Decarbonisation will undoubtedly necessitate strong multilateral cooperation. Information sharing across industry verticals, companies, and between stakeholders is not optional. Multilateral digital twin ecosystems, covering upstream through downstream and beyond, now offer significant opportunities to break down siloes through collaboration, information sharing and the necessary integrated understanding of especially scope 3 emissions to drive energy transition across the complete energy value chain. Ready to work together?
Navigating the narrowing path to limit global warming to 1.5°C amidst growing energy security challenges is for sure an ambitious journey. To execute the necessary pathway, the energy industry must collectively establish an industry-level roadmap that promotes international stakeholder collaboration with dedicated decarbonisation efforts that operate independent of ongoing geopolitical influences.
It is easy to recognise the hard realities of climate change, especially how energy transition demands a rapid rate of adoption of carbon abatement solutions and a substantial increase in renewable energy production. Yet, as the world’s demand for energy grows, the continued production of oil and gas will remain vital. Clean and renewable energy advancements must therefore happen concurrently with responsible and sustainable development of oil and gas resources, and must be scaled to establish reliable and resilient energy systems.
When trying to answer how to balance meeting the world’s increasing energy needs while (as recently noted by ExxonMobil CEO Darren Woods) “bending the curve on emissions”, an opportunity emerges: The intersection between digital transformation and expansive collaboration.
Why is it so important for organisations across the energy value chain to collaborate and coordinate, and in what ways can digital technologies be leveraged?
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The good news is that all these requirements can be solved through the intentional application of digital technology and collaborative, motivated parties.
Few technologies are broad enough in scope to deal with complexities spanning across new and existing wells, facilities, pipelines, vessels, grid systems and intermittent energy sources – each, unfortunately, equipped with its own isolated systems, processes, and insular ways of working.
A digital twin can, especially when applied as part of a larger ecosystem of interconnected twins.
“The key success factor in decoding net-zero? Industry players who support an ecosystem of interconnected twins that form a collective source of truth – connecting not only data between systems and a digital twin interface but also exchanging real-time information for systems within and between organisations.” – Haavard Oestensen, Chief Commercial Officer & EVP, Kongsberg Digital
A digital twin is agnostic and able to ingest the various data sources of the facility, vessel, or equipment in question, and augments this data with sophisticated technologies to meet a broad range of business, operational, and environmental goals.
Once information can flow to the right place to be used by different teams, the data foundation is solidified. The next opportunities after data connections and real-time information flows? Real-time continuous monitoring, emissions tracking, and remediation options for faster, more informed decision-making.
The benefits that follow collaborative platforms are lucrative: operational siloes are broken down, cross-organisational collaboration can flourish and collective goals around shared emissions data and decarbonisation efforts are managed with a data-driven approach.
But you may of course have heard about this before – digitalising operating facilities for improved performance, digital transformation and decarbonization. What is next? Consider an integrated network of digital twins, where the twins are interoperable and exchange data, for example related to how products delivered from upstream to downstream impact downstream emissions; or, how facilities upstream must produce to achieve a delivery plan to be consumed into a midstream or downstream facility.
In a connected twin environment with interoperability standards, API availability, and data standards, a world where real-time emissions reduction amongst parties – aided by large language models, cross-facility supply-demand balancing algorithms, and optimization for energy reduction – become a matter of choices made by stakeholders rather than technological limitation. The point: Collaborative industry stakeholders who are serious about net zero ambitions can grab the opportunity to integrate with their value chain partners in this way. Ecosystems of digital twins may surface as a key enabler in optimising for emissions reduction at the industry level.
Does all this provide a compelling basis for exploring additional investment in an industry already struggling to attract significant inflows? Considering recent changes in energy security, an energy mix will remain essential throughout the transition to cleaner and more intermittent energy sources. Hydrocarbons will remain relevant due to existing infrastructure, economic considerations, and the challenges of completely replacing them with alternative resources.
A study by the Climate Policy Initiative evaluated the cost of capital for climate projects based on a shortlist of 47 EMDE (Emerging Market and Developing Economies) countries. Considering the 2030 solar installation targets set by the governments of each of the shortlisted countries, the study found that a total of ~USD 175 billion of capital will be needed, of which 70% (USD 120 billion) would be debt.
Now, consider this: the cost of capital actually increases from solar PV to onshore wind and offshore wind power, meaning that other renewable energy sources will cost even more. The promise to deliver a lower carbon energy system comes at an incredibly high cost for emerging markets that collectively house approximately 85% of the world’s population (around 6 billion people).
Oil will remain a vital part of the energy mix in the medium term and possibly beyond. Despite this, achieving net zero is possible by directing technology towards helping companies reduce their emissions through more efficient, resilient, and data-driven operations.
The investment in digital itself may seem substantial but is hugely overshadowed by the annual investment requirements of USD 45 billion to ensure modern energy systems by 2030. The long-term soft and hard savings of digital performance models warrant further investment into existing and new energy ventures, proving the immense potential of technology to reduce emissions and free up cash flow through improved uptime, better resource utilisation, and the availability of operational transparency and insights.
Did you know? The worldwide Digital Twin Market generated USD 9.5 billion in 2022 and is projected to attain USD 274.2 billion by 2032, with a compound annual growth rate (CAGR) of 40.5% from 2022 to 2032.
For a workflow like condition-based monitoring through proactive technical monitoring (PTM) a digital twin can guide a business to a systematic approach that converts ways of working from reaction to prediction – even for remote monitoring from onshore. Unplanned downtime is reduced significantly, resources are deployed on an as-needed basis depending on data-based maintenance schedules and dollars saved can be measured per service cycle.
From a value chain perspective, workflows like this can tie your operational performance to financial performance in a way that is measurable across the business. It will take more than just digital transformation. True transformation and technology adoption need processes mapped, routines redefined, processes re-engineered, governance, metrics, and more – it’s a journey. But when the results become visible, financially and in terms of emissions reduction, your technology investment becomes a catalyst for further investments in intermittent and new energy sources that will shape the future of the energy landscape.
Within these segments of the value chain, digital twin technology can specifically target the below challenges by offering workflows that are user-friendly and mask the complexity of data through visualisation, dashboards and information that can be filtered according to operational goals, a user’s role and even a specific pain point like estimating the remaining useful life (RUL) of a selected piece of equipment.
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From upstream to downstream, the Industrial Work Surface can help you balance net-zero priorities and deal with the increasing complexity of energy systems – for businesses, people, and the environment. See what it can do for you.
