There's no silver bullet for clean energy. We need an all-hands-on-deck approach, writes Scott Nyquist. Photo via Getty Images

People in the energy industry don’t have the Oscars. For us, the big event of the year is CERAWeek — a conference stuffed with CEOs, top policymakers, and environmental and energy wonks held annually in March.

CERAWeek 2022, with the theme“Pace of Change: Energy, Climate, and Innovation," meant the return of in-person activations, panels, and networking. Walking and talking between sessions and around the coffee table, it occurred to me that the unofficial theme of the event was “Maybe now we can find middle ground on energy.” This idea came up time and time again, from all kinds of people.

As with too many other issues, the discussion of the future of US energy has become polarized. On one end of the spectrum are those who want everything renewable and/or electrified by ….. last week, whatever the cost. Their mantra for fossil fuels: “Keep them in the ground.”

On the other end, are those who dismiss climate change, saying we can always adapt and that it doesn’t much matter, anyway. Just keep digging and drilling and mining as we have always done. And in the middle are the great majority of Americans who are not passionate either way, but want to be responsible consumers, and also to be able to visit grandma without breaking the bank.

I believe that the transition toward an energy system that is cleaner and less reliant on fossil fuels is realand will ultimately bring substantial benefits. At the same time, I believe that energy security and economics also matter. At a time when inflation was already running high, paying an average of $4.25 a gallon at the pump is piling pain on tens of millions of US households. Ultimately, over decades, the use of electric vehicles will reduce the need for oil and that lower-emissions sources, including renewables, will provide a larger share of the power supply, which today depends largely on gas and coal. But that moment is not now, or next week. Indeed, fossil fuels continue to account for almost 80 percent of US primary energy consumption, and a similar figure globally.

Here is one way to think about the interplay between the energy transition and energy security: “We need an energy strategy for the future—an all-of-the-above strategy for the 21st century that develops every source of American-made energy.” No, that isn’t some apologist for Big Oil; it was President Obama. In 2014, the Obama White House also noted the role of US domestic oil and gas production in enhancing economic resilience and reducing vulnerability to oil shocks. In short, the White House argued, US oil and gas production can bring real benefits for the country. I think that is still true.

Does that mean throwing in the towel on the energy transition and climate change? Absolutely not. There are a variety of ways to pursue the goal of reducing emissions and eventually getting to net-zero emissions. I’ve touched on many of them in previous posts—including reducing methane emissions,pricing carbon, hydrogen, renewables, electric vehicles, urban planning, carbon capture, and negative emissions technologies. In other words, an “all of the above strategy” makes sense in this regard, too.

I don’t know how, or if, a middle ground can be captured. But from what I heard at CERAWeek last year, from people of otherwise widely divergent views, there just may be momentum to get there. A middle-ground consensus rests on three premises. First, we need fossil fuels for energy security and reliability now and until the time when technologies are in place to secure the energy transition. Second, at the same time, we need to be investing in the energy transition because climate change is real and matters. And third, for sustained and systematic progress, government and industry need to work together.

Or, in a phrase, “all of the above.”

------

Scott Nyquist is a senior advisor at McKinsey & Company and vice chairman, Houston Energy Transition Initiative of the Greater Houston Partnership. The views expressed herein are Nyquist's own and not those of McKinsey & Company or of the Greater Houston Partnership. This article originally ran on LinkedIn.

Ad Placement 300x100
Ad Placement 300x600

CultureMap Emails are Awesome

Oxy subsidiary granted landmark EPA permits for carbon capture facility

making progress

Houston’s Occidental Petroleum Corp., or Oxy, and its subsidiary 1PointFive announced that the U.S Environmental Protection Agency approved its Class VI permits to sequester carbon dioxide captured from its STRATOS Direct Air Capture (DAC) facility near Odessa. These are the first such permits issued for a DAC project, according to a news release.

The $1.3 billion STRATOS project, which 1PointFive is developing through a joint venture with investment manager BlackRock, is designed to capture up to 500,000 metric tons of CO2 annually and is expected to begin commercial operations this year. DAC technology pulls CO2 from the air at any location, not just where carbon dioxide is emitted. Major companies, such as Microsoft and AT&T, have secured carbon removal credit agreements through the project.

The permits are issued under the Safe Drinking Water Act's Underground Injection Control program. The captured CO2 will be stored in geologic formations more than a mile underground, meeting the EPA’s review standards.

“This is a significant milestone for the company as we are continuing to develop vital infrastructure that will help the United States achieve energy security,” Vicki Hollub, Oxy president and CEO, said in a news release.“The permits are a catalyst to unlock value from carbon dioxide and advance Direct Air Capture technology as a solution to help organizations address their emissions or produce vital resources and fuels.”

