A new study analyzing the gulf between climate spending and claims from the world's. biggest private oil and gas companies finds that these businesses are still underinvesting in the energy transition and overpromising about their work.
The study, first reported by The Guardian, reveals that ExxonMobil, Chevron, Shell and BP -- companies that are responsible for more than 10% of global carbon emissions since 1965 -- are not actually living up to the commitments they've made to cut greenhouse gas emissions through their operations.
Researchers analyzed data for the past twelve years to see where the language companies used connected or diverged from the actual operations of the companies.
“Financial analysis reveals a continuing business model dependence on fossil fuels along with insignificant and opaque spending on clean energy,” The Guardian quoted the study saying.
It's the latest evidence that these oil and gas companies are not moving fast enough or shifting their resources quickly enough to meet the necessary targets to avoid the worst impacts of global warming.
For instance, planned production of oil and gas and the development of new reserves already exceed necessary limits to avoid the worst effects of climate change and keep the world on a path for only 1.5 degrees Celsius of warming.
Even under that scenario the world faces risks of increased flooding that could cost trillions of dollars. In the U.S. alone, rising floodwaters are putting about $1 trillion of real estate at risk.
“Until there is very concrete progress, we have every reason to be very sceptical about claims to be moving in a green direction,” Kyoto University professor Gregory Trencher, one of the report's authors, told The Guardian.
“If they were moving away from fossil fuels we would expect to see, for example, declines in exploration activity, fossil fuel production, and sales and profit from fossil fuels,” Trencher told The Guardian. “But if anything, we find evidence of the reverse happening.”
The research, published in the fifteen year-old journal PLOS One, analyzed language around climate-related keywords used in annual reports and then compared those statements to actions that would actually reduce emissions.
While U.S. oil companies ExxonMobil and Chevron were the most egregious culprits of greenwashing, European companies Shell and BP were also falling short of their stated goals.
All of the oil majors committed to reducing greenhouse gas emissions, but were simultaneously increasing their acreage and adding new drilling projects, the study found.
At the same time that these companies are investing heavily in new fossil fuel extraction, they're pushing a minuscule fraction of their resources and available capital into cleaner energy projects, according to the report.
Investments in emission free energy ranged from 0.2% at ExxonMobil to roughly 2% at BP, according to disclosures made to the Carbon Disclosure Project over the twelve year period.
Both Chevron and ExxonMobil reiterated statements about their investments in "lower carbon" businesses and carbon capture solutions. While Shell and BP addressed the study's claims more directly.
“Shell’s target is to become a net zero emissions energy business by 2050, in step with society. Our short, medium and long term intensity and absolute targets are consistent with the more ambitious 1.5C goal of the Paris Agreement," a spokesperson told The Guardian. "We were also the first energy company to submit its energy transition strategy to shareholders for a vote, securing strong endorsement.”
BP said that the company had only set its net-zero targets in 2020, so the actions that the company has taken since the study's analysis ended were not included.
"Because this paper looks back historically over the period 2009-2020, we don’t believe it will take these developments and our progress fully into account," a spokesperson said.
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