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Who is to blame that the world is off track to meet its climate goals? A major fossil fuel company yuckity-yuk says it’s you, Mr. and Ms. Public, because you can’t handle the cost transparency reality of making the transition to renewables.
You heard it right. Darren Woods, chief executive of oil monstrosity ExxonMobil, told Fortune last week:
“The dirty secret nobody talks about is how much all this is going to cost and who’s willing to pay for it. The people who are generating those emissions need to be aware of and pay the price for generating those emissions. That is ultimately how you solve the problem.”
The actual dirty secret is that you’re going to help fossil fuel behemoths to maintain their profits while they should be reinvesting every cent in solar, wind, hydro, geothermal, and other renewables. If Woods has his way, you’ll be funding minimal annual profits of $36 billion for ExxonMobil moving forward.
Yes, the ludicrous premise that it’s your responsibility to help fossil fuel companies make a grand old profit is reiterated, over and over, in different ways and by different players who have a whole lot to lose in the transition to a zero emissions economy.
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The increasing intensity of climate pollution and the steady rise in temperatures, despite scientific consensus and exhortation about their scale and consequences, demonstrate the difficulty of solving the existential climate threat that surrounds us. Breaking the link between economic growth and climate pollution will require historic levels of capital expenditure in clean energy, transport, and industrial infrastructure as fossil fuels are replaced with low carbon alternatives.
Of course, ExxonMobil and other fossil fuel conglomerates won’t be absorbing the transitional cost to renewables — the common expectation is that the consumer will absorb those fees through what’s truly a lack of cost transparency.
Serious steps are needed to mitigate what is likely to be a full blown climate catastrophe. Experts say that the only way to avert a catastrophe will require gaining public control over energy policy and countering the power and influence of fossil-extracting industries.
But the idea of losing control over their decades-long cash cow makes fossil fuel companies quake, and they’ll do nearly anything to avoid taking responsibility for their climate polluting actions. This includes condescending to you, their customer, suggesting that you’re not worldly enough or not immersed enough in energy knowledge communities or not psychologically stable enough to handle the financial hit you’ll have to take.
It’s not about you — it’s about their greed. And their profit-hungry identities were shaken mightily at COP28, where proponents implemented an initial process to institutionalize new anti-fossil fuel norms.
“We have opportunities to make fuels with lower carbon in it, but people aren’t willing to spend the money to do that,” Woods continued on in the Fortune interview.
ExxonMobil is the world’s largest investor-owned company, and Woods expressed a lack of confidence for “the ability to generate above-average returns for investors” from established clean energy generation such as wind and solar. “We recognize a need for that,” Woods admitted. “We just don’t see that as an appropriate use of ExxonMobil’s capabilities.”
It is also at the top of all contributors to global planet-heating climate pollution. But Woods insists that his company and others like it aren’t the ones who should primarily be held responsible for the climate crisis.
If, indeed, Exxon is a molecule company, as Woods claims, then it is not an electron company. Fine. But climate solutions must, in large part, become the responsibility of the promoters of fossil fuels. That means fossil fuel subsidiaries and governments. It means establishing responsibility and accountability for the seemingly intractable problem. Internationally, governments provide at least $775 billion to $1 trillion annually in subsidies, not including other costs of fossil fuels related to climate change, environmental impacts, military conflicts and spending, and health impacts.
Exxon received its share of subsidies to build out its clean energy business from the 2022 Inflation Reduction Act, Fortune chief executive Alan Murray pointed out in the interview. But Woods countered that “building a business on government subsidy is not a long-term sustainable strategy.” Woods is reading the tea leaves of increasingly populist global leaders. In fact, governments and fossil fuel companies plan to increase production, with fossil fuel production in 2030 estimated to be twice as much as what is consistent with keeping global warming below 1.5°C.
“The way that the government is incentivized and trying to catalyze investments in this space is through subsidies,” he said. “Driving significant investments at a scale that even gets close to moving the needle is going to cost a lot of money.”
It is proven now that ExxonMobil recognized as early as the 1970s about the effect of burning fossil fuels on global heating. Instead of taking action, they mounted public influence campaigns to diffuse concerns about the climate crisis and to affect legislation that might restrict fossil fuels through significant lobbyist efforts. “What they’re really trying to do is to whitewash their own history, to make it invisible,” Robert Brulle, an environment policy expert at Brown University who has researched climate disinformation spread by the fossil-fuel industry, told the Guardian.
Decades have passed, and now Exxon is confronting lawsuits for its complicity. Anti-fossil fuel norms are increasingly being adopted and institutionalized. “When are people going to willing to pay for carbon reduction?” moaned Woods.
What is emerging is a series of important questions over the specific content of emerging anti-fossil fuel norms, the role of the fossil fuel industry in climate governance, the extent to which these norms fit with their broader normative context, and the conditions of North–South cooperation in which such norms are to be implemented.
As if it was a wash, Woods pointed to ExxonMobil’s small renewable energy investments and touted its carbon capture and hydrogen fuels efforts.
The challenge with all those solutions, he said, “is the cost ultimately, explicitly bears itself in the price of products out there.” Meanwhile, Woods is making the rounds on media channels while Exxon turns the table on activist shareholders who aretrying to force ExxonMobil to uphold stricter environmental standards. Those shareholders, Woods said, were trying to stop Exxon’s central business model of selling oil and gas — and that’s not a direction his company is willing to go.
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