A relatively small number of fossil fuel producers and their investors could hold the key
Just 100 companies are the source of over 70 percent of the worlds greenhouse gas emissions since 1988, according to a new report.
The Carbon Majors Report (pdf) pinpoints how a relatively small set of fossil fuel producers may hold the key to systemic change on carbon emissions, ” says Pedro Faria, technical manager at environmental non-profit CDP, which published the report in collaboration with the Climate Accountability Institute.
Traditionally, large scale greenhouse gas emissions data is collected at a national level but this report focuses on fossil fuel producers. Compiled from a database of publicly available emissions figures, it’s intended to highlight the role companies and their investors could play in tackling climate change.
The report found that over half of global industrial emissions since 1988 the year the Intergovernmental Panel on Climate Change was established can be traced to only 25 state-owned and corporate entities. The scale of historic emissions associated with these fuel producers is big enough to have contributed significantly according to the report.
ExxonMobil, Shell, BP and Chevron are identified as among the highest emitting firms. If fossil fuels continue to be extracted at the exact same rate over the subsequent 28 years as they were between 1988 and 2017 global average temperatures would be to rise by 4C at the end of the century. This is very likely to have devastating consequences including substantial species extinction and global food scarcity risks.
While companies have a role says Faria, the barrier is the absolute tension between profitability and the need.
A Carbon Tracker study in 2015 found that fossil fuel companies risked wasting more than $2tn within the coming decade by following coal, gas and oil jobs that could be worthless in the face of international action on climate change and advances in renewables in turn posing substantial threats to investor returns.
CDP says its aims with the carbon majors project are both to improve among fossil fuel producers and to help investors understand the emissions associated with their fuel holdings.
A fifth of global greenhouse gas emissions are backed by investment, according to the report. That puts a responsibility to engage with carbon monoxide and urge them to disclose climate threat, says Faria.
Investors should move out of fossil fuels, says Michael Brune, executive director of US environmental organisation the Sierra Club. Not only is it morally risky, its economically risky. The world is doing so at a rapid pace and is moving away from fossil fuels towards clean energy. Those left holding investments in fossil fuel companies will find their investments becoming increasingly more risky.
There’s a growing wave of companies that are acting in the manner that is opposite to the firms in this report, says Brune. Nearly 100 companies such as Apple, Facebook, Google and Ikea have dedicated to 100% renewable power under the RE100 initiative. Volvo recently declared that all its cars would be electric or hybrid from 2019.
And gas and oil companies are embarking on investments. Shell set up a renewables armin 2015 with a $1.7bn investment attached and a spokesperson for Chevron says its dedicated to managing its [greenhouse gas] emissions and is investing in two of the worlds biggestcarbon dioxide injection jobs to capture and store carbon. A BP spokesperson says its determined to be a part of the solution for climate change and is investing in low-carbon innovation and renewables. And ExxonMobil, which has faced heavy criticism because of its environmental record, has been exploring carbon capture and storage.
But the sums involved and pace of change are nowhere near enough. A research paper published last year by Paul Stevens, an academic at think tank Chatham House, said international oil firms were no longer fit for purpose and cautioned these multinationals that they faced a nasty, brutish and short end within the next 10 years when they didn’t completely change their business models.
Investors have a choice, according to Charlie Kronick, senior programme advisor at Greenpeace UK. The future of the oil industry has already been written: the choice is will its decrease be handled, returning funds to investors to be reinvested in the real industries of the future, or will they continue, trusting not be the last one standing when the music stops?
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