The United Nations wants Big Oil to have a seat at the table when it comes to climate solutions — an idea kind of like inviting a fox into a henhouse.
On Monday, the Intergovernmental Panel on Climate Change released its blockbuster new report, which sets some firm goals. To stave off the worst impacts of climate change, we need emissions to peak over the next two years and to cut emissions a whopping 65% by 2035. We’ve, essentially, got a little over a decade to seriously move away from fossil fuel use. Longer-term technologies may be useful in the future, but we need to get our arse in gear now to make those deep cuts by ramping up renewables.
At a press conference announcing the report, UN Secretary-General Antonio Guterres called the report “a wakeup call for humanity” and implored the world to join together to implement an aggressive agenda for the energy transition.
“I am also calling on CEOs of all oil and gas companies to be part of the solution,” Guterres said, recommending that these companies present plans with “actual emission cuts for 2025 and 2030, and efforts to change business models to phase out fossil fuels and scale up renewable energy.”
For some, this may be welcome rhetoric. Oil companies have made a lot of noise over the past few years about how they can be part of the climate solution. Take Chevron, which has spent an enormous amount of money on advertising that touts its “low carbon” portfolio.
“We believe the future of energy is lower carbon,” Chevron’s website states. “We intend to grow lower carbon businesses in renewable fuels and products, hydrogen, carbon capture, utilization and storage, offsets and emerging lower carbon opportunities.”
But that doesn’t mean that oil companies are racing to “phase out” fossil fuels, as Guterres calls for. There are a lot of sneaky tricks hidden in messaging like Chevron’s. “Lower” carbon, after all, is a meaningless phrase: it’s pretty easy to be “lower” carbon than a barrel of oil or a pile of coal. Notably, Chevron has publicly come out and said that it won’t be investing in wind and solar, since those technologies don’t have “value” to its shareholders and are already established technologies — a philosophy other oil companies hold as well.
A lot of these proposed technologies that Chevron and other oil companies are investing in have promise but are years away from being viable — meaning they’re useless for the short-term rapid transition to renewables and off fossil fuels that scientists say we must start making now. We’ve seen what can happen when a fossil company loses patience waiting for green tech to show its work. Last month, Exxon announced that it would be stepping back from its investment in algal biofuels, a technology that it has been pouring money into since 2009.
“It’s very challenging and very expensive to bring these technologies to market,” George Huber, a biofuels researcher for an Exxon-funded project at the University of Wisconsin at Madison, told the Guardian. “It’s not gonna happen overnight. …[Oil companies] are driven by Wall Street and they have to keep their stock prices high and keep their shareholders happy. And usually that’s making a large amount of money. All the oil companies have been talking about the need to get into more sustainable things, but it’s hard to make money with. And most of their money comes from oil.”
People who propose cooperating with oil companies like to tout that the technologies they are investing in are valuable but expensive, and that inviting Big Oil to participate in the solution by ponying up cash for research is a win-win situation. Why not make Chevron or Exxon foot the bill for biofuels, hydrogen, and other green tech that needs a lot of up-front investment? But what that argument misses is that oil companies have a vested interest in some forms of climate solutions: those that can help them keep polluting today.
Take carbon capture. Oil companies like Exxon and Chevron have excitedly thrown their weight behind a variety of carbon capture projects, from installing carbon capture technology at polluting power plants to investing heavily in direct air capture, which literally sucks carbon from the air.
The IPCC makes it clear that we need to deploy technologies that create negative emissions, including carbon capture, in addition to lowering emissions and getting off fossil fuels. We’ve simply put too much carbon into the atmosphere at this point to stay under the goals of the Paris Agreement by transitioning to carbon-free energy. Even in the most aggressive transition scenarios, we’re still going to need mechanisms to help us create negative emissions. But that’s not how oil companies see it. They’ve actually started saying the quiet part out loud: They want to use carbon capture as a way to extend the life of fossil fuels — which is not at all what the IPCC dictates.
“We believe that our direct capture technology is going to be the technology that helps to preserve our industry over time,” Occidental CEO Vicki Hollub told an audience at CERAWeek, an oil and gas conference, earlier this month. “This gives our industry a licence to continue to operate for the 60, 70, 80 years that I think it’s going to be very much needed.”
Occidental is currently constructing what will become the world’s largest direct air capture plant in the Permian Basin. But unfortunately for Hollub, we need to transition off of Occidental’s main product, oil, as quickly as possible. We don’t have 80 years to keep using oil and gas, even under the (dubious) assumption that we are able to increase our current direct air capture capabilities by magnitudes above what we’ve currently got.
Finally, there’s the simple fact that these companies want to make money, and fossil fuels are still profitable. Take BP, which has long traded its reputation on being a “greener” oil company than the rest, concerned about climate change and the energy transition. But last month, the oil major announced that it was backtracking on some of its more aggressive climate plans, in light of the cash it was raking in during the global energy crisis.
It would be great if oil companies did what Guterres is asking, but I’m not holding my breath. Policymakers like Guterres looking to spur the emissions cuts the world needs should get ready for an enemy, rather than an ally, when it comes to fossil fuel companies.
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