Can we achieve the energy transitions without relying on fossil fuels and outdated technology? 

Recently, the photograph below made the rounds of LinkedIn and various industry chat rooms and created a decent amount of discussion – some positive and some not so much.  The photograph depicts one of the largest EV charging stations recently completed in the United States. This particular station, the Harris Ranch Tesla Supercharging Station, is located along Interstate 5 in California’s Central Valley and has the capacity to charge 98 electric vehicles simultaneously.  It was not the existence or the capacity of this station that made it newsworthy but rather the assertion that it was being powered by diesel generators - the connotation being that one of renewable energy’s recent triumphs couldn't exist but for fossil fuel support. The Internet, as is its way, of course took a calm and even-handed approach while debating the merits behind these facts.  It is difficult to sort through the actual facts of this instance but while it does appear that there are diesel generators on site it is believed that they are only there for backup in case of unplanned outages and support during peak demand times. Tesla has pledged that 100% of the electricity used to power its charging stations throughout the United States will be powered by renewable energy sources.  At present, this charging station is connected to the larger California electric grid which is fed by multiple sources of electricity.

Sadly, what was lost in the discussion was the notion that the current and ongoing global and domestic energy transition actually should and does require support from both existing and new technologies.  This transition will take time to accomplish and will require years of financial and material support as well as cooperative intellectual and personnel exchanges between the oil & gas and renewable energy sectors.  In many ways, these exchanges are already occurring.  Most oil & gas companies of any scale are either creating in-house renewable development teams or are investing heavily in third-party actors already operating in the renewable energy sector with a view toward fully acquiring these entities once certain targets are met.  Vitol Group, the world's largest oil trader, announced plans this week to commit fully half of its $2 Billion 2024 capital expenditure on renewables.  This decision was announced concurrent with their expectation that oil prices will remain stable in the $80 to $90 range next year, so their decision to shift the focus of half their capex wasn’t made out of duress.

Take, for instance, another transition that swept over the United States in the Twentieth Century – the shift in transportation from actual horsepower to mechanical horsepower.   Automobiles, as we would recognize them today, were designed and engineered in the latter decades of the Nineteenth Century, but they were slow to build and expensive.  This prevented adoption on a wide scale.  The first mass-produced car, Ford’s Model T, was not produced until 1908, but even that event did not lead to the immediate adoption of the automobile as the primary source of transport for all Americans.  Indeed, it was not until the year 1979 that there were half as many cars registered throughout the United States as there were people living within its borders.  In 1979, there were 118,500,000 cars registered throughout the United States against a population of 227,339,000 – representing an adoption rate of 52.12% (See graph below for a visualization of the adoption of the automobile in the U.S).  This means that even after a process had been worked out to mass produce the automobile at a price possible for the middle class American to afford, it still took seventy-one (71) years for half of Americans to own a car.  During that same period the nation fought two world wars, created the polio vaccine, and landed twelve astronauts on the moon.  Transitions take time, they do not occur instantaneously.   

What lies ahead for the future of renewable energy? 

The most optimistic renewable industry predictions forecast that by the year 2050 half of all electricity demand in the United States will be generated by renewable energy sources. Read another way, that means that at least half of demand twenty-five years (or an entire generation) from now will still be generated through existing, non-renewable power sources.  There will no doubt be some areas in which local project demands prohibit inter-sector cooperation, but in most instances, the various industries can not only coexist but can actually work together in a mutually beneficial manner.  Rather than sowing indifference or animosity, it would benefit all industry participants to work together and find a way to build bridges when and where possible. 

In order to allow the EV charging station described above to operate, power is routinely drawn from California's electric grid.  Currently, that electricity is produced by coal-fired and biomass power plants, by natural gas power plants, by solar and wind farms, and by three active nuclear power plants within the state's borders.  To facilitate this power generation, miles of oil and gas pipelines are necessary to gather and transport the raw fuels to the power plants, and miles of electrical transmission lines are required to take that electricity and distribute it to, among other destinations, the Harris Ranch Superstation.  Many of the key components of the grid and charging infrastructure require vast quantities of metals and minerals such as nickel, copper, lithium, cobalt, and others which were once mined almost exclusively offshore.  In an effort to control and safeguard these supply chains, mining operations for many of these metals and minerals are being on and near shored when and where possible.  The Harris Ranch Superstation, and many others across the United States like it, are not merely symbols of triumph for the renewable energy sector, they are rightly another step in the transition taking place within the energy industry as a whole.

Percheron's pivotal role in driving the transition:  

Each of the industries described above has an important role to play in making sure that when an electric vehicle pulls into the charging station the necessary electricity is present and ready to restore its battery power.  Percheron, as a service provider to many of the industries listed above, plays a role in many of these projects. Whether it's helping to lease or clear title prior to the drilling of an oil or gas well, securing the rights necessary to lay a new pipeline or for a new electrical transmission run, or securing a location for a solar or wind generation site, Percheron is a part of this process. Its land professionals, abstractors, surveyors, GIS technicians, and engineers work across multiple industries to help ensure that when that electric vehicle pulls up to a charging station there are electrons ready and waiting. Those same individuals at Percheron work equally hard to ensure that when an internal combustion car pulls up to a gas station there's fuel in the pump.  This model of cooperation will serve Percheron and its clients and partners well as both the global and domestic energy markets continue to transition in the coming decades. 

By: Vincent A. Caruso, Jr., JD, RPL

Vincent Caruso is a Managing Director for Percheron, LLC, with 19 years of experience in the Renewable Energy, Oil & Gas, and Hard Mineral sectors. He has extensive expertise in complex land identification, development, and acquisition projects. Vincent holds a Bachelor’s and Master’s Degree from Fairfield University and a Juris Doctor from the University of Richmond. In his free time, he enjoys landscape photography and traveling with his family throughout the United States and Canada. Vincent also coaches his son's baseball team and serves as chairman of the local Cub Scout Pack.