Chevron adopts operational net zero ‘aspiration’ by 2050
Chevron Corp. committed to an “aspiration” of net zero emissions from its operations by 2050 as the company responds to rising investor and societal pressure to play a bigger role in a transition to a low-carbon future.
Chevron also set a target of reducing carbon intensity by five per cent from 2016 levels by 2028 for the full life cycle of its products, the San Ramon, Calif.-based company said Monday in a report. The target includes Scope 3 emissions, or those of its customers, which make up the majority of fossil fuel pollution.
While the pledge falls short of those made by European peers such as Royal Dutch Shell PLC and BP PLC, it’s the first time Chevron has outlined a multi-decade strategic commitment to reduce emissions. U.S. majors have been more reticent in adopting bold, long-term targets due to uncertainty over how to actually achieve them, an unwillingness to make large moves outside their core competency areas, and a desire to produce more oil and gas.
“In transition, companies that are delivering any unit of energy in at a more efficient carbon intensity are beneficial to our overall progress,” Bruce Niemeyer, Chevron’s vice president for sustainability and strategy,
said in an interview. “That’s the most important thing.”
Whether it’s enough to appease shareholders remains to be seen. In May investors defied Chevron’s board and voted to reduce Scope 3 emissions on an absolute basis, not just intensity, which is a measure tied to the amount of energy produced.
Follow This, the Dutch campaigner that filed the investor proposal, said Chevron’s new goal is “disappointing tokenism.” Rather than a five-per-cent reduction in Scope 3 intensity, absolute emissions need to come down by 40 per cent by 2030 to have any chance of achieving the 2016 Paris Agreement, the group said in a statement.
Niemeyer said today’s climate report “reflects a lot of investor feedback.”
Chevron isn’t the first U.S. oil company to adopt looser language around the definition
“net zero” than when the term was first introduced a few years ago. Conocophillips and Occidental Petroleum Corp. have also set 2050 net zero as an ambition or an aspiration rather than a hard target.
But semantics aside, even those oil companies with seemingly stringent targets are light on detail with how to eliminate carbon emissions from their fossil fuels, especially in the outer decades of their plans. Exxon Mobil Corp. executives expressed skepticism over net zero targets earlier this year in a meeting with Citigroup Inc. banker Stephen Trauber because they had no concrete plans of how get there.
“I assured them most companies today who have committed to net zero don’t have a plan on how to get there, but they’re working to get there,” Trauber said last month.