December 13, 2018 Read More →

Op-ed: Shell is playing games with new carbon emissions plan

Financial Times ($):

While it is true that Royal Dutch Shell gave shareholder activists on climate an early Christmas present, agreeing to reduce its carbon footprint by 20 per cent by 2035 and 50 per cent by 2050 (FT View, December 7), a closer look reveals that the commitment is a cynical game.

Shell is actually only agreeing to reduce the carbon intensity of its products — ie, carbon per unit of energy produced — not absolute emissions tied to a baseline year or carbon budget. That means Shell can continue to grow its gas business for decades to come, for example, given the lower carbon intensity of gas compared to oil.

The Paris agreement requires emissions to be zeroed out by 2050 to keep global warming from exceeding 2C. The Intergovernmental Panel on Climate Change just upped the ante, concluding that 2C is too much — exposing millions more to rising sea levels, resulting in complete destruction of coral reefs, significantly increasing the frequency and intensity of extreme weather events, and more. The report concludes that emissions must be reduced by 45 per cent by 2030, and that $2.4tn must be invested in clean energy annually, to have a chance at keeping the worst consequences of climate change at bay.

Judged by these metrics, Shell’s goal of halving the carbon intensity of its products by 2050 is not Paris-compliant — it is Paris-defiant. To cut the other half, Shell implicitly relies on massive deployment of negative emissions technologies, which either do not exist or remain untested by the market. There is nothing in its statement to constrain the many projects Shell is currently developing that are outside of the Paris agreement.

Carbon emissions reached a new record high in 2018. Institutional investors have awesome power to decide where tens of trillions of dollars will be invested. Betting on coal, oil and gas is betting on a future of increased human suffering and economic losses.

Shareholders now stand at a clearly defined crossroads: they must divest from the past and invest in the future, or they are clearly complicit in climate change and its impacts. There is no time left for games.  — Clara Vondrich, Washington, D.C.

More ($): The detail in Shell’s pledge is Paris-defiant

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