Betting on biofuels
Chevron CEO touts biofuels as part of its renewable energy efforts
As Chevron Chairman and CEO Mike Wirth surveys the renewable energy landscape, he sees the most potential in biofuels.
At a recent WSJ CEO Council event, Wirth put a particular emphasis on biofuels—the most established form of renewable energy—among the mix of low-carbon energy sources. According to Biofuels International, Chevron operates nine biorefineries around the world.
Biofuels are made from fats and oils, such as canola oil, soybean oil and used cooking oil.
At Chevron’s renewable diesel plant in Geismar, Louisiana, a recent expansion boosted annual production by 278 percent — from 90 million gallons to 340 million gallons. To drive innovation in the low-carbon-fuels sector, Chevron opened a technology center this summer at its renewable energy campus in Ames, Iowa.
Across the board, Chevron has earmarked $8 billion to advance its low-carbon business by 2028.
In addition to biofuels, Chevron’s low-carbon strategy includes hydrogen, although Wirth said hydrogen “is proving to be very difficult” because “you’re fighting the laws of thermodynamics.”
Nonetheless, Chevron is heavily invested in the hydrogen market:
- The company produces about 1 million metric tons of hydrogen per year
- According to Zach’s Research, the company tentatively plans to build a $5 billion plant in Port Arthur to produce and store low-carbon hydrogen and ammonia
- In 2023, Chevron acquired a majority stake in the $1 billion Advanced Clean Energy Storage (ACES) Delta hydrogen storage project in Utah
As for geothermal energy, Wirth said it shows “some real promise.” Chevron’s plans for this segment of the renewable energy industry include a 20-megawatt geothermal pilot project in Northern California, according to the California Community Choice Association. The project is part of an initiative that aims to eventually produce 600 megawatts of geothermal energy.
What about solar and wind power?
“We start with things where we have some reason to believe we can create shareholder value, where we’ve got skills and competency, so we didn’t go into wind or solar because we’re not a turbine manufacturer installing wind and solar,” he said in remarks reported by The Wall Street Journal.
In a September interview with The New York Times, Wirth touched on Chevron’s green energy capabilities.
“We are investing in new technologies, like hydrogen, carbon capture and storage, lithium and renewable fuels,” Wirth said. “They are growing fast but off a very small base. We need to do things that meet demand as it exists and then evolve as demand evolves.”