– The defining challenge opportunity of our time

Without energy, the world would simply stop. But the energy system must change. Does a future exist where we can ensure enough energy for everyone, while also being good stewards of our planet? At Equinor, we believe that the answer is yes! By 2050, we aim to become a net-zero company, delivering the energy the world needs without contributing to global warming.

Norway Energy Hub

Norway Energy hub is Equinor’s industrial plan for Norway’s future energy industry, placing Norway at centre stage in accelerating the energy transition.

The plan can lead to 350 billion NOK in investments from the private sector. Equinor estimates that we will invest around 100 billion NOK under this plan.

This is the energy transition

Since the industrial revolution, when machines and fossil energy gradually replaced traditional trades and manual labour, the volume of CO2 in the atmosphere has increased by nearly 50 percent. And greenhouse gas emissions just continue to accelerate. The world has had a dawning realisation over the last couple of decades about the negative consequences this entails.

Climate change means that we must change the way the world produces and consumes energy, to eliminate harm to our society and the natural environment. We must transition away from fossil energy sources to renewable ones, and greenhouse gas emissions must be slashed.

The question we ask ourselves in Equinor is: “What will it take to bring about a successful energy transition for the world, and what role can Equinor play?”

“Our task in the coming decades will be to contribute to the transition from fossil fuels to other forms of energy, while continuing to create value.”

Anders Opedal, CEO Equinor

The job that has to be done is bigger than any one company, any single industry or any one country on its own. This is an endeavour that is described as the defining challenge of our time: “How do we ensure enough energy for everyone, while also solving the climate challenge?”

This is the equation we must solve

Today, nearly 80 percent of the energy the world uses comes from fossil sources. This cannot continue. At the same time, we know that the world will have to support many more human beings in the future, and we want to make sure that as few of us as possible live in poverty. Such a vision means a world that will demand even more energy than today.

In other words, while we work to replace more and more fossil energy with renewables, we will also have to produce more energy overall.

That means a complete change-over of the entire energy system on which our society is built – in the space of just a few decades.

And the clock is ticking.

 

These are some of the dilemmas

Just how fast can we implement the energy transition?

Even the most ambitious scenarios conclude that we have a long way to go. In the current scenario, we lack both the necessary technology, infrastructure, development areas and financing to achieve the energy transition. And it’s going to take global cooperation on a scale the world has probably never seen, across industries, borders and political divisions.

There is no shortcut to the finish line. There is no one perfect solution, nor do we have time to wait for one.

We have to be able to walk and chew gum at the same time. And we have to start doing what we can do right now.

Total global energy production
Source: IEA
Population growth, historical and expected
Source: United Nations DESA Population Division

This is our ambition

Equinor supports the Paris Agreement. It dictates that global warming must not exceed 2 degrees by the end of the century, and that all nations must do what they can to limit the temperature increase to 1.5 degrees.

Therefore, our ambition is to become a net-zero company by 2050. In simple terms, being net zero means that we have to match our own emissions with equivalent emission cuts – both from our own operations and from the use of our products.

Working to achieve our ambition, we will be helping to solve the enormous challenge the world is facing, while also positioning ourselves for future value creation and growth. 

We welcome challenges at Equinor. Because challenges mean opportunities. And we intend to seize this opportunity. We are confident that Equinor has an important role to play in the energy transition, and we want to take a leading role. 

IEA Net Zero Report

In May, the International Energy Agency (IEA) presented a report outlining a pathway for how the world can achieve its ambition of net zero emissions by 2050. Among other things, the report presents the need for a drastic decline in fossil fuel consumption and no development of new oil and gas fields after 2021.

The main message in the IEA report is that a climate-neutral world is possible, but that it is enormously demanding.

How does Equinor view the IEA's net-zero scenario?

Equinor’s ambition is to become a net-zero company by 2050 and take a leading role in the energy transition. Our strategy is our roadmap to achieving these ambitions. As part of this, we assume that the energy and climate policy needed to reach the 1.5-degree target works. 

This report is an important contribution to our work, but as a company we cannot assume that the future has only one possible outcome. That would be too high of a risk to the business. Therefore, we test all decisions against several possible scenarios to ensure that they are profitable and sustainable. 

When we stress-test our business, we assume, for example, that there may be a significant drop in demand for oil and gas in the future and that the oil price could be much lower than today. We therefore plan for projects and products that ensure value creation also in a carbon-neutral future. 

Through Energy Perspectives, Equinor each year prepares three scenarios for the world's future energy markets. Here you can read more about Energy Perspectives 2021 and how our analyses are compared with the IEA's net-zero scenario. 

The ambition is clear, and the direction is set. For Equinor’s corporate executive officer Anders Opedal there is no doubt. Equinor has an important role to play in the profound transformation that the world is now undergoing.  

“Discovering in 2030 or 2035 that: 'Sorry, other energy forms are in demand now' will be too late. You might as well pack up and turn off the lights."

This is how

There are few countries and companies that are in a better position to succeed in the energy transition as Norway and Equinor. We have built a veritable industrial fairy-tale on the shoulders of previous generations’ knowledge and success before, and we can do it again.

We have selected three areas where we will focus our efforts:

Continue to cut greenhouse gas emissions from our own production of oil and gas

Develop and work towards even faster growth within renewable energy

Develop solutions to remove CO2 from the atmosphere and industrial processes

These three areas are closely linked and mutually reinforcing. We will use our offshore expertise to develop new low-carbon solutions. Renewable energy will help cut emissions offshore. And profit generated from oil and gas activity will be used to invest in renewable projects.

Interaction between these focus areas will be crucial to Equinor’s success. And interaction and teamwork between all the initiatives and the efforts made by each company, individual or nation will be crucial for whether or not the world succeeds in this task.

The energy transition is our most important task. That’s why Equinor will continue with oil and gas.

This might sound like a contradiction. But why can’t we just stop oil and gas production? And what will the energy transition look like on the Norwegian continental shelf?

Equinor’s largest industrial project today is not an oil platform, but an offshore wind farm

The transition to a low-carbon society requires solid growth in renewable energy. Equinor’s production of renewable energy will increase tenfold over the next five years.

Net zero. The goal is simple. The solution is complex.

Like many other nations, Norway is supposed to be a low-emission country by 2050. Net zero means that we have solutions to eliminate or neutralise greenhouse gas emissions. But how do we get there

The energy transition + politics

In this special from Arendalsuka – Norway's largest annual political gathering – we discuss the most important challenges both the industry and politicians are facing in the energy transition with the party leaders of Norway's largest youth parties, AUF leader Astrid Hoem and Unge Høyre leader Ola Svenneby.

In Equinor’s podcast series, we invite in external voices and discuss the opportunities, challenges and dilemmas we and the world are facing when we together work to achieve the goals set in the Paris Agreement.

Photos and videos on this page are from Equinor ASA, Unsplash.com and Videezy.com