Digital Energy Journal- How Baker Hughes is reducing its own emissions

Join | Existing Member Login

You are Home » News » View Article

How Baker Hughes is reducing its own emissions

Thursday, March 28, 2024

Baker Hughes announced in 2019 that it would reduce its own carbon emission by 50 per cent by 2030 and be net zero by 2050. Executives explained the progress so far, at the annual meeting in Florence

In 2019, Baker Hughes made a commitment to reduce carbon emissions by 50 per cent by 2030, and net zero carbon emissions by 2050.

'That was a milestone for our company,' said Holger Stibbe, Executive Chief Engineer with Baker Hughes, speaking at Baker Hughes' annual meeting in Florence, Italy, in January.

The emissions reductions will be achieved both by developing products with lower emissions, and encouraging customers to buy products with lower emissions.

Customer purchasing decisions

When emissions are taken into consideration in purchasing decisions by its customers, 'you get very different outcomes,' said Thomas Harper, VP commercial development and emissions management with Baker Hughes.

Operators are increasingly asking their suppliers what changes they are making, Mr Harper said. And it can be quite 'remarkable' how different the plans become, once emissions are factored in.

One North Sea oil and gas client asked Baker Hughes to make lifecycle assessments for all of its products.

Some of the differences between product options are bigger than you might expect. For example, we have found that emissions associated with metallic pipes are four times higher in emissions than non-metallic pipes.'

Sometimes the lower carbon option is more expensive, so decisions have to be made about where the priorities are. Other times, something which costs less can also be more efficient.

There may be choices available, such as to stop using diesel generators.

The ultimate aim is that emissions should be part of all decision-making processes. 'There's still some way to go,' Mr Stibbe said.

Emissions should be taken into consideration at operators' stage gate processes, where they review whether they will go further with a certain project, he said.

This means carbon data becomes a decision making tool, not just something used for analysis.

Sometimes the lower carbon option is more expensive, so decisions have to be made about where the priorities are. Other times, something which costs less can also be more efficient.

There may be choices available, such as to stop using diesel generators.

Product lifecycle carbon assessments

The company wants to set emissions targes for its own products, the same way as it defines profit targets for its products, Mr Stibbe said.

A big part of the work of reducing emissions from its own products is doing lifecycle assessments of the emissions associated with making and using that product.

Lifecycle analysis includes energy for the transport of goods, and energy in manufacturing.

Its emissions quantification project has been running for a year, seeking to gather data covering the manufacturing and operations phase of all of its products. Baker Hughes is doing lifecycle assessments on its drilling tools and pumps.

But it gets very complicated. For example, a single product, the well head (Christmas Tree) has 10,000 parts. The first life cycle emissions assessment of a Christmas Tree took 6 months to complete, which is too long to be practical.

The company has trained 560 staff members to do what it calls 'Fast LCAs', finding a balance between ensuring the final assessment is good enough to be credible, and a calculation process which doesn't take too long and is easy to use.

In 2022 Baker Hughes' oilfield services & equipment did 56 lifecycle assessments, 19 of these were peer reviewed, and in 2023 it plans to do 186, said Attilio Pisoni, senior vice president with oilfield services and equipment strategy and technology with Baker Hughes. 'We're gaining in efficiency.'

'It is a complex undertaking. The industry has to get better and better.'

In future, carbon data will be made available internally as easily as pricing information. Baker Hughes has very good data about its costs of spare parts, available when 'we push a button,' said Mr Pisoni. In future, 'carbon out will be looked at in that way.'

Improving products

Once you have the data, it can be used to make products more carbon efficient.

'Our people are motivated by designing tools [to be] more environmentally friendly,' Mr Pisoni said. 'What counts is, we know we're doing the right thing.'

The carbon lifecycle assessment becomes a design parameter, with design choices being made which lead to lower emissions, or to achieve a certain emissions outcome, he said. 'This is very motivating for our engineers.'

The company does not yet have a clear picture of how much emissions from various products could be reduced, but the picture is slowly emerging. 'We're looking at it in terms of tens of percent, not 1 per cent,' Mr Pisoni said.

Suppliers

Baker Hughes also needs carbon data from its own suppliers. It first started 'warming up' its suppliers on the emissions question in 2022, sending out a questionnaire, said Allyson Book, Chief Sustainability Officer with Baker Hughes.

The implication was, 'the expectation down the road [is that] you need to talk to us about what your emissions are,' she said.

If any suppliers want help managing their emissions data, Baker Hughes can help them get started, Ms Book said. 'We had to do this too. We had to lay out abatement pathways.'

Some suppliers have very high carbon emissions. One example is suppliers of special metals, who use a high energy smelting process.

But for most suppliers, providing data is still at a very early stage. They are not able to provide carbon data broken down for specific products, Mr Pisoni said.

So, most supplier emissions data is based on 'macro reporting', or 'proxy based', where an estimate of emissions is based on the amount of money spent, or a rough idea of emissions involved in making that specific product. Audit companies are willing to give their approval to such an assessment.

But it means that if any company goes further than the average to improve their emissions, the data does not show to their customers.

Rolling it up

How is the data brought together? 'You have to roll up everything you have,' Ms Book said.

'We're getting pressed to have a 'system of record' for ESG, like financing. We're trying to meet that rigour.'

The company has software tools which support gathering and compiling of data, and also recording how each data point was calculated, in case it is challenged later, she said.

Outside companies are called in to audit the data. 'You can't 'check your own work' without being called out for greenwashing,' she said.

Associated Companies
» Baker Hughes (BHGE)

CREATE A FREE MEMBERSHIP

To attend our free events, receive our newsletter, and receive the free colour Digital Energy Journal.