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ExxonMobil urges financiers to push for carbo pricing, low-carbon incentive policies
The vice president of ExxonMobil's new low-emission technology business called on financiers to join the energy industry in pushing for policies that incentivize investments in low carbon developments, especially policies that would introduce carbon pricing.
ExxonMobil's Low Carbon Solutions business was created in March to commercialize technologies like carbon capture and storage, biofuels and hydrogen. In November, the company announced a $15 billion investment over the next 6 years to reduce greenhouse gas emissions from its operations, with a significant portion of that amount going towards Low Carbon Solutions.
During a Dec. 8 panel at the 23rd World Petroleum Congress, Vice President Scott Darling highlighted how the company prioritizes environmental, social and governance criteria into its investment decisions and pushed other financial institutions to become ESG advocates in the policy arena.
"I hope our financial partners will join us in advocating for comprehensive and actionable policy that incentivizes investment and solutions that are supportive of society's ambitions of a lower carbon solution," Darling said.
One of the key ways to drive those investments, he added, is a transparent price on carbon, which he described as "the most effective way to reduce greenhouse gas emissions at the lowest cost to society."
It's not the first time ExxonMobil has pushed for carbon pricing. The company's position on the policy became a center of controversy earlier this year after Greenpeace activists released a video of an ExxonMobil lobbyist unwittingly sharing the company's lobbying tactics to a Greenpeace investigator posing as a headhunter.
In the video, lobbyist Keith McCoy said that the company's public support for a carbon tax, which has been treated by Democrats as a politically risky policy, is used as more of a talking point than a serious proposal. ExxonMobil CEO Darren Woods called McCoy's comments "disturbing and inaccurate," and reinforced the company's support for a carbon tax.
Darling repeated the company's carbon tax stance Dec. 8.
"The effect of carbon markets and pricing can be powerful tools to encourage the development of low carbon technologies and provide a clear financial incentive to attract public and private investment to lower emissions," he said.
Carbon tax legislation
Leaders from around the energy industry have often highlighted carbon pricing as the fastest pathway towards decarbonization in the US, although many doubt the measure's chances of passing through Congress. Although a carbon tax was floated as an idea to pay for President Biden's $1.2 trillion infrastructure bill, it failed to materialize over fears of potential impact on consumer goods prices.
Five other carbon pricing proposals have been introduced this year, according to the Center for Climate and Energy Solutions. The center also reports that the Senate Finance Committee is considering inclusion of a carbon price in the Biden Administration's Build Back Better Act.
Twelve states already have carbon pricing in action, and a number of others are considering similar policies.
Meanwhile, voluntary carbon markets have made significant gains this year as carbon credit prices surged in October and November before dropping slightly in early December. According to Platts price assessments, CORSICA-eligible carbon credits were valued at $8.15/mt CO2e on Dec. 8. Nature-based carbon credits were valued at $14/mt CO2e.