Additionally, Oxy and 1PointFive announced the signing of a 25-year offtake agreement for 2.3 million metric tons of CO2 per year from CF Industries’ upcoming Bluepoint low-carbon ammonia facility in Ascension Parish, Louisiana.

The captured CO2 will be transported to and stored at 1PointFive’s Pelican Sequestration Hub, which is currently under development. Eventually, 1PointFive’s Pelican hub in Louisiana will include infrastructure to safely and economically sequester industrial emissions in underground geologic formations, similar to the STRATOS project.

“CF Industries’ and its partners' confidence in our Pelican Sequestration Hub is a validation of our expertise managing carbon dioxide and how we collaborate with industrial organizations to become their commercial sequestration partner,” Jeff Alvarez, President of 1PointFive Sequestration, said in a news release.

1PointFive is storing up to 20 million tons of CO2 per year, according to the company.

“By working together, we can unlock the potential of American manufacturing and energy production, while advancing industries that deliver high-quality jobs and economic growth,” Alvarez said in a news release.

Houston energy-focused AI platform raises $5M in Mercury-led seed round

fresh funding

Houston-based Collide, a provider of generative artificial intelligence for the energy sector, has raised $5 million in seed funding led by Houston’s Mercury Fund.

Other investors in the seed round include Bryan Sheffield, founder of Austin-based Parsley Energy, which was acquired by Dallas-based Pioneer Natural Resources in 2021; Billy Quinn, founder and managing partner of Dallas-based private equity firm Pearl Energy Investments; and David Albin, co-founder and former managing partner of Dallas-based private equity firm NGP Capital Partners.

“(Collide) co-founders Collin McLelland and Chuck Yates bring a unique understanding of the oil and gas industry,” Blair Garrou, managing partner at Mercury, said in a news release. “Their backgrounds, combined with Collide’s proprietary knowledge base, create a significant and strategic moat for the platform.”

Collide, founded in 2022, says the funding will enable the company to accelerate the development of its GenAI platform. GenAI creates digital content such as images, videos, text, and music.

Originally launched by Houston media organization Digital Wildcatters as “a professional network and digital community for technical discussions and knowledge sharing,” the company says it will now shift its focus to rolling out its enterprise-level, AI-enabled solution.

Collide explains that its platform gathers and synthesizes data from trusted sources to deliver industry insights for oil and gas professionals. Unlike platforms such as OpenAI, Perplexity, and Microsoft Copilot, Collide’s platform “uniquely accesses a comprehensive, industry-specific knowledge base, including technical papers, internal processes, and a curated Q&A database tailored to energy professionals,” the company said.

Collide says its approximately 6,000 platform users span 122 countries.

CenterPoint reports progress on grid improvements ahead of 2025 hurricane season

grid resilience

As part of an ongoing process to make Houston better prepared for climate disasters, CenterPoint Energy announced its latest progress update on the second phase of the Greater Houston Resiliency Initiative (GHRI).

CenterPoint reported that it has completed 70 percent of its resiliency work and all GHRI-related actions are expected to be complete before the official start of the 2025 hurricane season.

"Our entire CenterPoint Houston Electric team is focused on completing this historic suite of grid resiliency actions before the start of hurricane season,” Darin Carroll, Senior Vice President of CenterPoint's Electric Business, said in a news release. “That is our goal, and we will achieve it. To date, we have made significant progress as part of this historic effort.”

CenterPoint’s resiliency solutions include clearing higher-risk vegetation across thousands of miles of power lines, adding thousands more automation devices capable of self-healing, installing thousands of storm-resistant poles, and undergrounding hundreds of miles of power lines.

CenterPoint's GHRI efforts, which entered a second phase in September 2024, aim to improve overall grid resiliency and reliability and are estimated to reduce outages for customers by more than 125 million minutes annually, according to the company. It has undergrounded nearly 350 miles of power lines, about 85 percent of the way toward its target of 400 miles, which will help improve resiliency and reduce the risk of outages. CenterPoint also aims to install the first of 100 new local weather monitoring stations by June 1.

In March, CenterPoint cleared 655 miles of high-risk vegetation near power lines, installed 1,215 automated reliability devices capable of self-healing, and added an additional 3,300 storm-resilient poles.

In April, CenterPoint will begin building a network of 100 new weather monitoring stations, which will provide 24/7 weather monitoring and storm response preparation.

“We will continue to work every day to complete these critical improvements as part of our company's goal of building the most resilient coastal grid in the country,” Carroll added in the release.