Industrial engineering software company Aveva (AVV) is confident that it will prosper from the mass move to renewable energy and environmental efficiency by driving digital transformation.

The UK’s largest listed software company, worth £10.5 billion, Aveva provides engineering, design and enterprise software solutions primarily to the oil & gas, marine and power industries.

Following its merger with Schneider Electric in 2017, and the $5 billion acquisition of US-based data analytics provider OSIsoft, which completed in March this year, Aveva is bringing disruptive engineering technology to an energy industry which has found itself under a harsh spotlight as concerns over climate change increase across the world.

Oil majors have been writing down assets, financial institutions are turning away from oil investments, and plastics are likely to substantially underperform the industry’s rosy projections.

All the while, customers, corporate partners, investors, shareholders, and activists are putting ever-increasing pressure on oil and gas companies to begin planning seriously for climate change.

The oil industry has responded to the scrutiny with a series of pledges, plans, and press releases addressing global warming. The big five oil giants – Exxon Mobil and Chevron in the US, the UK’s BP (BP.), Total or France, and Anglo-Dutch Royal Dutch Shell (RDSB) – have all promised, with varying degrees of ambition, to reduce their emissions.

But ratings agency Moody’s recently observed (28 May) that the credit risk for major oil producers has increased after recent events. Shell was defeated in a Dutch climate lawsuit while both Exxon and Chevron have lost battles with shareholders, forcing them to cut emissions targets further.

Aveva’s chief financial officer James Kidd told Shares last week that he believes that there is a large opportunity for his company to work with oil companies eyeing renewable energy projects as part of their own carbon-cutting plans.

HUGE OPPORTUNITY

A 2019 World Economic Forum report said digital transformation in the oil and gas industry could unlock approximately $1.6 trillion of value for the industry, its customers and wider society while creating around $1 trillion of value for the operators.

Aveva has extensive expertise in the renewables space, with a long history working in the nuclear industry, plus a growing presence in the planning and designing of solar and wind farms, and energy storage projects.

The industries that Aveva serves are making increasing use of technology to reduce costs against a backdrop of competitive pressures.

‘This is being enabled by ongoing technological mega trends that are driving the digitalisation of the industrial world, notably the industrial internet of things, Cloud, data visualisation and Artificial Intelligence,’ Aveva observed.

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