Written by Aberdeen Energy & Innovation Parks
The extremely close links between Aberdeen and the energy industry were established as long ago as 1969, when the first oil in UK waters was located in the Montrose oil field, situated just 135 miles east of Aberdeen. It wasn’t until 1975 that the first British oil was brought ashore, but this triggered the start of the transformation of the UK oil and gas industry as a whole, and the fortunes of Aberdeen in particular. By the mid-1980s the UK had become a net exporter of oil and overall production peaked at 4.5 million barrels of oil per day in 1999. More than 90% of this oil production is based offshore in the central and Northern sections of the North Sea, and the bulk of this was is located in oil fields such as Brent, Buzzard, Forties, Captain and Alba.
Over fifty plus years this boom in the energy sector has led to over 20% of Scotland’s export value being located in Aberdeen and its surrounding areas, and the creation of more than half a million jobs in the local energy industry. At Aberdeen Energy & Innovation Parks we’ve played a huge role in providing the kind of flexible office facilities needed by businesses talking advantage of this uniquely dynamic environment, and we’re fully equipped to play the same role in the newly emerging renewable energy sector. The infrastructure which grew in Aberdeen over this period, allied to the presence of a highly trained and experienced local workforce, will help to make the city a hub for the creation, development and distribution of renewable energy solutions as it was for more traditional forms of energy production.
The events of the past year – and in particular the drop in demand for oil which was triggered by the pandemic inspired global economic slowdown – have provided a microcosm of what will happen as the world turns away from fossil fuel and embraces a low carbon future. During the first wave of COVID-19, for example, the slump in demand led to the price of a barrel of US oil dropping to below zero for the first time ever (minus $38 to be precise), and producers facing the unprecedented challenge of having to pay buyers to take away barrels of oil they could no longer afford to store. While this is an extreme example it does demonstrate the volatility of the oil market and the direct and fast acting relationship between demand and price. It’s for those reasons – as well as a desire to be at the forefront of the global energy market in the years to come – that Aberdeen as a whole is re-inventing itself as a centre for sustainable and renewable energy of every kind. With that reinvention comes a wealth of opportunities for start-ups and small businesses within the sector to relocate to an area which is primed for investment and offers a multi-faceted support structure.
Low Carbon Future
The global shift toward renewables which forms the backdrop of the changes being made in Aberdeen and the surrounding areas is being driven by a pan-governmental commitment to act on what is now widely accepted as being a climate emergency. This response was captured in point 13 of the Sustainable Development Goals (SDG) set by the United Nations in 2013. Point number 13 is summarised as ‘Take urgent action to combat climate change and its impacts’ and it led, among other things, to 196 governments signing the Paris Agreement in 2015. The Paris Agreement itself was a milestone in efforts to deal with the climate emergency, setting out a goal to ‘limit global warming to well below 2 degrees Celsius (preferably 1.5 degrees) compared to pre-industrial levels’ and the UK commitment to this target took the form of 2019 legislation which requires the government to reduce the UK’s net emissions of greenhouse gases by 100% relative to 1990 levels by 2050.
In Scotland in general, and the Aberdeen area in particular, this shift toward low carbon solutions has been reflected in a number of practical steps taken by government and business alike. In June 2020, for example, the Scottish Government set up a £62 million Energy Transition Fund. The aim of the fund is to support the existing energy sector as it recovers from the impacts of COVID-19 and in particular the crash in the price of oil and gas, and transitions to renewable solutions. As well as a general desire to attract private sector funding, the Transition Fund focused on several practical steps, including the creation of an Energy Transition Zone in Aberdeen. The stated aim of the Zone is to create a physical focal point for an industry cluster based on the transition to new forms of energy, leading to a situation in which Aberdeen, for so long a UK and indeed European capital for oil and gas production, could transition to taking the same leading role in the provision of net zero solutions such as offshore wind power and hydrogen and carbon capture.
Ready For Renewable Energy
Although this is a process which has accelerated in recent years, the long term commitment of the Aberdeen area to a renewable energy future is reflected in the fact that the Aberdeen Renewable Energy Group (AREG) was established as long ago as 2003 with the aim of turning the north east of Scotland – with Aberdeen at its heart – into a global centre of excellence for the production and use of renewable energy. Aberdeen Energy & Innovation Parks joined the AREG recognising the key role it is playing and will play in the future economic and business success of Aberdeen. The organisation works to align the skills, expertise and technology which the oil and gas industry have embedded in Aberdeen with the demands and requirements of new and innovative businesses focussing on renewable solutions. The creation of the Energetica Corridor is a physical manifestation of these ambitions, taking the form of a long term programme designed to exploit the natural coastal habitat and environment of the Aberdeen area combined with the presence of technical expertise and entrepreneurial flair attracted over the last several decades of oil and gas production, and to use these two unique assets in order to transition the area into the renewable energy capital of Europe.
Supporting Growing Businesses
The position of Aberdeen Energy & Innovation Parks at the gateway of the Energetica Corridor and within easy reach of the coast and Aberdeen city centre makes it the ideal base for any ambitious new business wishing to play a part in the transformation the next few years will bring. From virtual offices to coworking spaces and on to the provision of fully serviced, large scale facilities and even bespoke premises designed and built from scratch, we can partner with businesses as they grow and succeed through their connection to the renewable energy industry as it becomes an increasingly important part of life in Aberdeen.
As if to underline the inevitability of the shift to renewables, March 2021 saw the UK government sign the North Sea Transition Deal, an undertaking to underpin the oil and gas industry’s transition to clean, green energy, while supporting 40,000 jobs. In practical terms, this focus has already led to Aberdeen being the first city in the world to be served by an fleet of fuel cell electric double decker buses utilising renewable hydrogen power, while plans are in place for the new Cloverhill housing estate. Of the 550 properties in the estate, 150 will be social housing, and each will be installed with a hydrogen-fuelled micro-CHP solid oxide fuel cell capable of 750 W of power and 1.5 kW of heat.
In simple terms, Aberdeen is leading the push for renewables by example as well as ambition, and Aberdeen Energy & Innovation Parks is ideally placed to help more businesses than ever play a part.