–Future of the planet reduced to a public relations “talking point”
–Exxon apologizes, sorta…then makes another mea culpa Friday, making it really clear it’s in favor of economically efficient carbon pricing
Analysis By Mathew Carr
July 1-2, 2021 — (London): A sting by Greenpeace that reveals Exxon Mobil’s continued resistence to carbon pricing is a nail in the coffin of the idea that polluters don’t need to pay for the damage they are causing the environment.
From now on, U.S. politicians who have resisted aggressive climate action will be less able to do so. No doubt, at least some will still try.
The Greenpeace revelations will hopefully make it somewhat easier for the Biden-Harris administration to push through aggressive climate policy that will probably also be more economically efficient than policy set in the European Union. That efficient policy — along with events like the current heatwaves in North America — could place pressure on governments around the world, including in Europe, to more aggressively and efficiently tackle the problem and reform their policies.
Keith McCoy – a senior director in Exxon’s Washington DC government affairs team – told the undercover Greenpeace Unearthed reporter that he is speaking to the office of influential senate Democrat Joe Manchin every week, with the aim of drastically reducing the scope of President Biden’s climate plan so that “negative stuff”, such as rules limiting greenhouse-gas emissions and taxes on oil companies, are removed, according to the Unearthed report (see link below and I recommend you watch the full video in the Tweet).
During the undercover meeting, which took place via Zoom in May, McCoy suggested that Exxon’s public support for a carbon tax as its principal climate policy is an “advocacy tool” and a “great talking point” that will never actually happen, it said.
The sting gets to a very key issue — what threatens corporate lobbying threatens the barriers that are preventing political progress on climate protection in the United States, the country with only 4% of the world’s population but most of the blame for global warming.
For Democratic rep Alexandria Ocasio-Cortez, the situation is dire in the extreme because it reveals democracy in the U.S. has been “purchased and dismantled”.
It’s not just opposition to climate policy, but opposition to anyone willing to confront “corporate lobbying and dark money,” AOC told Channel Four UK TV news in a super interesting TV interview: https://www.channel4.com/programmes/channel-4-news/on-demand/72247-182
What’s unusual is that it’s being exposed in real time — as Biden seeks to win support for his agenda, AOC said. Usually this type of lobbying can take a long time to become public. Knowing it now makes it more potent.
“There are a lot of people that rely on that mode of operating here (I think she’s referring to Washington DC). This is serious, because this is talking about whether our basic democratic rights can be purchased (in real time as lawmakers are trying to pass laws). And if our rights can be purchased, our democracy can be purchased and if our democracy can be purchased it is dismantled,” she said.
If that dismantling can be prevented, there’s hope.
To be sure: The Exxon lobbyists were misled by Unearthed, which was posing as recruiters.
A few hours after the story broke Wednesday (I think), this popped: Royal Dutch Shell Plc (RDSa.L) plans to leave Aera, its California-based oil and gas-producing joint venture with Exxon Mobil Corp (XOM.N), four people familiar with the talks told Reuters. https://www.reuters.com/business/energy/exclusive-shell-plans-exit-california-joint-venture-with-exxon-mobil-sources-2021-07-01/
Coincidence? Maybe. Yet the fast-moving Exxon story is totally fascinating. Exxon’s boardroom has been infiltrated by climate activist investor Engine No. 1 LLC, apparently against its will.
Now, Shell — a European oil major seeking to lead on the global climate transition — is distancing itself from Exxon in California.
Another coincidence? EU carbon allowances jumped Thursday to more than 58 euros a ton, a record high, according to data on ICE Endex. The EU carbon market is the world’s biggest. It might not be a coincidence because there’s now a global race to attract capital and whichever markets have the best climate policy will get the most money for the clean transition.
The EU carbon futures rose late Wednesday, perhaps because news of the Greenpeace sting story had leaked before they settled around 5pm London time. Natural gas prices are also advancing, driving carbon higher. (So don’t worry too much about Exxon’s financial status)
Exxon apologizes, sort of:
On Friday, Exxon put out a further statement: “We believe a price on carbon emissions is essential to achieving net zero emissions. Carbon pricing would send a clear signal through the market, creating incentives to reduce emissions, fostering investment in R&D to advance solutions and providing consumers with transparency to make the best choices.” https://corporate.exxonmobil.com/News/Newsroom/News-releases/Statements/Our-position-on-climate-policy-and-carbon-pricing
Crucially, it said this:
We think it’s vitally important for the cost of reducing carbon to be more transparent to enable comparisons of the various options to help policy makers reduce emissions at the lowest overall cost to society.
Some commentators are skeptical there’s enough political will in the U.S. to tackle climate action cost effectively and install high-enough carbon-pricing levels — that is above $100 euros a ton (EU prices are already about $70).
This from Josh Margolis, Senior Commercial Advisor, Emergent Forest Finance Accelerator and CarbonSim — and carbon policy expert, on the Greenpeace sting. “In this age of tribalism, it does not follow that this reveal will make it easier for President Biden to push through a climate-smart infrastructure bill…nor that it will make it difficult for anti-climate action policymakers to resist legislation aimed at reducing emissions. A significant — and influential — faction of those with fossil fuel interests will ignore this, offer an alternative set of whatsboutism ‘facts,’ dismiss this as the product of ‘unethical journalism,‘ or push the ‘you can’t run your car on ideals/let them freeze/fry in the dark’ view. When the winds of change blow, some build wind turbines and others build walls.”
Because of these walls, President Biden may be forced to try less efficient climate policy because overt carbon pricing has been demonized for so long.
Robert Stavins, the A. J. Meyer Professor of Energy and Economic Development at the Harvard Kennedy School, is one who in January was pessimistic about prospects for getting the required 60 US senators to approve aggressive climate action: https://www.lawfareblog.com/biden-administration-and-international-climate-change-policy-and-action
Stavins’ more recent thinking is here: “Presently the greatest barrier to action in the United States is not technological, nor perhaps even economic, but fundamentally political.” See this Stavins blog/podcast: https://www.robertstavinsblog.org/2021/06/08/reflecting-on-economics-politics-and-climate-policy/
As I said back in January, I was heartened by the seven Republican senators who voted to impeach former president Donald Trump. It shows the Republicans are far from a lost cause.
Three more level heads than in the impeachment vote seems very possible indeed, especially after the Exxon sting. Perhaps, though, it’s not yet probable.
(Changes mislead to misled on Oct. 3. Adds Exxon’s Friday statement, AOC, Margolis; smooths Manchin description, adds Exxon apology, updates EU carbon price reaction; earlier added some of Unearth’s reporting)
Here is a link to the story that broke Wednesday night London time: https://unearthed.greenpeace.org/2021/06/30/exxon-climate-change-undercover/