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HOUSTON—Houston might not seem like a likely residence for the next wave of the energy transition as the city is traditionally known as a hub for oil and gas companies. However, Houston is looking to grow its renewable and clean energy practices while still maintaining a foothold in hydrocarbons, according to industry veteran Bobby Tudor.
Tudor, CEO of Artemis Energy Partners who also co-founded Tudor, Pickering, Holt & Co., spoke at Hart Energy’s Energy Transition Capital Conference on May 10 on the benefits of energy transition-focused companies taking up residence in Houston.
Houston is not necessarily defined as a partner in the energy transition so much as it is seen as an impediment to the energy transition, Tudor explained, but “we don’t believe that to be true at all.”
“In fact, we are very much a partner in this transition, but part of what we need to do is make sure the world knows what we are doing,” he said.
Using Greentown Labs, a North American climatetech incubator, as an example, he explained how it took six years to acquire 60 member companies at its Boston facility. Meanwhile, it only took one year to acquire 60 member companies at its Houston facility due to the “explosion of entrepreneurial activity” in Houston, he said.
Tudor also serves as the chairman of the Houston Energy Transition Initiative of the Greater Houston Partnership, which promotes economic development and bring attention to the energy transition.
In order to reach the Paris Accord guidelines, the Greater Houston Partnership created a plan of action to implement across value chains, which Tudor said requires a “collective effort from government, industry, philanthropy and academia should focus on seven core pillars.” This includes:
- Bold innovation and cross-industry pilots;
- Attracting leading energy companies and startups;
- Branding and urban infrastructure;
- Cross-sector thought leadership;
- Talent reskilling; and
- Policy solutions.
Between 2030 and 2050, the changes brought on by the energy transition is projected to bring additional 600,000 primary and induced jobs to Houston. In contrast, if the city refuses to embrace the energy transition, it can mean a sharp decline in jobs.
“We certainly don’t think the incumbent industry is going away. We think the incumbent industry will be very, very important for as far as I can see,” Tudor said of oil and gas. “It’s just not likely to be the same engine for job growth, but this part of the business is likely to be a great engine for job growth.”
According to the International Energy Agency, global spending on the energy transition needs to increase form $800 billion per year to about $4 trillion per year. The need for this large increase in capital makes Houston an ideal area for the transition, as it grew into a center for capital at the beginning of the shale revolution.
Tudor believes that Houston can also become a center for capital for the energy transition in the same way.
“As capital starts to starts to flow into the energy transition, we want those capital providers like quantum to feel like they actually have a competitive advantage being in, in Houston, Texas, and they need to be in Houston, Texas,” he said.
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