The world’s fossil fuel giants are missing global targets on climate change
The world’s leading fossil fuel companies are all failing the UN’s climate goals, according to research published Wednesday by the Transition Pathway Initiative (TPI). The research institute, formed of a partnership between the London School of Economics and global asset managers, was founded to assess and assist corporations as the world transitions to a zero-carbon economy.
For its latest assessment, TPI researchers analyzed the “carbon management” levels at 59 of the world’s largest publicly listed oil, gas and coal companies—projecting the impact of each entity’s carbon emissions against benchmarks set by the Paris Agreement.
The Paris Agreement seeks to cap global warming to an average of 2°C above pre-industrial levels. The report from TPI shows that none of the 59 fossil fuel giants assessed are on track to meet the goal.
“Investors have witnessed a flurry of significant climate announcements by fossil fuel majors this year, so it is striking this independent research still shows those commitments do not yet align with limiting climate change to 2°C,” says TPI co-chair Adam Matthews.
Seven fossil fuel giants—Glencore, Anglo American, Shell, Repsol, Total, Eni and Equinor—are in line with the reduction targets set by their home governments, at least. But the targets those seven are following are still wider than the 2°C standard, allowing for a future where temperatures rise 3.2°C.
For all its bluster about investing in renewables and downsizing its business, BP is notably absent from the seven. French multinational Total, which (like BP) has set a target of being carbon neutral by 2050, is there. As is Dutch heavyweight Shell is also pledging to go net-zero, but hasn’t set a date.
Interestingly, all seven of those firms that have fallen in line with local climate goals are European. According to Matthews, U.S. fossil fuel giants have “yet to take meaningful action” to reduce emissions. In fact, Bloomberg reports that ExxonMobil planned to increase carbon emissions 17% by 2025 in order to increase production.
Those increases might not happen now that the pandemic has slashed oil demand—but the attitude that emissions growth is still a viable option seems to remain.
U.K. Prime Minister Boris Johnson wants to power every home in the U.K. with renewable energy by 2030—specifically, energy generated by offshore wind farms. Such a task would require $50 billion in investment and the installation of one new turbine every weekday for the next decade. The FT says that the government “does not appear to have grasped the scale of the task,” which would be par for the course.
Solar and wind giant NextEra surpassed ExxonMobil in market value last week, as its market cap reached $138.6 billion on Friday. The world’s largest renewable energy producer is now looking to acquire North Carolina-based utility Duke Energy Corp. Duke, which has a market value of $61 billion, rebuffed the offer. But, reportedly, NextEra remains interested.
According to the Wall Street Journal, the median pay for CEOs at major U.S. oil and gas drillers rose for four consecutive years from 2015, peaking at $13 million last year. Over the same period, returns to shareholders dropped 35%. Taken as a group, the shale CEOs received larger raises in 2019 than peers in all but two of the 11 major industries analyzed, the Journal says.
Executives from Adidas, Lululemon, Kering and Stella McCartney all said they will partner with California-based Bolt Threads to manufacture garments made from the start-ups mushroom-based leather, Mylo. The fabric is derived from mycelium—the threadlike roots that connect vast fungal blooms.
Nicolai Tangen, the new chief executive of Norway’s $1 trillion sovereign wealth fund, wants the fund to sell out of investments that are performing badly in ESG. The fund—formed from the profits of Norway’s oil rigs—sold out of 42 companies in 2019, mostly for using or producing coal but also for breaching expectations on human rights, anti-corruption and other ESG standards.
Poland has slapped a $7.6 billion antitrust fine on Russia’s oil giant Gazprom, which is currently constructing a pipeline feeding gas from Russia, under the Baltic Sea and into Germany. The pipeline is heavily opposed by Poland and the U.S., which has said it will sanction any company that works on the line. Both countries believe the pipeline will make Europe too reliant on Russia for energy.
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