Energy companies Shell, BP, BG Group, Eni, Statoil and Total advocate for tackling global warming and inclusion of carbon pricing. In a letter to the Financial Times, getting out of coal and switching to gas is key and renewables also have a part to play. Such a letter aligns with the fact that a changing climate will open up new regions to the possibility of resource exploration, extraction and production and in some areas the ability to lift local communities out of poverty. In a world that needs to meet demand from a growing population seeking better living standards, energy and poverty are tied together. In this light energy companies also continue to diversity portfolios to include investment in an energy mix inclusive of renewables.
In a public intervention aimed at influencing UN climate talks, the letter stated that:
“As a group of business people, we are united in our concern about the challenge – and the threat – posed by climate change. We urge governments to take decisive action at December’s UN summit. We are also united in believing such action should recognise the vital roles of natural gas and carbon pricing in helping to meet the world’s demand for energy more sustainably.”
The letter is signed by Ben van Beurden, the chief executive of Shell, Bob Dudley, the chief executive of BP, as well as their counterparts at BG Group, Eni, Statoil and Total. Their letter echoes the views of Van Beurden, who recently told the Guardian that hydrocarbons would be needed for “years to come”. However, the Shell chief executive accepted that not all the world’s fossil fuel resources can be burned unless some way is found to capture their emissions.
Carbon capture and storage has gained momentum due to advancement in technology but there seems to be a lack of capacity to advocate for large-scale commercial adoption of such technology and its use. Perhaps carbon pricing will incentivise industry and provide governments with a tool to not only regulate emissions but place responsibility on stakeholders to reduce them. In this way the 2 degrees Celsius limit the world hopes to stay under can be achieved and the coming environmental impacts more adequately managed or adapted to. The aim over the next decade should be to reduce the length and magnitude of coming global scale environmental change and the frequency and period of extreme weather events that result.
Noticeable by their absence are any US firms. ExxonMobil and Chevron, the US’s two largest oil companies, ruled out joining any corporate alliance on climate. The head of Chevron, John Watson, told investors: “We think we can make our own statements and our statements speak for themselves.” Rex Tillerson, the chief executive and chair of ExxonMobil comments included:
- Not going to “fake it on climate change”;
- We’re not going to be disingenuous about it; and
- We’re going to express solutions and policy ideas that we think have merit.
The take home message from this letter should be the admission that the planet is changing faster than it would without human induced impacts on living systems and the climate. As a result, significant commercial opportunities lie ahead for the energy industry, for government regulation, and for society and the alleviation of poverty but the perils of runaway global warming and the impact it will have on people and their livelihoods need to be dealt with.