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Oil and gas companies are facing major technological disruption

The EconomistKristina Bechteler, Farmer Einsiedler, Günter Mürgele
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  • The value of the world's largest power companies is projected to halve within eight years, a trend illustrated by E.ON's share price dropping over three-quarters in that timeframe as renewables become cheaper and customer behavior shifts.
  • Oil and gas firms anticipate a fundamentally different future and are banking on cleaning up existing processes, prioritizing gas over other fossil fuels, and hedging bets through investments in biofuels, batteries, solar, and wind to maintain relevance.
  • Statoil aims to become the most carbon-efficient oil and gas producer via a 1.2 billion euro joint venture in wind, with its first floating wind farm scheduled for delivery off Scotland's east coast by 2017 to leverage cheaper, mass-produced technology.
  • E.ON plans to spin off the majority of its fossil fuel assets by the end of 2016 while scaling wind and solar investments to manage millions of feed-in and consumption sites within a "green society."
  • Forward-thinking companies expect to withstand the renewable revolution by embracing alternative technologies now to adapt to totally different societal expectations driven by climate change.
  • Wind and solar face significant challenges regarding unpredictable weather and a dependence on subsidies to match fossil fuel consistency, though combining renewable sources is seen as the solution for a steady energy supply.
  • Energy storage is identified as absolutely key to utilizing wind and solar power around the clock, with a residential battery system developer expecting technology to allow customers to replace traditional utilities 100% and go independent by sharing power.
  • A major disruption is anticipated for Germany's big four utilities as nearly 1,000 energy cooperatives emerge, with some communities claiming the ability to generate over 100% of their energy needs even without wind or sun.
  • Floating wind turbines are viewed as the future capable of producing cheaper electricity anywhere in the world by reusing oil and gas sector technology, allowing for quicker and cheaper production than static windmills.