Posted April 26, 2018
During recent visits to three universities, my goal was to have conversations with students who might be part of the next generation of the energy workforce – talking with them about energy, global markets, the potential for rewarding careers and the advanced technologies we use to safely and responsibly develop the energy our country needs to grow its economy and increase its security.
I visited with 110 graduate and undergraduate students at the University of Pennsylvania, Tulane (photo below) and Rice universities – many of whom hope to work in the energy industry, and others who recognize the ways energy affects careers in manufacturing, finance, trading and other fields. I emphasized three main points:
- Energy is in everything and is essential to both the U.S. and global economies. Natural gas and oil, our country’s leading sources of energy, are not only fuels, they are also the building blocks for countless products that make modern life possible and convenient – as well as technologies that meet some of our greatest challenges.
- Thanks largely to U.S.-based natural gas and oil companies and their innovation, today we can discover, produce, transport and store energy more safely, efficiently and environmentally responsibly than ever before; and,
- Supplying the energy the world needs equates to more economic opportunity and rewarding careers.
It all begins with the global economy and the inextricable linkage between economic and energy growth. Although emerging economies are likely to account for the vast majority of anticipated energy demand growth, the U.S. accounts for 17 percent of global energy demand and is expected to sustain similar levels between now and 2040. Therefore, even if our country’s demand doesn’t increase, U.S. energy will remain critically important. We also discussed the massive scale of global energy demand and how not all forms of energy are created equal for all end uses.
The most common question I heard concerned why most energy outlooks do not show greater energy efficiency gains in the industrial sector. While many people envision energy as being used only for fuel or electric power, it is important to remember that natural gas and oil are fundamental to thousands of materials and finished goods for which consumers around the globe have a voracious appetite as their incomes rise.
For example, if you have a cell phone or another device, the odds are that roughly half of that is natural gas and oil, in one way, shape or form. Materials and derivatives from natural gas and oil also are built into everyday products and enable desirable performance characteristics – such as materials that are strong, yet light and flexible with a pleasing texture.
Students also were interested in learning about cutting-edge energy solutions, such as electric and autonomous vehicles as well as renewable energy sources.
To illustrate America’s energy requirements, I provided a breakdown of the U.S. energy mix in 2017 and how the U.S. Energy Information Administration expects that mix to look in 2040:
- Today natural gas and oil together supply two-thirds of U.S. energy needs; coal about 15 percent; nuclear just under 9 percent.
- Renewables such as biofuels, wind, solar and hydropower account for roughly 11 percent of today’s energy use. While renewables are the fastest growing segment, they start from a very small base. Even sustaining high growth over time doesn’t come close to meeting the massive scale of our country’s energy needs.
- The transportation sector today depends on liquid fuels for about 90 percent of its energy. The electrification and potential automation of vehicles is a hot topic, yet it will take a highly aggressive combination of technological improvements, successful testing and commercialization for those technologies to significantly change markets of such large scale. In addition, electrification of the vehicle fleet depends on the power grid, which in turn relies heavily on natural gas and is expected to do so for decades to come.
Not surprisingly, jobs were top of mind for many students. Natural gas and oil currently support 10.3 million jobs – including a supply chain of service companies, contractors, suppliers, equipment manufacturers and more.
Based on Census data, many natural gas and oil-related jobs pay $50,000 more than the U.S. average per year – and as much as 10 times the federal minimum. These are the kinds of jobs that Americans need to sustain a high standard of living and maintain leading positions in science, technology, engineering and mathematics. They also are the kinds of jobs that cannot easily be outsourced. In fact, this generation of U.S. energy workers is likely to have increased opportunities globally because the energy renaissance holds tremendous potential to spread across other continents in the coming decades.
Meeting these students in Philadelphia, New Orleans and Houston was inspiring. One of my biggest takeaways was that they are curious about energy and recognized that energy has broad effects no matter what job or career they pursue. American energy is achieving new records that most people thought were impossible just a few years ago, and it’s exciting to share this message and see students’ proverbial wheels turning with an increased understanding of the enormity of the challenges and opportunities that the energy industry presents. There’s never been a more interesting and important time to be in the energy industry!
ABOUT THE AUTHOR
Dr. R. Dean Foreman is API’s chief economist, specializing in energy and global business. With a Ph.D. in economics from the University of Florida, he came to API from Saudi Aramco Strategy & Market Analysis in Dhahran, where he managed short-term market monitoring and the long-term oil demand outlook. Foreman has more than 20 years of industry experience in corporate strategic planning, forecasting, finance / risk management and regulatory policy at ExxonMobil, Talisman Energy and Sasol North America.