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Do the research

Speech given by Matthias Bichsel, Projects & Technology Director, Royal Dutch Shell plc, at the European Intersectoral Summit on Research and Innovation, Trinity College, Dublin on February 25, 2013.
Matthias Bichsel

At an EU conference on the role of media in responsible research and innovation, Matthias Bichsel, Shell’s Projects & Technology Director, argues that questions of energy policy must be resolved through fact-based debate. Research helps policmakers, technologists and journalists get the fundamental facts. On the basis of those facts, the public and private sectors can then collaborate to drive forward the energy-related innovation that society needs. The transition from small-scale development to large-scale deployment needs particular care. The media’s role is to keep everyone honest.

Do the research

Good afternoon, everyone. I’m very pleased to take part in this summit – especially in these impressive, historic surroundings.

I wish the Irish Government continued success in its presidency of the European Council. I know it’s progressing a number of key issues around energy and technology. Shell looks forward to contributing to this work.

As director of Shell's global Projects and Technology organisation, I must ensure that all of Shell’s activities have the technology capabilities and expertise they need. I also oversee safety and environment across the Shell group of companies.

So responsible research and innovation are right at the centre of my radar screen.

Today I want to highlight the importance of good research for responsible innovation – and for responsible communication about it.

This might seem like a truism. But experience shows – time and again – how poorly researched news reporting can curb the political appetite to implement the necessary policies to capitalise on innovation.

I also want to highlight the need for a proper understanding of innovation: not just great ideas in the lab, but something that gets deployed in the field to add value to business, the economy and society.

Role of research

Research for innovation is vital in the energy industry. I’m talking about targeted, objective research that benefits stakeholders across the board. Without it, the EU would not have the innovations it needs to address the very ambitious decarbonisation agenda in the coming decades.

But what we read or hear about these innovations doesn't always do them justice.

Here’s one example: carbon capture and storage, or CCS. The International Energy Agency has said that, if CCS is progressed rapidly, it could account for 19% of the CO2 reduction effort that’s globally needed by 2050. The IEA has also said that, without CCS, the cost of tackling climate change could be 70% higher.

Yet several EU member states have stepped back from supporting CCS, even though it involves proven technologies – and now just needs support for demonstration and deployment on a commercial scale.

In the UK last month, the Labour party accused the Government of cutting its pot for supporting commercial-scale CCS projects by 80% over the next few years. The EU's NER300 scheme supporting CCS and renewables projects is also reported to have shrunk – from €6 billion to less than €1.5 billion – because of the low CO2 prices.

Disappointingly, in the first round of NER300 funding announced last December, all the €1.2 billion allocated went to 23 renewable-energy projects. Not a single CCS project benefitted.

Don’t get me wrong. The EU will undoubtedly need renewables. So it’s good those projects got funding. But renewables alone will not be enough. Nor might they be the cheapest way to decarbonise energy.

In 2050, even with rapid growth in renewable energy sources, fossil fuels are still likely to provide the majority of global energy.

Indeed, the re-emergence of coal as a fuel of choice for power generation in Germany is particularly worrisome. The growth of coal without CCS can only hinder progress towards emissions reduction targets, and has serious implications for climate change.

The time for action is now. There needs to be funding support for CCS demonstration projects; and an appropriate carbon price to ensure CCS deployment. Additional measures are needed to compensate for the reduced value of the allowances to be auctioned from the NER. And collectively, we need to promote knowledge sharing and collaboration within the EU and internationally. This will help to capture the best engineering value in CCS demonstration projects, and push deployment costs down.

The EU requires a balanced, fact-based debate on CCS as a matter of urgency. And good research is vital to fuel that debate.

Role of innovation

Obviously, research also fuels the ongoing innovations themselves. Shell spends over $1 billion a year on R&D. We’re at the top of the Patent Scorecard in the energy and environment sector. We’re on last year’s MIT Technology Review list of the 50 most innovative companies in the world, and this year’s Boston Consulting Group list.

But innovation is not just about having good ideas. It’s about turning good ideas into reality, at the pace and quality required.

In Shell, we spotted a bottleneck in our own organisation at that critical juncture between laboratory-scale R&D and large-scale commercial deployment. We now recognise that, even in the early stages of technology development, it’s essential to tackle head-on questions about scalability, replication and standardisation.

In the UK, the Energy Technologies Institute brings together global companies and government to make targeted investments in projects that bridge the gap between development and deployment.

Something similar is called for across the EU. We need a better handover from small-scale development to large-scale deployment. And that requires sustained investment and close collaboration between the public and private sectors.

On this issue, again, informed debate is needed – urgently.

Role of media

Academics play an important part in such debate. They do much of the necessary investigation. And generally, the public trusts them more than they do businessmen, politicians or journalists.

Nevertheless, the media also shape public debate.

As the EU works towards an energy and climate-change framework for 2030, the media will question many things: the role of renewables; the role of natural gas; emission targets; funding for the transition to a low-carbon economy.

I firmly believe in freedom of the press. It is a right, but also a great responsibility. There are many admirable, responsible journalists and news editors around the world. The less professional or accomplished ones are like football hooligans – few in number, but they’re the ones everyone notices.

Online or offline, mainstream or specialist – the media have a duty to properly frame debate: To make sure government officials and business leaders answer the right questions, using facts rather than opinions or uninformed theories. They must also hold policymakers accountable for their promises to deliver a cleaner, broader, more efficient energy system – which means supporting lab-based innovation and scaling up and commercialisation.

Shell believes the best incentive for cost-effective reduction of greenhouse gas emissions is an overarching target, supported by a strong Emission Trading Scheme.

Yes, ETS prices have collapsed recently, partly because of the economic downturn. But we should not ignore the impact of overlapping policies for energy efficiency, renewable electricity, transport biofuels and so on. Nor should we ignore how the ETS price collapse has led to natural gas being squeezed out in favour of coal in the EU, as I mentioned.

Conclusion

To conclude: Well-researched innovation can drive the global energy system forward at the required pace and with the desired environmental, economic and social performance.

Media, government, business, academia and society – all have roles in making this happen. And all have the responsibility for ensuring they are properly informed through research – good research – so that they can carry out their roles.

I look forward to the upcoming exchange of views.