Startups steal the show at summit
The biggest revelation at CERAWeek 2023, one of the world’s most important energy conferences, was the low turnout for the oil and gas CEO speeches and the standingroom-only crowds for clean technology entrepreneurs.
The energy transition is underway. The new technologies presented were definitely more interesting than the anodyne “investor relations” speeches, solely intended to boost stock prices. CERAWeek is changing with the times.
The annual event started as an energy leadership summit, with separate days for petroleum, petrochemicals, electricity and coal. In 2017, they added an adjacent conference called Agora to highlight emerging technologies.
More than 6,000 people attended last week, including 225 startup companies at Agora alone. The student is becoming the master.
“There has never been a more exciting time to be in energy,” was one of the conference’s most repeated phrases. Economists expect governments and businesses to spend more than $28 trillion on the clean energy transition by 2050 to slow and eventually stop global warming.
You can do a lot with $1 trillion a year. Some technologies and companies have a head start capturing some of that capital.
Hydrogen was the belle of the ball by far, as scientists celebrated its ubiquity and versatility. Petrochemical companies already produce H2 for fertilizer and chemicals. Electric generators can burn it in existing turbines, while fuel cells can turn it into electricity on a smaller scale. Fuel companies use hydrogen to make liquid ammonia and methane as a substitute for diesel.
The crowds at Agora wanted to know how to make hydro
gen economically without emitting greenhouse gases. They also wanted to know what industries would buy it first.
Andrew Marsh, CEO of Plug Power, says he reduces production costs by 25 percent every time he doubles the number of fuel cells deployed. He and many others said the first big market would be blending hydrogen with natural gas to lower emissions at power plants.
The rising star at Agora was geothermal power, which I recently wrote about. Different companies use different strategies, but the basic premise is the same: pipe water into the Earth’s hot zones and transform the hot water into energy at the surface.
Tim Latimer, co-founder and CEO at Houstonbased Fervo Energy, applies his oil drilling experience to the challenge. His company’s first well in Utah took 72 days, while his second took 59, dramatically reducing construction costs. He told the Agora audience he has agreements to generate 100 megawatts of electricity in California and expects that number to grow.
“I am obsessed with geothermal,” Energy Secretary Jennifer Granholm told Latimer and other geothermal executives during a private meeting at Rice University. “The problem of supplying dispatchable, baseload, clean power is what keeps me up at night, and geothermal is the solution.”
Other geothermal companies supply systems for homes, neighborhoods or industrial plants. One company, Denver-based Transitional Energy, operates mobile geothermal generators that take the heat from oil wells to create electricity on drill pads.
Major oil companies also have hydrogen and geothermal experiments underway. But their track record shows they typically invest in startups and buy them if they are successful. The next energy breakthrough could come from a Texas garage.
Texas is uniquely positioned to profit from the energy transition. We already have the most wind power in the United States and will soon have the most solar capacity. Not to mention, we have plentiful geothermal zones and a hundred years of drilling experience from oil and gas extraction.
Many of the hydrogen business plans rely on excess wind and solar energy to power electrolyzers that split off the oxygen atoms in H2O. Some companies plan to make hydrogen when renewable electricity is cheap, store it and then use it when the sun doesn’t shine and the wind doesn’t blow.
Marsh predicted grids will use hydrogen for backup power plants in the not-so-distant future.
Danish wind company Ørsted plans to use Texas wind to make hydrogenbased fuels on the Gulf Coast for ocean-going ships owned by Maersk. During a visit to Houston, Morten Bødskov, Denmark’s minister of Industry, Business and Financial Affairs, said he sees immense clean energy opportunities in Texas.
“There is strong cooperation between Danish and American companies right now developing new green technologies,” he told me. Danish companies employ 15,000 people in Texas, and Bødskov told Texas lawmakers at the Capitol that he expects the number to grow.
Big Oil will be around for decades, but to support life on Earth, the fossil fuel industry must shrink.
Opportunity is knocking for a new clean energy industry if Texans will answer the door.
Chris Tomlinson, named 2021 columnist of the year by the Texas Managing Editors, writes commentary about money, politics and life in Texas. Sign up for his “Tomlinson’s Take” newsletter at HoustonChronicle.com/TomlinsonNewsletter or Expressnews.com/ TomlinsonNewsletter. twitter.com/cltomlinson ctomlinson@hearstcorp.com