The climate discourse and pledges by the energy giants BP, Chevron, ExxonMobil, and Shell are high and mighty — but their actions don’t back it up. Researchers reviewed 12-years’ worth of data and found none of the companies is on the way to a clean energy transition, with a long way to go to reduce their emissions and a big gap between what the companies are saying and what they’re actually doing.
Fossil fuel companies have played a big role in driving the climate crisis. Twenty companies are responsible for 35% of all energy-related emissions worldwide since 1965. The leading emitter is Chevron, followed by Exxon, BP, and Shell, accounting for over 10% of global carbon emissions since 1965, according to a previous study. You could make a very solid argument that big oil companies have a responsibility to reduce their climate impact.
As the world moves away from fossil fuels to reduce emissions, oil companies are under even more pressure, as they have to deal with the possibility of a decreased demand for hydrocarbons and reduced profits. Developments such as the electrification of road transport and climate policies targeting fossil fuel extraction and use suggest a transition to clean energy sources.
But the dance that fossil fuel giants do is one step forward and one step back. Some have begun investing in renewables and low-carbon technology and many have announced various targets to mitigate greenhouse gas emissions. However, the historical behavior of these companies suggests that the authenticity of these claims has to be examined, researchers argue.
Mei Li of Tohoku University, Japan, and colleagues focused on two leading fossil fuel companies from the US (Chevron and ExxonMobil) and two from Europe (BP and Shell). They reviewed their business strategies and investments, financial data, and keywords related to the transition in annual reports spanning the years 2009 to 2020 to see how their actions compare to their public announcements.
“A news article in 2019 showed suspicion to the clean energy and transition claims of the oil majors. We decided to follow this up with a comprehensive and objective study that compared transition progress of the four largest investor owned oil majors, and compare their words to their actions and investments,” the researchers told ZME Science.
A slow energy transition
The study showed that companies’ annual reports used an increasing number of keywords related to the climate crisis, such as “low-carbon” and “transition”, especially for BP and Shell. There was also a big contrast with their US counterparts in the business strategy, with BP and Shell largely acknowledging the climate science, while Exxon and Chevron went to great lengths to deny it as much as possible.
Chevron and ExxonMobil continuously exhibited defensive attitudes to renewables investment and the need to shift from fossil fuels, explicitly stating ambitions to grow rather than reduce hydrocarbon production. Leaving aside these differences, none of the four companies formulated strategies to translate pledges into concrete actions.
This especially concerns intentions to curb the production of fossil fuels as well as reduce exploration and new developments. None of the companies are transitioning its core business model away from fossil fuels, the researchers argued, identifying no trend toward lower fossil fuel production and higher investment in renewables.
“Claims about efforts to transition to clean energy are not supported by actions and investments,” the researchers told ZME. “Until there is a larger and sustained increase of concrete actions to transform business strategies and invest in carbon-free or renewable energy, accusations of greenwashing appear to be well substantiated.”
The researchers suggested a set of improvements the companies could make to match their words with action, such as: communicating an awareness that mitigating climate change requires cutting down fossil fuel production, publishing a roadmap of how fossil fuel investment will be downscaled, and releasing data on clean energy spending in a consistent way.