I have long been flabbergasted that more corporate in the fossil fuel industry didn’t realize there was tons of money to be made in renewables and that grabbing hold of those resources early on would mean lots of profits in the long run. Now that the price of renewables is dropping rapidly, maybe some fossil fuel companies are finally going to get smart.
So has the fossil fuel industry finally woken up to the dangers posed to their futures by a move to a low-carbon world, or is this all “greenwash” – relatively insignificant investments designed to shake off critics?
Or does it just make good business sense for Big Oil to do this at a time when oil prices are low, renewable projects look like steady long-term investments, and green businesses can be snapped up on the cheap?
Some of the moves certainly have serious amounts of cash behind them. Total of France, for instance, announced two weeks ago that it planned to spend nearly €1bn on buying 100-year-old battery manufacturer Saft. Chairman and chief executive Patrick Pouyanné said the deal would “allow us to complement our portfolio with electricity storage solutions, a key component of the future growth of renewable energy”.
There’s other good news presented in this piece as well. But of course there’s a lot of reason to be skeptical:
Even Exxon Mobil, often dismissed by climate change activists as the most conservative oil company of them all, has recently unveiled plans to investigate CCS more fully in a new partnership with a fuel cell company.
But some of the sums being invested are quite small: the Shell New Energies, for example, has a capital expenditure budget of just under 0.5% of its total. And oil companies do have form for shouting loudly about moving into renewables only to beat a hasty retreat.
BP in particular was pilloried for promising to go “beyond petroleum” – then running down its alternative energy division. Shell used to have a very big solar business, but this was scaled down several years ago.
Environmentalists are increasing the pressure on oil companies by accusing them of trying to slow the march to low-carbon energy, if not of being the climate-change deniers some were of old.
There are even claims that Big Oil has been deliberately infiltrating renewable energy lobby groups so that it can push its agenda of keeping gas, in particular, as a “transition fuel” of the future – something the companies deny.
So we will see. Someone is eventually going to make a whole lot of money in this industry. Whether it’s the current players in fossil fuels remains to be seen.