In an unprecedented move six leading European oil companies, including BP and Shell have released a letter calling on the world to implement a price on carbon emissions.
In a three page document addressed to the United Nations climate chief the oil companies outline what they are doing to reduce carbon emissions themselves then calls on governments around the world to take consistent action to help limit carbon emissions.
“We need governments across the world to provide us with clear, stable, long-term, ambitious policy frameworks. This would reduce uncertainty and help stimulate investments in the right low carbon technologies and the right resources at the right pace”
It’s a surprising, but savvy move by the oil companies. They know that a price on carbon is the way many countries are going to go and by knowing what is coming they are better able to future proof their own profits. Not only that, they are supporting an action that is probably the least detrimental to their bottom line profits. They want countries to continue to use their product, not move to 100% renewable energy sources.
Carbon pricing is an extremely effective way of lowering carbon emissions on a country level. Just ask Australia, the first country to implement – then remove a carbon pricing scheme. When the ‘carbon tax’ was implemented the country saw emissions drop by as much as 17 million tonnes because of the carbon price and would have curbed more had industry expected the price to be permanent. The carbon tax was removed after two years due to a change in government and Australia saw record high carbon emissions immediately afterward.
Noticeably absent from the call to action letter are the US owned oil companies like Chevron or ExxonMobil. Exxon chief Rex Tillerson stated last week that investing in renewable energy is tantamount to “losing money on purpose.”
Read the full letter here
Image: Philippe Put (c)