Tracey Shelley says engineering contractors need stability to implement climate change solutions
Refer back to a distant place where the world seemed to reach a consensus on the need for unified action on climate change.
Barack Obama flew in from Washington. David Cameron has crossed the Channel and Angela Merkel has just arrived from Berlin. Oil prices are around 50 USD/bbl and are falling. Interest rates hover just above zero, and discussions of inflation are confined to economic history articles. The level of CO2 in the Earth’s atmosphere is below 400 ppm on a good day. This is a time before Covid, before Brexit, before Trump and before the invasion of Ukraine.
It was the backdrop to the ‘historic’ climate change conference where world leaders agreed that human economic activity had to change to limit global temperature rise to 1.5ohC. This distant place was Paris in 2015.
Seven years later, it has been impossible to visit serious news websites without encountering bleak analyzes of climate change policy failures. Inevitably, this happens when a policy is agreed upon without a practical plan to implement that policy; But what do I know? I’m just an engineer.
What I do know is that the success of engineering delivery is highly dependent on the ability to understand the big picture. I also recognize that in highly unpredictable environments, such as the one we find ourselves in today, it is sometimes easier to hang on and keep doing what you have always done.
This is an increasingly risky strategy in any sphere of industrial activity, and at BCECA we try to avoid falling into this trap. Engineering contractors understand the importance of sticking their heads over the parapet from time to time. It is essential to gather the most complete explanation possible of what is happening around you. While a change of direction can be painful, it’s usually a smart move, especially when all the signs tell us disaster is imminent.
For some, decarbonization is an inconvenient obligation; but I think that the Paris conference said things well. So what was wrong?
For some, decarbonization is an inconvenient obligation; but I think that the Paris conference said things well. So what was wrong?
A Difficult Client Called Planet Earth
Before attempting an analysis and advancing solutions, it is important to clarify the scope within which engineering contractors – large and small – must operate. BCECA members have been providing energy infrastructure globally for more than half a century, but we don’t decide what will be built. This decision is ultimately up to the client. We can offer advice and assistance based on our extensive knowledge and experience in designing and delivering projects around the world. Yet the client ultimately decides what they want to build, where and when it should be built, and how much they are willing to pay for it.
However, in this case, the customer seems to be a thing called “Planet Earth” and while our politicians often claim to know what is best for the planet, it is a shame that no one has yet come up with some form of contract that can quickly and efficiently providing a project solution to this client’s particularly challenging problem. The solution can be summed up in two words: “energy transformation”, but the challenge is much more complex than that.
In October, BCECA brought together a wide variety of stakeholders for its second virtual annual conference to discuss the challenge of energy transformation. We will publish a detailed report before the end of the year, but in the meantime, here is a brief overview of the main themes that emerged from the conference.
While our politicians often claim to know what’s best for the planet, it’s sad to see that no one has yet found a form of contract that can quickly and efficiently deliver a project solution to this particularly tricky client problem.
Policy
There is an urgent need to get the Energy Bill stalled in the UK Parliament out of the tall grass and put it into law. We need a coherent legislative framework to get things moving. BCECA will make representations to BEIS. We know governments are reluctant to pick winners, but unless they do more to support the achievement of decarbonisation, the UK will be the loser. We minimize the risk of delay at our own risk.
Finance
The future of hydrogen looks bright, but we need workable off-take agreements and certainty about capital allocations. All parties have to get used to being much more uncomfortable. This means that we need to work more collaboratively to agree risk-sharing mechanisms. BCECA will continue to facilitate discussions with potential investors, financiers and operators. Hydrogen may be in its infancy, but UK-based engineering contractors will help it mature.
Workforce
The supply of skills is a significant barrier to progress. BCECA member companies already recognize this and interesting solutions are being explored. Nevertheless, we need much more flexibility in recruitment and working practices if we are to hire and retain the people needed for decarbonization. The opportunities for the next generation of engineers, technologists and scientists are tremendous. BCECA will continue its work with young professionals – especially women and those from BAME communities.
We need a lot more flexibility in recruitment and working practices if we are to hire and retain the people needed to decarbonize
These were our first conclusions, but do not take my word for it. Please find time to listen to the conversation and formulate your conclusions and ideas for the way forward.
As I write this we are enjoying an exceptionally warm autumn in the UK. It may just be “the weather”, but the CO2 level in the atmosphere is 416 ppm and rising. By the time you read this, world leaders will have gathered again in Egypt, and we may have heard warmer words about the need for unified action. This action will not take place without the professional expertise of the design, procurement and construction engineering communities in the UK and elsewhere. Without stability, progress will be further delayed.
BCECA is the trade organization representing UK-based engineering contractors and their supply chain partners. To get involved and access a range of free resources, including a recording of proceedings from the Second Annual Virtual BCECA Conference, The challenge of energy transformationvisit www.bceca.org.uk
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