rapidly. One sign of this changing energy landscape is that Royal Dutch Shell, one of the biggest employers of petroleum geoscientists and engineers, is cutting investment in fossil fuels and focusing on electric cars. The energy transition is underway.
Shell has agreed to buy Ubitricity, owner of the largest public charging network for electric vehicles in the United Kingdom, as the oil major expands its presence along the power supply chain. Other oil majors have long begun to reduce their exposure to fossil fuels too. This trend is shrinking the market for oil discovery skills.
According to data provided to SAFE from Texas Tech University, in 2019 the United States’ 22 petroleum engineering programmes enrolled nearly 2,000 seniors. This was roughly 1,800 fewer than in 2016. In total, more than 4,500 US undergraduates were perusing petroleum engineering degrees in 2019, down 60 percent from three years before.
Read Also: Explained: Why Fitch cut Nigeria’s 2021 growth forecast despite oil rally
Imperial College London has announced it will suspend its Masters of Science in Petroleum Geoscience at the end of the academic year 2020-21. Stanford University has modified and renamed its petroleum engineering programme. It now called Energy Resources Engineering and offered by the Department of Energy Resource Engineering in the School of Earth, Energy, and Environmental Sciences.
In Saudi Arabia, King Abdullah University has also modified and renamed what used to be its petroleum engineering programme. It is now called the Physical and Geological department.
These universities are suspending, expanding, modifying and upgrading these courses in order to reassess the skillset needed in today’s broader earth energy industry to be able to come up with new fit-for-purpose courses.
“Universities keep or shutdown programmes mostly due to demand. I suspect the energy transition has discouraged many people from pursuing degrees in geoscience and petroleum engineering resulting in low demand levels, hence the decision to stop those programmes,” Joe Nwakwue of the Society for Petroleum Engineers Nigeria.
Nwakwue is quick to point out that in Nigeria he is aware that a lot of curriculum adjustments are afoot to reflect these realities. But argues that based on Nigeria’s reserve/production ratio for oil and gas of 56 and 72 years, respectively, the country will still need a constant supply of talents to optimally recover and deploy these resources for economic growth and development.
“It will be self-defeating not to do so. I suspect a lot of these departments will be renamed to Energy Engineering or studies or such other names that reflect our present realities.”
Nevertheless, Nigerian universities have a reputation for teaching from old notes. Although the country is still an oil economy – the sad thing is that the people graduating are not finding jobs.
There are about 13 petroleum engineering departments in Nigeria with an average class size of 50 students. This means they graduate about 500 students annually.
“The industry can only support 100 new graduates yearly because it is not labour intensive.
However, petroleum engineering and geoscience are based on the analytical subjects of mathematics, physics, chemistry and geography. These analytical skills will remain in demand,” Lateef Akinkpelu, a petroleum engineer and energy consultant at the Centre for Petroleum, Energy Economics and Law at the University of Ibadan, says in a phone interview.
“If the universities don’t listen, the best thing is for students and parents to be aware and not enrol their wards for petroleum,” Elizabeth Obode, a research assistant at Texas A&M University Qatar told BusinessDay.
The fossil fuel industry is challenged and would remain so in the near to medium term, experts say.
However, it still provides the world’s dominant energy supplying above 90 million barrels of oil per day. It has been forecasted that it will take a long time before any other energy source will replace those volumes. The best estimate is that it is still some 50 years away before that will happen.
“It is also important to recognise that training in petroleum disciplines prepares students for a career in related fields,” Nwakwue states.
The International Energy Agency (IEA) has projected that by 2025, renewable will become the largest source of electricity generation worldwide. “By that time, renewables are expected to supply one-third of the world’s electricity – and their total capacity will be twice the size of the entire power capacity of China today,” Fatih Birol, the IEA executive director, notes.
Renewables are not limited to solar, wind and hydro. Green hydrogen, another renewable energy source is rising. China is focusing on building a fuel-cell supply chain and developing hydrogen-powered trucks and buses as part of a 15-year plan for new-energy vehicles.
President Xi Jinping in September 2020 set a 2030 deadline for China to begin reducing carbon emissions.
The world’s most populous nation is targeting to have 1 million fuel-cell vehicles in operation by 2030, according to an energy savings vehicle development plan drafted by authorities, despite 2,700 such cars selling in the country last year.
Renewables rise is supported by financial incentives in a number of countries. In the US for instance, several federal government tax credits, grants, and loan programmes are available for qualifying renewable energy technologies and projects.
The federal tax incentives, or credits, for qualifying renewable energy projects or equipment include the Renewable Electricity Production Tax Credit (PTC), the Investment Tax Credit (ITC), the Residential Energy Credit, and the Modified Accelerated Cost-Recovery System (MACRS). Grant and loan programmes may be available from several government agencies, including the US Department of Agriculture, the US Department of Energy (DOE), and the US Department of the Interior. Most states have some financial incentives available to support or subsidise the installation of renewable energy equipment.
In Nigeria, the government has started a drive to grow renewable sources of energy beginning with its Solar Power Naija programme. Under this and a sister programme, the Federal Government through the Central Bank of Nigeria is making available single-digit interest loans, with 10-year tenure and two years moratorium.
The first several months of 2020 saw a sharp decline in renewable energy additions worldwide due to the strict COVID-19 lockdown measures that prevented projects from being carried out. But as these measures eased, countries have raced to take advantage of financial incentives that were expiring in 2020.
In 2019, renewable energy grew by 12.20 percent over 2018. Over the past decade, renewable energy consumption has grown at an average annual rate of 13.70 percent.
Renewables were the only category of energy that grew globally at double digits over the past decade. For perspective, in 2009 the world consumed 8.20 exajoules of renewable energy. In 2019, that had nearly quadrupled to 29.0 exajoules.
