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Elvira Scotto on the race to net zero in energy

Few industries are evolving at a speed that comes close to the energy sector. The race to net zero has accelerated new waves of innovation, change and opportunity.

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By Elvira Scotto
Published July 27, 2022 | 2 min watch
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Key Points

  • The race to eliminate carbon emissions on a net basis by 2050 will accelerate new waves of innovation and create the largest reallocation of capital in history.
  • Rising geopolitical tensions have magnified the industry’s focus on energy security, reliability, independence, and sustainability.
  • Companies and governments face conflicting pressures to provide more oil and gas supply now – all while accelerating the energy transition.
  • Renewable digital technologies are already emerging, with a game-changing uptake of artificial intelligence, machine learning, sensor-led robotics and automation.
  • Companies and investors need to be one step ahead of the signposts and signals that indicate what’s coming next.

The urgency is real. Eliminating carbon emissions on a net basis by 2050 will require record levels of investment in clean energy infrastructure to transform energy production, delivery, consumption and efficiency.

The energy transition will create the largest reallocation of capital in history. Against this backdrop, rising geopolitical tensions have also highlighted how interconnected global energy markets are, magnifying the focus of both countries and companies on energy security, reliability, independence and, crucially, sustainability.

This is a critical inflection point in the future of energy. Russia’s invasion of Ukraine has created historic levels of volatility, as surging gas prices and supply chain disruptions distort today’s markets. The industry is navigating its greatest energy challenge in a generation. Companies and governments face conflicting pressures to provide more oil and gas supply now, all while accelerating the energy transition.

Breakthrough transformations

All of this points to a radical restructuring of the energy landscape to create a future that is affordable, secure and inclusive. The whole energy ecosystem is transforming right before our eyes – the only certainty is that tomorrow's energy markets will be radically different from today’s.

There’s no understating the challenge, but the rewards will be substantial too. Encouragingly, renewable digital technologies are already emerging, with a game-changing uptake of artificial intelligence, machine learning, sensor-led robotics and automation delivering step-changes in energy capture, storage and performance across the industry.

As an example, in the near future the term “prosumer” – a consumer of energy who is also a producer of energy to self-supply power or to sell it into the grid – will become more relevant. With advances in technology and cost reductions in renewable energy, power generation will take place at a much smaller scale, including by individuals. The energy needs of ‘smart homes’ will be supported by rooftop solar, batteries and EVs, turning homeowners into resilient energy prosumers, participating in power generation within a growing network of other households.

The Future, In Focus

To enable all of this, we need to accelerate the transition of national net-zero energy ecosystems, imagine new multi-stakeholder strategies, unlock new frontier technologies, and grow more sustainable economies.

As analysts, we know that transformation on this scale needs a sharp focus on the future and it will require a combination of vision, imagination and pragmatism for companies and investors to achieve their decarbonization ambitions.  

That’s why our RBC Imagine™ research program brings bold perspectives on the future of energy together in one place, offering a cross-sector lens on the themes and trends that will reshape the entire energy value chain.

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Ongoing visibility into an ever-evolving future is critical. Explore the RBC Imagine™ Preparing for Hyperdrive executive summary now, and you’ll also receive updates and actionable insights to help bring the future into focus for your business and portfolio.