Research shows industry lobbying against support for solar panels and electric cars while enjoying subsidies itself
Ajit Niranjan
THE GUARDIAN
Fri 8 Mar 2024
The oil industry has fought against government support for clean technologies for more than half a century, the Guardian can reveal, even as vast subsidies have propped up its polluting business model.
It lobbied lawmakers to block support for low-carbon technologies such as solar panels, electric cars and heat pumps as far back as the 1960s, analysis shows. Trade associations in the US and Europe stymied green innovations under the guise of supporting a “technology neutral” approach to avoiding the damage done by burning their fuels.
The same incumbents were happy to lobby for government support when they were getting started, and had continued to benefit from it since, said Dario Kenner, a visiting research fellow at the University of Sussex who trawled through decades of public statements from the American Petroleum Institute (API) and FuelsEurope.
“It’s obviously hypocritical to call for technological neutrality when you are the dominant technology,” he said.
Kenner documented dozens of examples of the oil industry pressuring governments to hold back support for renewable energy, restrict funding for the development of clean technologies and weaken environmental rules that favoured their uptake.
Lobbyists on both sides of the Atlantic argued that government subsidies for clean technologies distorted free markets. Activists say their position is “dishonest” because the oil industry benefits from tax credits and other financial help from governments, and pays for only a fraction of the damage its fuels do to people and the planet.
In 2022, the total subsidies for fossil fuels – including costs to society – came to $760bn (£592bn) in the US and $310bn (£264bn) in the EU, according to the International Monetary Fund.
The revelations were “outrageous but frankly unsurprising”, said Shira Stanton from the campaign group Beyond Fossil Fuels, who was not involved in the analysis.
“It has been proven that the fossil fuel industry caused the climate crisis and deliberately lied about it as they hid the science,” she said. “So finding out that they knew renewable energy was such a threat to their industry that they had to lobby policymakers to rig the market against cleaner and cheaper technology to protect profits is just par for the course.”
Some interventions may have slowed the growth of technologies that scientists say are key to stopping the planet from heating.
In 1975, after a global oil crisis, the API opposed an energy saving bill that included refundable income tax credits for heat pumps in homes.
“The United States has a large resource base of conventional energy such as oil, gas and coal,” it said. “Expeditious development of these supplies can make a significant contribution not only to improving US energy independence, but to create a healthy economy.”
Some of the industry’s early efforts to hold back competition later helped it argue that society could not do without it.
In 1967, the API protested against a bill to promote the development of electric cars with the argument that governments should “stimulate all efforts by industry to eliminate automotive pollution, rather than dedicate federal funds to the promotion of any single possible solution”.
But half a century later, in 2005, its lobbyists fought a bill to support electric cars with the argument that they were not developed enough.
“The United States, and the world, cannot afford to leave the age of oil before realistic alternatives are fully in place,” said Red Cavaney, the then president of the API. “It is important to remember that man left the stone age not because he ran out of stones – and we will not leave the age of oil because we ran out of oil.”
The oil industry has fought against government support for clean technologies for more than half a century, the Guardian can reveal, even as vast subsidies have propped up its polluting business model.
It lobbied lawmakers to block support for low-carbon technologies such as solar panels, electric cars and heat pumps as far back as the 1960s, analysis shows. Trade associations in the US and Europe stymied green innovations under the guise of supporting a “technology neutral” approach to avoiding the damage done by burning their fuels.
The same incumbents were happy to lobby for government support when they were getting started, and had continued to benefit from it since, said Dario Kenner, a visiting research fellow at the University of Sussex who trawled through decades of public statements from the American Petroleum Institute (API) and FuelsEurope.
“It’s obviously hypocritical to call for technological neutrality when you are the dominant technology,” he said.
Kenner documented dozens of examples of the oil industry pressuring governments to hold back support for renewable energy, restrict funding for the development of clean technologies and weaken environmental rules that favoured their uptake.
Lobbyists on both sides of the Atlantic argued that government subsidies for clean technologies distorted free markets. Activists say their position is “dishonest” because the oil industry benefits from tax credits and other financial help from governments, and pays for only a fraction of the damage its fuels do to people and the planet.
In 2022, the total subsidies for fossil fuels – including costs to society – came to $760bn (£592bn) in the US and $310bn (£264bn) in the EU, according to the International Monetary Fund.
The revelations were “outrageous but frankly unsurprising”, said Shira Stanton from the campaign group Beyond Fossil Fuels, who was not involved in the analysis.
