Deloitte: We’ve picked low-hanging fruits, now it’s time for fundamental choices in energy transition

Transition

December 20, 2023, by Fatima Bahtić

The energy transition is at a crossroads, and it’s time to find new ways, Deloitte, one of the world’s largest professional services providers, highlighted at the Offshore Energy Exhibition & Conference 2023 (OEEC 2023) in Amsterdam this November.

The energy transition is one of the biggest challenges of today’s generation. At the beginning of their presentation, Oscar Kraan, Senior Manager Strategy at Deloitte, and Rebecca Visser, Senior Manager Industry Development at Deloitte, stated that good progress has been made in the Netherlands when it comes to the energy transition, however, the industry has also come to a crossroads.

“We’ve already picked all the low-hanging fruits, industrial production has been decreased, but to achieve our 2030 emission goals, fundamental choices now have to be made about our economic structure and the energy system that will enable it,” Visser pointed out.

She said that to make the right choices, both policymakers and industry professionals and academics need to join hands and have a clear view of the progress made so far. As part of its efforts to give a helping hand to the industry and support the energy transition efforts, Deloitte created an energy transition monitor to provide the view by assessing the current progress, but also to provide a view for what lies ahead in the future.

Furthermore, the energy transition progress can be summarized on three metrics, according to Deloitte. Those include:

the reduction of greenhouse gases (GHGs),
the share of the renewable energy, and
investment in clean energy projects.

Viisser informed that in 2022, renewable energy made up 15% of final energy consumption. In 1990, that was only 1%. Dutch households are investing at an increasing rate in clean energy. A third of all Dutch households now own either solar panels, a heat pump, or an electric vehicle, or maybe even several of these.

She argues that this is not a realistic picture and if we take a closer look, we will see that actually most of the reduction is in non-CO2 greenhouse gases.

“So the actual real transition hasn’t even started there yet. And even if we do get to zero emissions by 2050, have we by definition been successful if we have reduced emissions to zero by 2050?” Visser emphasized.

Kraan added that there are currently a lot of projects going on, encompassing sectors such as offshore wind, solar and nuclear energy, etc. Hydrogen will take a big role, but biomass will also play a role there.

“We have very ambitious targets, right? We’re going to 50 gigawatts of offshore wind in 2040, 70 gigawatts of offshore wind in 2050. And currently, as we as Deloitte, as I mentioned, we’re developing the infrastructure plan, to enable this transition for the Dutch government.”

“A lot of progress has been made. A lot of more ambitions are out there on the electricity side as well as on the molecule side. And this will really make the North Sea the powerhouse for not only the Netherlands but also for the broader Northwestern Europe,” he noted.

The developments and the progress depend on the industry collaborations. According to Kraan, supply projects can only make their investment decisions if they know the demand will be there. And similarly, on the demand side, the demand side sectors can only make the transition if they are certain that the green fuels are there to support them. So these need to go really hand in hand together with infrastructure. The government also takes a large role.

“We really need to develop this together. That’s why we are all here. That’s why making connections here at the conference is so vital because, supply and demand can’t do this on their own, right,” Kraan concluded.

For more details on the energy transition progress and developments, watch the video below:

View on Vimeo.