Big oil stingy with green investments?

According to advocacy group the Center For American Progress, oil companies BP, Chevron, Conoco Phillips, ExxonMobil, and Shell are said to be big misers when it comes to renewable energy investments even though they spend millions of advertising dollars in green energy promotion.

The group’s new report says that the five companies made a combined profit of $100 billion last year but they just invested an average of 4% of their total 2008 profits in renewable and alternative energy ventures.

“This reality contrasts with their ads that promote greener, cleaner images,” the group says. “Despite their soaring earnings, the big five companies were very stingy with investments in renewable and low-carbon energy technologies and fuels that would reduce oil dependence.”

Uh, maybe because THEY ARE OIL COMPANIES that is why they can’tdestroy their company by trying to wean people away from oilconsumption immediately?? I spoke to a Shell official a few months agoand they said they are diversifying their energy resource but theybelieve that oil will be here to stay as long as possible.

Below are data about the five companies’ 2008 investments:

Company – 2008 data Exxon Mobil

Shell BP Chevron   Conoco Phillips
Profits (billions) $45.2

$26.3  $21.2   $23.9    ($16.8)
Amount invested in stock

buybacks and  dividends

(billions)
$40.1

$13.3  $11.6    $8     $11.02
Investments in stock buybacks

 and dividends compared to 2008 profits
88.7%

50.6%   55.0%   33.4% (see note below)
Amount invested in renewable

 energy (millions)
$10

$500 $1,500 $1,250    $650
Investments in renewable

and alternative energies

and efficiency compared to 2008 profits
<1%

1.9% 7.1% 5.2% (see note below)
Contributions to federal

 candidates and parties

for 2008 election cycle

 (millions)
$1.2

$0.3 $0.5 $1.0    $0.7
Lobbying in 2008

 (millions)
$29.00

$3.3 $10.5 $14.5 $8.5



*The net loss by Conoco Phillips is due to itswrite-downs of more than $34 billion for domestic oil exploration andproduction and an investment in the Russian oil company Lukoil. If notfor these costs, the company would have made a nearly $18 billionprofit, making 2008 the record year $134 billion for the Big Five.



One Response to Big oil stingy with green investments?

  1. Pradeep 1 April, 2009 at 12:38 am #

    I do not work for a oil company, but I do not understand why they are being specifically mentioned here. Does carbon sequestration come under “green investment”? I know a few companies that have active programs for CCS as well as enhanced oil recovery. [As the American Progress website points out, BP has investments in carbon sequestration].

    I think that the one problem is the lack of a price-signal. If the federal government enacted a cap-and-trade scheme where the fossil fuel producers were forced to reduce their GHG emissions, investments in alternative energy technologies would certainly grow. On the other hand, regulatory uncertainty does not favor large investments, because these companies have other, more economically favorable projects that require their capital.

    Most realistic energy estimates indicate that fossil fuels will continue to provide a large portion of our energy supply, at least till 2030. It is true that the amounts spent on renewables R&D is insignificant compared to the profits.
    This is what Exxon’s CEO, Mr. Rex Tillerson had to say about tax subsidies for alternative energy:
    “If I wanted to kill [tax subsidies], the thing to do is for Exxon Mobil to go and invest heavily in them and then Congress would immediately cancel the tax subsidy. Actually what they would do is they would just cancel it for us..”

    The quote that it takes two hands to clap comes to mind.

Leave a Reply