Only 100 Companies are Responsible for 71% of Global Emissions
A recent research has shown that over 70% of the global fossil fuel emissions since 1988 have been emitted by just 100 companies.
The Carbon Majors Report states how a small number of fossil fuel producers may be crucial to systemic change in carbon emission as noted by one of the technical directors – Pedro Faria – at environmental non-profit CDP, which in collaboration with the Climate Accountability Institute published the report.
This report focuses on the fossil fuel producers, however; the large scale greenhouse emission data is conventionally collected at the national level. This report was done by taking the various reports and publicly available data on greenhouse emission into consideration. Hopefully, it will be a starting point for a series of publications that will place emphases on these companies and how important they are to effectively tackle climate change.
Recent reports dash hopes of mild climate change
The Intergovernmental Panel on Climate Change was established in 1988 and they discovered that only 25 corporate or state-owned entities were responsible for up to 50% of the global industrial emissions. The report also stated further, how these 25 producers of fossil fuel have significantly contributed to what is known today as climate change.
Among the highest emitting investor based companies since 1988 include Chevron, BP, Shell, and ExxonMobil. The report noted that if the rate at which fossil fuels were emitted over the last 28 years is maintained for another 28 years, come the end of the century, a significant 4 degrees Celsius would have been gained in average global temperature. The consequences of this will not be minor. It’ll affect life as known today, leading to the risk of scarcity of food and the extinction of some species.
Faria is of the opinion that these companies are key to the battle against climate change but the top barrier they face is the absolute tension between the urgent need for reduction in fossil fuel emission and short term profitability.
A Carbon Tracker study which was done in 2015 discovered that these companies stood the risk of wasting over $2tn in the coming decade if they pursue coal, oil and gas projects that may not have tangible results on the climate change advance and renewable, thus posing significant threats to investor returns. CDP stated that its purpose for the carbon-majors project was to enlighten investors on issues of fossil fuel as well as improve transparency amongst producers.
Based on the report, about 20% of the major fossil fuel producers are backed by public investments. For this reason, Faria thinks that the investors have a responsibility to engage with major fossil producers and urge them to make available all impending climate risks associated with fossil fuel emission.
The executive director of the US environmental organization, The Sierra Club – Michael Brune – says that investors should move out of fossil fuel because it is morally and economically risky. The pace of people moving from fossil fuel to clean energy is growing and with time, the fossil fuel investments will become even riskier.
G20 public finance for fossil fuels 400% that of renewables
Brune also stated that there is a quite remarkable move towards the other end by some of the world’s biggest companies. Companies such as Ikea, Google, Facebook, and Apple have all committed to 100 percent renewable energy under the RE100 initiative. Volvo also stated that all its productions from 2019 will be hybrid or electric.
Even the major fossil fuel producers are beginning to take massive steps to ensure reduced impact. Over $1.7bn was invested in the renewable arm by Shell and the spokesperson for Chevron stated that Chevron was committed to managing its emissions. To this effect, they are investing in 2 of the biggest carbon dioxide injection projects which are aimed at capturing and storing carbon. BP also stated through its spokesperson that they are also investing in renewable and low carbon innovation. ExxonMobil, which has been the subject of a lot of criticism for its ecological record has also been exploring the capture and storage of carbon.
However, a lot of people believe this is not enough to get the required result in the near future. An academic at the think tank Chatham House, Paul Stevens warned these oil companies that they were no fit for purpose and if they don’t change their business models, they risk a nasty brutish short come the end of the next decade.
The senior program advisor at Greenpeace UK, Charlie Kronick says that investors are faced with a choice; seemingly because the future of oil and gas has only one end. However, the question is; will this decline be properly managed such that investors will be reimbursed on the line so they can invest in economically viable businesses in the future? Or will they hold on, hoping to be the last man standing when the music stops? Because the music will definitely stop.