Rystad Energy compared what the European companies spend on new oil and gas development with what they are spending on new renewables. The agency noted that based on current trends, that could rise to 4% this year, or "well above 10% for some of the leading European companies." That's significant growth - from a small starting point. Yet despite all the excitement, there's this reality: Unless the world's governments and consumers make dramatic changes - triggering a rapid shift in corporate plans - oil and gas companies aren't on track to shift their investments as rapidly as analysts say the planet requires.Įven among European companies, green investments so far have been dwarfed by their investments in oil and gas.Įnvironment Carbon Dioxide, Which Drives Climate Change, Reaches Highest Level In 4 Million YearsĪ recent report from the International Energy Agency found that in 2020, the oil and gas industry as a whole spent just 1% of its capital expenditures (money spent on physical things) on clean energy. The oil and gas industry is betting change will be slowĬlimate change activists may have celebrated key victories recently, including an activist hedge that managed to elect three new directors to Exxon's board in a direct rebuke to Exxon's oil-centric investment plans, and a ruling from a Dutch court ordering Royal Dutch Shell to lower emissions. Similarly, Chevron recently announced a $300 million venture fund dedicated to a range of "low-carbon technologies." That's around 2% of the $14 billion to $16 billion Chevron spends each year on capital expenditures. Then there's carbon capture, technology that can prevent carbon dioxide from being released or even pull it out of the atmosphere – which is key to understanding the other half of the European-American divide. Many companies are also banking on hydrogen or biofuels. Shell has invested in electric vehicle charging stations, for instance. Wind turbines and solar panels get a lot of attention, but they aren't the only options for a post-oil future. will be to develop it by the 2030 deadline," he says. "The challenge for them will be to acquire that remaining portfolio and then the real challenge. "The question we're asking on Big Oil right now is, are their renewable ambitions running on empty?" says Gero Farruggio, the head of global renewables at Rystad Energy, an independent energy research company.įarruggio points out that many companies have been telling investors they'll have significant renewable production by 2030, less than a decade from now. But can they meet these targets? Skeptics point out that oil companies trying to make this switch are competing in an increasingly crowded renewable market, outside of their core strengths, and are making pledges under an aggressive timeline.
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