STRAIGHT TALK
Mark Gallagher on the possible emissions problem facing one of F1’s oldest fuel suppliers
Just as Ferrari was celebrating Charles Leclerc’s unexpected pole positions in Monaco and Baku, one of the Scuderia’s important, long-term sponsors was dealing with a surprise of rather more significant proportions. A court ruling which sent out shockwaves.
While we are used to court cases involving the tobacco industry, this time it was not Maranello’s friends at Philip Morris who were in the dock. Instead, it was Shell which found itself at the wrong end of a ruling.
Big Oil has replaced Big Tobacco. The charge is that they’ve smoked the planet.
Somewhat appropriately, things have heated up due to the cumulative effect of public opinion, successful lobbying by environmental campaigners and governments keen to fulfil their obligations under the 2016 Paris Agreement.
The global pandemic has also led many to rethink how small our world has become, and the need to treat it better.
On 26 May the District Court in The Hague gave its verdict in a case filed against Shell, by Friends of the Earth Netherlands, six Non-governmental Organisations and around 17,000 members of the public.
The claimants put the case that climate change is a human rights issue, arguing that the giant Anglo-dutch company had a duty of care to prevent harm coming to inhabitants of the Netherlands and the islands of the Wadden sea, a UNESCO World Heritage Site.
The court agreed, ordering the Shell Group to reduce its net CO2 emissions by 45% by 2030, compared with its 2019 emissions. Since the company is headquartered in the Netherlands, although it is a UK public limited company, the court’s order applies to Shell’s worldwide operations.
This is highly significant, even if the court’s decision applies only to Shell’s own operations, and not to the emissions produced by its suppliers or customers. As a result, 90% of the total global emissions attributed to Shell fall outside the judgement. Thanks to tobacco, we have been here before. These kinds of court cases are only going to increase in volume and consequence.
Given the importance of the energy sector to Formula 1, with around £250m in sponsorship coming from Aramco, Shell, Petronas, Exxon-mobil, BP Castrol, Orlen and Gulf, this could be a worry.
Except that F1’s ambitious target of achieving net-zero carbon emissions by 2030 gives it a strong hand, while the promise of using environmentally sustainable synthetic fuels by 2025 is the ace up its sleeve.
The majority of oil majors have fallen into line with the international target of limiting global warming to 1.5C, requiring net zero emissions to be reached by 2050. However, the pressure is on to advance that deadline.
BP’S CEO Bernard Looney recognised this when, in February last year, he outlined his ambitious plans to de-carbonise the company and ‘reimagine’ energy sooner than later. This has included a significant move into renewables and working with automotive groups including Volkswagen, Daimler and BMW to provide rapid-charged solutions to the electric vehicle market.
Synthetic fuels are a significant weapon in the de-carbonisation battle, evidenced by Porsche’s decision to invest in the Haru Oni project in Chile. This aims to produce 550m litres of synthetic fuel per year by 2026.
It’s clear ‘oil companies’ reinvented as ‘energy providers’ are looking for ways to evidence the speed of change within their sector. It might just be that F1 can offer them the means to achieve that in a world eager to kick its addiction to black gold.