Oil companies’ climate claims are greenwashing, study finds | Oil

Greenwashing accusations against big oil companies that claim to be transitioning to clean energy are well founded, according to the most comprehensive study to date.

The research, published in a peer-reviewed scientific journal, looked at the records of ExxonMobil, Chevron, Shell and BP, which together have been responsible for more than 10% of global carbon emissions since 1965. The researchers analyzed the data over the 12 years to 2020 and concluded that the company claims not to align with its actions, which include increasing rather than decreasing exploration.

The study found a sharp rise in mentions of ‘climate‘, ‘low carbon’ and ‘transition’ in annual reports in recent years, particularly for Shell and BP, and growing promises of action in strategies. But concrete action was rare, and the researchers said: “Financial analysis reveals a continued reliance of the business model on fossil fuels as well as insignificant and opaque spending on clean energy.”

Many previous studies have shown that there are already more oil and gas reserves and more planned production than could be burned while staying below the internationally agreed temperature target of 1.5°C. In May 2021, the International Energy Agency (IEA) declared that there could be no new fossil fuel developments if the world were to reach net zero by 2050.

Oil companies are under increasing pressure from investors to align their activities with climate goals. But their plans have been met with skepticism, prompting researchers to conduct new research, which they say is objective and comprehensive.

“Until there is very concrete progress, we have every reason to be very skeptical of claims that we are moving in a green direction,” said Professor Gregory Trencher, from the University of Kyoto in Japan, who worked with Mei Li and Jusen Asuka at Tohoku University.

“If they moved away from fossil fuels, we would expect to see, for example, a decline in exploration activity, fossil fuel production, fossil fuel sales and profits,” he said. declared. “But if anything, we find evidence of the reverse happening.”

“The recent pledges look very nice and they’re getting a lot of people excited, but we have to put them in the context of the company’s stock history,” Trencher said. “It’s like a very naughty schoolboy saying to the teacher ‘I promise to do all my homework next week’, but the student has never worked hard.”

The new study, published in the journal PLOS One, found that mentions of climate-related keywords in annual reports rose sharply from 2009 to 2020. For example, BP’s use of “climate change” rose from 22 to 326 mentions.

But in terms of strategy and actions, the researchers found that “companies promise a clean energy transition and set goals more than they take concrete actions.”

Chevron and ExxonMobil were “lagging behind” Shell and BP, the researchers said, but even the actions of the European majors seemed to contradict their promises. For example, BP and Shell have pledged to cut investment in fossil fuel extraction projects, but both have increased their acreage for new exploration in recent years, the researchers said.

Additionally, the analysis revealed that Shell, BP, and Chevron increased fossil fuel production volumes over the study period. None of the companies directly publish data on their clean energy investments, but information they provided to the Carbon Disclosure Project indicates low average levels ranging from 0.2% by ExxonMobil to 2.3% by BP of spending. annual investment (capex). A separate analysis by the IEA indicates that clean energy investments by oil and gas companies accounted for around 1% of capital spending in 2020.

“Until actions and investment behaviors are aligned with the narrative, accusations of greenwashing appear to be well-founded,” the researchers said.

An ExxonMobil spokesperson said, “The transition to a low-emissions future requires several solutions that can be implemented at scale. We plan to play a leading role in the energy transition, while maintaining investment flexibility through an ever-changing portfolio of opportunities, including for example carbon capture, hydrogen and biofuels, to maximize returns for shareholders.

A Chevron spokesperson said: “We are focused on reducing the carbon intensity of our operations and seek to develop low-carbon businesses alongside our traditional lines of business. We plan $10 billion in low-carbon investments by 2028.”

The Shell spokesperson said: “Shell’s goal is to become a net zero emissions energy company by 2050, in tune with society. Our short, medium and long-term intensity and absolute targets are in line with the more ambitious 1.5°C target of the Paris Agreement. We were also the first energy company to put its energy transition strategy to the vote of its shareholders, thus obtaining strong support.

A BP spokesperson said: “In 2020, BP set out our new ambition, goals and net zero strategy, and in 2021 completed the biggest business transformation in our history to achieve them. Because this document looks back historically to the period 2009-2020, we do not believe that it will take full account of these developments and our progress.

Trencher dismissed the accusation that the analysis was out of date: “We included the documents that were published in 2021, so the so-called data gap is only about six months and we find no evidence. new actions that would change. any of our findings.

“Unfortunately, the way energy markets are structured around the world, fossil fuels still benefit from many [regulatory and tax] advantages and renewables are always at a disadvantage,” he said.

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