Big Oil’s Net Zero plans: yet another episode of greenwash

Explore, extract, confuse, and lie. Big Oil’s toolbox might have changed, but their intentions and behaviour remain the same. First, there was climate denialism; next came Carbon Capture and Storage (CCS) and nature-based solutions; and now comes Net Zero.

Manipulation and constructive ambiguity: the veil of ‘Net Zero’

Despite claims of a green transition, none of the largest publicly traded oil companies’ decarbonisation pathwaysinvolve phasing out fossil fuels.

Instead, the Net Zero strategies of BP, Shell, Chevron, and ExxonMobil plan on increasing the production and sales of fossil fuels, alongside claims to reduce emissions through offsets and intensity-based targets.

We now have several studies showing that there are more oil and gas reserves and more planned production than could be burned while staying below the Paris agreement 1.5°C. According to the International Energy Agency (IEA) in May 2021, there can be no new fossil fuel developments for the world to reach net zero by 2050. The need for a fossil fuel phase-out is very clear.

So, what is the basis of Big Oil’s Net Zero plans?

On the surface, BP pledges to reduce emissions by a quarter before 2030 – watered down from a higher reduction pledge before the Ukraine war. However, a study, co-authored by Professor Gregory Trencher, finds that this aim relies mainly on selling on upstream assets such as oil and gas fields, with no guarantee that these reserves would be kept in the ground.

Also, BP does not aim to reduce the total quantity of fossil fuel products that it sells, when you consider its emphasis on third-party energy products (mainly transport and shipping fuels). When this is accounted for, higher sales of fossil fuels risk increasing BP’s absolute emissions this decade. 

Shell is the worst of the two European companies, completely scrapping plans to reduce oil and gas production this decade after the Ukraine war generated record-breaking profits. This, despite a previous commitment to reduce emissions this decade, shows just how fickle Shell’s Net Zero commitment really is.

Perhaps unsurprisingly, the two American oil majors exhibit the worst plans. ExxonMobil aims to increase oil and gasproduction by 10 percent by 2027, whilst Chevron aims to expand its oil and gas production at an annual rate of 3 percent per year by 2027.

Betting on bogus offsets

Even at points where Net Zero plans remain intact, there is a clear over-reliance on offsets to meet goals. These involve reducing or capturing atmospheric emissions through projects outside of the source of emissions, to compensate for emissions generated by burning fossil fuels. Whilst offsets are an important part of achieving Net Zero, they frequently overpromise and underdeliver on emissions reduction.

The climate benefits of offsets are also highly contestable. In a joint investigation last year on the largest supplier of forest carbon offsets in the world, it was found that these carbon offsets only delivered on 6% of the total carbon emissions they promised. This is the very same offset certifier that Shell buys its carbon offsets from, among other multinationals.

Offsets are also contentious because of their ties with significant human rights abuses and corporate land grabs. These claimed ‘offsets’ therefore often fail to remove carbon from the atmosphere, casting serious doubts on the claimed climate benefits of Net Zero.

Words, not actions: greenwashing galore

Professor Trencher’s study warns that absolute emissions from majors are forecast to increase by 2030, instead of the emissions reductions we so urgently need. 

Between 2009 and 2020, Shell, BP, and Chevron all raised fossil fuel production volumes. Shell, Chevron, and ExxonMobil all look to continue increasing their oil and gas production, as does BP, albeit through more obscure channels.

Any ambitions to transition to a low-carbon economy are too slow and too low. IEA data shows that oil and gas companies on average invest a meagre one percent of capex in clean energy. This pales in comparison to their continued investment in fossil fuels.

Big Oil’s Climate Strategy: explore, extract, confuse, and lie 

This study supports earlier analysis of oil companies’ greenwashing by Professor Trencher. In short, these studies tell us that ‘accusations of greenwashing appear well-founded’.

Net Zero is quickly being co-opted by Big Oil to maintain a façade of climate action and commitment. Oil companies are exploiting the main weakness of the Net Zero concept – that it has major technical loopholes – to put up a pretence of climate action. We should know that this is yet another effort to intentionally mislead the public. 

We have been warned that this decade is utterly crucial for climate action. And yet, Big Oil continues to extract and exploit and raise production of fossil fuels. Big Oil maintains an exploitative and lucrative business model; profiteering from war and a worsening climate. Despite claims and pledges and plans of Net Zero, their actions display the total opposite. 

In the face of mounting reports that more oil and gas is impossible to reconcile with a 1.5°C scenario, why should we give these companies yet another chance? Enough is enough.

No matter what they try to claim, a phase-out from fossil fuels is necessary and urgent to ensure a liveable future planet. Only concrete, comprehensive and certified actions to slash fossil fuel production and sales in line with a 1.5°C scenario will do.