“It has been proven that the fossil fuel industry caused the climate crisis and deliberately lied about it as they hid the science,” she said. “So finding out that they knew renewable energy was such a threat to their industry that they had to lobby policymakers to rig the market against cleaner and cheaper technology to protect profits is just par for the course.”
Some interventions may have slowed the growth of technologies that scientists say are key to stopping the planet from heating.
In 1975, after a global oil crisis, the API opposed an energy saving bill that included refundable income tax credits for heat pumps in homes.
“The United States has a large resource base of conventional energy such as oil, gas and coal,” it said. “Expeditious development of these supplies can make a significant contribution not only to improving US energy independence, but to create a healthy economy.”
Some of the industry’s early efforts to hold back competition later helped it argue that society could not do without it.
In 1967, the API protested against a bill to promote the development of electric cars with the argument that governments should “stimulate all efforts by industry to eliminate automotive pollution, rather than dedicate federal funds to the promotion of any single possible solution”.
But half a century later, in 2005, its lobbyists fought a bill to support electric cars with the argument that they were not developed enough.
“The United States, and the world, cannot afford to leave the age of oil before realistic alternatives are fully in place,” said Red Cavaney, the then president of the API. “It is important to remember that man left the stone age not because he ran out of stones – and we will not leave the age of oil because we ran out of oil.”
An electric car charging point in London. Lobbyists on both sides of the Atlantic argued that government subsidies for clean technologies distorted free markets. Photograph: Zeynep Demir Aslim/Alamy
FuelsEurope, which has also fought support for electric vehicles for more than a decade, pushed to weaken EU fuel efficiency standards in 2017 so they would allow combustion engine cars burning alternative fuels. Critics say the low-carbon fuels with which it wants to power cars are expensive, inefficient and in such short supply that they would be better used in planes and ships, which are harder to run on electricity.
The oil industry had moved from denying climate change to derailing climate action, said Anna Krajinska, a vehicles analyst at the campaign group Transport and Environment, which was not involved in the analysis.
“The push for tech neutrality – particularly ‘carbon neutral’ fuels for road transport – is a disingenuous attempt to keep combustion engines burning fossil fuels,” she said.
Some of the world’s biggest oil companies have invested in clean energy projects as they have come under increasing pressure from activists, investors and governments. Armed with big wallets and skilled engineers, they have argued they can lead the transition to a carbon-neutral economy.
But a report from the International Energy Agency (IEA) in November found that oil and gas companies accounted for just 1% of clean energy investments. It described the sector as a “marginal force at best” in the transition.
Kenner said it was “ludicrous” to debate an individual oil company’s transition plans when the industry had spent so long fighting clean alternatives that threaten its market share.
“As part of trade associations and lobby groups, they have been deliberately trying to undermine the same technologies that people want them to invest in,” he said.
The IEA report found that oil and gas producers would have to spend 20 times more of the capital on clean energy – rising from 2.5% in 2022 to 50% in 2030 – to line up with the Paris agreement goal of keeping the planet from heating 1.5C (2.7F) above pre-industrial levels by the end of the century.
Christina Figueres, a Costa Rican diplomat and architect of the agreement, told the Guardian before the Cop28 climate summit in November that she used to believe the industry needed a seat at the table but had lost hope after seeing it use windfall profits since the war in Ukraine to enrich shareholders – instead of reinvesting them in clean energy.
The API and FuelsEurope said they were working to reduce emissions.
The API said: “America’s natural gas and oil industry is working to address the risks of climate change and build a lower-carbon future, while simultaneously meeting the world’s growing energy needs. Our members continue to make significant progress in reducing greenhouse gas emissions across their operations, while also leading in the development of low-carbon solutions like carbon capture and storage and hydrogen that are critical to meeting the world’s greenhouse gas emissions reduction targets.”
FuelsEurope said: “FuelsEurope can state that our industry is transforming, and we have developed a comprehensive pathway of how we, together with our partners, can contribute to meeting the 2050 climate neutrality challenge. By 2050, at the latest, every litre of liquid fuel for transport could be net climate neutral, enabling so, together with all existing and proven sustainable alternative technologies, the decarbonisation of aviation, maritime and road transport, and the refinery products supplying the industrial value chain could also be net zero CO2.”
Kenner compared the industry’s lobbying to gas lighting companies who fought the arrival of electric street lights, and canal companies who protested against new railways. By fighting off support for emerging competitors, the industries slowed the transition to new technologies.
“We know from the history of technological change that it’s often the companies with the new technologies that push it forward – it’s not usually the incumbents,” said Kenner. “Blockbuster video was not going to get to Netflix online streaming.”
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