Walking the walk not up to speed with the talk

Decarbonization and "green energy" promises by oil majors overshadowed by inactivity
Published on

Kyoto, Japan -- A Kyoto University study has revealed that clean energy claims by four major oil corporations -- Shell, BP, Chevron, and ExxonMobil -- are not supported by their actions. This conclusion is supported by ongoing accusations of greenwashing in this industry.

Our planet is inching ever closer to a climate catastrophe due to the effects of greenhouse gases, or GHG, the majority of which are emitted by fossil fuels. Indeed, the fossil fuel products of some twenty multinational petroleum companies are responsible for over a third of global GHG emissions since 1965.

The study focuses on the four largest investor-owned oil majors, which are collectively responsible for a tenth of all global GHG emissions from energy. As a strategy to improve or salvage their public image, these majors have touted their clean energy business models in order to be seen as good examples if not leaders in the fight against climate change.

Between 2009 and 2020, the research team collected and compared data of clean energy transition activity and the extent of decarbonization using three perspectives: 1) discourse, reflecting the use of keywords related to climate change and clean energy in annual reports; (2) pledges and actions, reflecting strategies to transition business models away from fossil fuels; and (3) investments, reflecting production, expenditures and earnings for fossil fuels along with investments in clean energy.

The research findings on all four oil majors show that the discourse and the corresponding pledges have increased disproportionately over concrete actions, such as lower fossil fuel production. Despite the public relations efforts, the analysis of business models indicates a persistent dependency on fossil fuels and no strong evidence of a shift towards non-fossil fuel energy.

For example, according to the data on the average daily production of oil and gas combined, no majors but ExxonMobil show a clear decreasing trend over the study period. Furthermore, for all majors, the team similarly found no persistent downward trajectory for reserve estimates or refined oil sale volumes. Meanwhile, investments in renewable energy and clean electricity generation are insignificant in comparison to total CAPEX spending. 

Influential companies always talk the talk but often find it challenging to walk the walk. In this case, louder greener talk does not register as a cleaner greener walk. There is substance to the authors' calling out on unsubstantial commitment to cleaner energy by the four oil majors.

TRENCHER Gregory Patrick