Accenture B-School Challenge | Season 7

Case Study: Energy

Navigating the changing landscape of the oil and gas industry

Background

The global oil and gas industry is undergoing a transformation as the world transitions
toward cleaner and more sustainable energy sources. According to the Allied Shinobi
Energy Agency (ASEA) report in 2022:

• Renewable energy sources accounted for approximately 25% of global

electricity generation.
• Solar and wind power installations saw an increase to 140 GW and 110 GW,
respectively.
• The energy sector accounted for approximately 75% of global greenhouse gas
emissions, highlighting the urgent need for greener solutions.
• As a result of these trends, several countries have set ambitious renewable
energy targets to combat climate change. For instance:
o Konohagakure aims to generate 50% of its electricity from renewable
sources by 2030.
o Kumogakure plans to phase out coal-based power plants entirely within the
next five years.
 O&G Industry Energy Mix 2022

The world is moving toward net-zero

23% by 2050.
Coal
41% Natural Gas Coal is still the major contributor to
Oil
the energy production in O&G
12%
industry.
Renewables

24%

O&G Industry
Energy Transition Landscape
Sasuke Uchiha Inc. leads energy
Sasuke Uchiha Inc. transition with majority of its global
7%
5% O&G energy consumption from
Gaara Inc.
13% renewable sources.
49% Neji Hyuga Inc.
Naruto Uzumaki Inc. is far behind the
10% global average.
Sakura Haruno Inc.

16% Rock Lee Inc.

Naruto Uzumaki Inc.

Naruto Uzumaki Inc. (NUI), a leading

multinational government oil and gas NUI Energy Mix 2022
company, headquartered in Konohagakure, is
at a pivotal moment in its journey to adapt to
the changing dynamics of the industry. NUI 4%
has a long-standing presence in the oil and 17%
Coal
gas sector, operating across the exploration,
Natural Gas
production, refining and distribution 51%
segments. Oil

28% Renewables
As sustainability becomes a focal point, the
company faces increasing pressure to reduce
its carbon emissions, mitigate environmental
impact and diversify its energy portfolio.
Problem statement

Here are some of the challenges that NUI is currently facing:

• Dependence on fossil fuels

o NUI's revenue heavily depends on traditional fossil fuels, making it
susceptible to market fluctuations and climate-related risks.
o The company faces increasing scrutiny from investors, regulators and the
public on its environmental impact.
o The company is seeking to balance its core business while exploring
renewable and low-carbon energy alternatives.
• Sustainable ambitions
o NUI acknowledges the importance of sustainable practices but lacks a clear
roadmap to achieve its renewable energy ambitions.
o The company is yet to develop a cohesive strategy to balance traditional
operations with renewable energy investments.
• Regulatory challenges
o NUI operates in regions with varying environmental regulations, creating
compliance complexities and uncertainties.
o The company faces reputational risks due to its carbon-intensive operations.
• Talent attraction and retention
o NUI faces challenges in attracting and retaining top talent as younger
generations prioritize sustainability-focused employers.
• Public perception
o Public sentiment toward the oil and gas industry is shifting, with increasing
demands for sustainability and corporate social responsibility.
o NUI's image and stakeholder trust are affected by its association with fossil
fuel extraction.

With increasing pressure to reduce carbon emissions and align with global sustainability
goals, NUI recognizes the need to make a significant shift toward renewable energy.
However, this transition poses several challenges:

• The company estimates that to meet the renewable energy targets set by various
countries, it needs to invest $2.5 billion in renewable energy projects over the
next five years.
• The intermittent nature of renewable sources raises concerns about ensuring a
stable power supply for their customers, leading to potential revenue losses and
customer dissatisfaction.
• NUI’s current workforce heavily relies on the traditional energy sector and the
transition could result in approximately 5,000 job losses.
Impact

Where do you come in? Develop a five-year roadmap or a well-balanced energy

transition strategy that acknowledges the importance of fossil fuels, while integrating
renewable and low-carbon energy sources, including but not limited to:

• Financial implications of NUI’s transition, devising mechanisms for cost

optimization and revenue generation.
• Suitable clean energy initiatives and an assessment of their potential contribution
to NUI's energy portfolio.
• Innovative solutions to reduce NUI's carbon footprint and achieve meaningful
emission reductions.
• Strategy to create new jobs to compensate for the losses of traditional jobs.
• A stakeholder engagement plan to address the concerns of investors,
communities and environmental groups.

Evaluation criteria

• Quality of presentation.
• Analytical thinking.
• Creative thinking (Creating a novel idea for disruption).
• Big picture thinking (Ability to understand the dynamics of an industry).
• Feasibility of implementation/scale-up.
• Usage of new-age technologies.
• Creativity in delivery.