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Oil Companies’ Investments in Dirty Fuels Outpace Clean Fuels by Fifty Times

By Climate Guest Contributor on December 15, 2011 at 8:23 am

"Oil Companies’ Investments in Dirty Fuels Outpace Clean Fuels by Fifty Times"

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Size of oil industry production investments and subsidies (globally) over the past five years (2006 to 2010).

by Simon Mui, in an NRDC Switchboard cross-post

NRDC has long supported efforts by companies to invest in cleaner technologies. We have started tracking oil industry investments in renewable fuels such as advanced biofuels, down to the company level. In a new analysis, NRDC compares those investments to traditional investments in conventional oil production and even dirtier unconventional sources such as tar sands.

For years, the oil industry has promoted itself as getting cleaner and investing in alternatives to oil. But when it comes to transportation fuels – still their main business – are  oil companies truly going green and investing in cleaner alternatives to oil?

NRDC to Oil Companies: “Actually, We Don’t Agree”

Based on our research of the overall industry, our conclusions is a resounding “NO”.  The oil industry as a whole has spent at least fifty (50x) times in producing more dirtier fuels sources such as tar sands than their entire global investments in producing renewable fuels. I note that this does not include oil industry investments in other dirtier fuel sources such as oil shale, extra-heavy oil, and coal to liquids.

Breaking it down on a global basis: the oil industry’s investment over the past five years amounted to

  • $2090 billion in capital expenditures to find and produce more oil, of which
  • $190 billion went to producing dirtier tar sands
  • $4 billion in renewable fuels

Results like these will not surprise skeptics of the oil industry. But the trend is especially unsettling for motorists in places like California where the state’s Low Carbon Fuel Standard (LCFS) is being attacked by the oil industry. Oil companies are spending hundreds of millions to convince the public they are investing in renewable energy and cleaner fuels, but also simultaneously trying to weaken and slow down clean fuel standards. The latter would ensure they are increasing their portfolio in cleaner, alternative fuels and not just saying they are.

The industry group Western States Petroleum Association, together with California based Chevron, is now on track to spend $7 million in lobbying in California alone, the highest of any other industry group.

So what can be done? NRDC is working to protect the Low Carbon Fuel Standard against oil industry attacks. Join us in asking the California Air Resources Board to tell Big Oil that “We Agree: Oil Companies Should Invest More on Cleaner Fuels than Dirtier Ones.”

Already, thousands of citizens are starting to weigh in. Do Californians care? To paraphrase the famous Chevron campaign, “People Do.”

Submit your comments at:

http://www.arb.ca.gov/lispub/comm/bcsubform.php?listname=lcfs2011&comm_period=A

or write to: Clerk of the Board, California Air Resources Board, 1001 I Street, Sacramento, CA 95814.

Simon Mui is a Scientist with the Clean Vehicles and Fuels program at NRDC in San Francisco. This post was originally published at the NRDC Switchboard blog.

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5 Responses to Oil Companies’ Investments in Dirty Fuels Outpace Clean Fuels by Fifty Times

  1. Solar Jim says:

    Thanks Simon.

    Also notice that $2090 bn versus $4 bn for “renewable fuels” is closer to 500 to 1, or irrelevant for “sustainability.”

    Furthermore, that petroleum (and more generally fossil and atomic) global profits are of the same scale as global nation-state subsidies, for what are essentially extraction and contamination via these nation-state sanctioned corporate practices (without accounting for militarism expenditures associated with oil, geopolitical consequences associated with resource dependency and nuclear proliferation, health degradation, public impoverishment or climate destabilization)?

    Without those hundreds of billions of annual nation-state subsidies (see for example IEA, 2011) would the actual energy-by-mining paradigm marginal advantage (vs. local sustainable economics) be zero?

    Call us fossil fools in an atomic era (or error). Or a global economy of gas (and economic hubris), carbonic acid gas to be precise.

    • Mulga Mumblebrain says:

      500 to one, eh. That sounds like the ratio of a CEO’s wage to that of the average serf whose labor produces all the wealth appropriated by the Boss.

  2. The sensible thing to do is use dirty carbon energy only to manufacture and deploy clean energy. Otherwise tax carbon heavily.

  3. Joan Savage says:

    The companion economic question: are the consumers of transportation fuels going green and investing in cleaner alternatives to oil? or more frugal uses?

    Right now it seems a pipe dream, but I’d like to see rechargeable electric run local commercial distribution and public transportation, and long-haul transport be largely by rail.

    Consumer decisions like buying a fleet of electric vans or contracting for efficient long-haul by rail would have some impacts on the oil market such as its distribution system, its price mark ups, and the profitability of unconventional dirty oil.

    • Mulga Mumblebrain says:

      Joan, in Austr-failure solar photovoltaics and electric cars are currently being ferociously attacked by the market absolutist zealots in the civil service for driving up electricity prices. They seem determined to destroy both industries. So, please, never imaging this country is rational, humane or morally sane. It is the Land of the Lotus Eaters who adamantly refuse to face reality.