DOE’s Granholm Encourages Role for Oil and Gas Industry in Energy Transition

Jennifer Granholm delved into specific roles the oil and gas industry can play in the energy transition during her first public remarks as head of the Department of Energy (DOE) on March 2.

“It’s clear that we want to have energy security,” Granholm said at CERAWeek by IHS Markit. “It is a must. And so the question really is about how to decarbonize. So many of the DOE labs are focused on this technology, both demonstrating it and, we hope, taking it to scale in partnership.”

During a virtual conversation with IHS Markit Vice Chairman Daniel Yergin, Granholm pointed to how valued upstream skill sets possessed by frack crews, seismic and geophysical contractors, and engineers can help with the development of alternative sources.

Read: Senate Approves Biden’s Pick Jennifer Granholm to Head Energy Department

For example, an oil and gas company seeking ways to diversify into new energy sources may be able to rely on its own intelligence to identify locations of geothermal hot spots, she said. “Oil and gas engineers’ experience can improve operational efficiencies in geothermal well construction and reservoir development and management.”

The former Michigan governor is familiar with transition. The automotive industry, a huge economic driver in the state, is in the process of shifting production from gasoline-powered to electric-powered vehicles.

“I’m not going to sugarcoat how hard transitions are,” she said. “I saw it first-hand as governor. When people have lost their jobs through no fault of their own, they only want to be given an opportunity to succeed. That requires job providers being located in those communities.”

DOE’s Arsenal

Granholm promised DOE would be “one of our government’s most fierce fighting forces as we pursue this goal of a carbon pollution free economy.” The department has an array of tools that can be used in the effort:

Research: DOE operates 17 national laboratories that are pursuing technological innovations tied to the energy transition. At Oak Ridge National Laboratory in Tennessee, researchers designed and built an aluminum device to more efficiently capture CO₂. The device, manufactured on a 3-D printer, removes excess heat while keeping costs low. At Argonne National Laboratory near Chicago, the Joint Center for Battery Storage Research is working on next-generation batteries that are twice as energy dense as those in service today.

Application: DOE’s applied energy programs include renewables, carbon capture sequestration and utilization, hydrogen, grid technology and storage.

Funding: The department’s Advanced Research Projects Agency–Energy program, or ARPA-E, which seeds new technologies, is back in business. Among the projects funded are seaweed farming drones to make biofuels and more efficient solar arrays that use compressed air. The agency has $100 million to support transformative energy products and projects.

Loans: DOE’s Loan Programs Office will offer billions in investment dollars this year. Granholm announced that Jigar Shah, an expert on market-driven solutions for climate change, will run the office. This is the agency that provided funding to launch Tesla.

Jobs: The department’s new Office of Energy Jobs will be geared toward placing workers from the construction and skilled trades and engineering sectors, as well as the coal, oil and gas industries, into new clean energy jobs.

“It’s going to help us figure out how to create all kinds of jobs for all kinds of people in all corners of the country, corners that have long felt unseen,” Granholm said. “This is our opportunity to build our energy economy back better in a way that lifts up communities that have felt unseen or abandoned or left behind too long.”

Competition for Investment

President Joe Biden’s climate goals for the U.S. are ambitious: a carbon pollution-free power sector by 2035 and net-zero carbon emissions by 2050. On a global scale, achieving net-zero could require investment of $50 trillion over the next three decades in the areas of renewables, electric vehicles, carbon capture and storage, hydrogen and biofuels, according to Morgan Stanley.

Granholm’s take: “It is a heck of an economic opportunity.”

The question, she asked, is where those investment dollars will go. Competitors like China will be fighting hard to dominate this market. Anything short of Biden’s all-in approach is the equivalent of bringing a knife to a gunfight.

“For too many years, we have watched as others created economic opportunity for their citizens while we stood on the sidelines,” Granholm said. “No more.”