Oil and gas executives will have to substantially increase their clean energy investments to overcome a "trust deficit" with the public about their commitments to addressing climate change, US energy secretary Jennifer Granholm said today.
The industry has made some progress in cutting emissions and committing to future cuts, Granholm said today to oil executives serving on the National Petroleum Council. But the sector should expect escalating difficulty related to public opinion until operators successfully cut emissions and invest in clean energy at the scale required to address climate change, she said.
"I think that there's a trust deficit, no doubt," Granholm said to the council, a committee created to share oil and gas industry input. "A number of us have been protested off the stage as a result of the impatience that's out there" for moving quickly enough to address climate change.
Oil and gas executives have often said they are being unfairly targeted by activists and the broader public over their contributions to climate change. Industry officials feel they have gotten insufficient credit for the emission cuts enabled by coal-to-gas switching, the growth of LNG and work on clean energy, particularly in discussions at the UN Cop 28 climate conference in Dubai.
But high-ranking officials in President Joe Biden's administration say although it has been encouraging to see the oil and gas industry make commitments at Cop 28 to cutting emissions from their operations, the industry still generates vast volumes of emissions and currently only accounts for an estimated 1pc of the global investments in clean energy technology.
"Rhetoric is one thing, and there's an awful lot of rhetoric in these climate conferences," US deputy energy secretary David Turk told the council. "I tend to follow the investment picture and who's investing where, and I think there's some stark numbers there."
The hundreds of billions of dollars in federal tax incentives and grants for clean energy in the Inflation Reduction Act and the bipartisan infrastructure law are trying to "make it easy for investors to make the decision to invest in clean energy," Granholm said. To overcome the trust deficit on climate, Granholm said the oil sector needs to make "bold and loud and clear" verified action to cut down on their emissions and enable the growth of clean energy technology.
"People on both sides of this are not going to hold hands and sing Kumbaya," Granholm said. "But I do think there is an opportunity for those represented in this room to continue to amplify what you all are doing in investing and curbing emissions."
Oil executives say they see growing recognition at events like Cop 28 that their expertise in large-scale projects is needed to meet the challenge of switching to a lower-emissions energy supply. ExxonMobil chief executive Darren Woods, chair of the National Petroleum Council, said the problem of addressing climate change needs more people "at the table" trying to come up with solutions.
"We have the technology, we have the scale, we have the project expertise, we have the experience of building brand new value chains all around the planet," Woods said. "And so who is better equipped to try to address this than the industry that built the existing energy system?"
