Unlikely allies to price carbon in the oil and gas industry

oil refinery

Unlikely allies to price carbon in the oil and gas industry

By Liz Fisher

Citizens’ Climate Lobby (CCL) has some unlikely allies in the fossil fuel industry. Major oil and gas companies are actually pushing for a revenue-neutral carbon tax (RNCT).  They make the same arguments as CCL – it’s predictable, simple, transparent, and fair. There are other reasons they like it. Coal’s CO2 emissions are about twice those from natural gas for the same amount of energy, so a tax on carbon will cede coal market share to natural gas. It will also make the carbon-capturing technologies they’ve been working on more economically attractive.

In 2016, congressional staffers, other oil companies, the American Petroleum Institute, and the American Fuel and Petrochemical Manufacturers told the Wall Street Journal that ExxonMobil had been lobbying them for an RNCT. This assertion was confirmed in an article in Hybrid Cars. When Rex Tillerson was ExxonMobil’s CEO, he argued eloquently for a carbon tax in a speech to the Economic Club of Washington D.C. He suggests (at 28 minutes, 42 seconds in this recording) “returning the tax revenue back to consumers through reduction in other taxes — payroll taxes or a simple dividend.”

Before the 2015 Paris conference, European oil companies (BP, BG Group, Eni, Total, Royal Dutch Shell, and StatOil) wrote a letter to Christiana Figueres, Executive Secretary of the United Nations Framework Convention on Climate Change. They asked that she “introduce carbon pricing systems where they do not yet exist at the national or regional levels, and create an international framework that could eventually connect national systems.” StatOil also attended the first meeting of the U.S. House of Representatives’ Climate Solutions Caucus on April 30, 2016, and lobbied for a carbon tax. At CERA Week (March 6 – 10), the “Superbowl of the energy policy conferences,” energy executives voiced widespread support again this year for a price on carbon per Samantha Gross at Brookings and new Exxon CEO Darren Woods confirmed Exxon’s continued commitment to a Revenue Neutral Carbon Tax.

We need not view oil and gas companies as great friends of the environment. It’s not their first priority. ExxonMobil has been accused of knowing about the dangers of climate change for decades while still denying its impact or urgency. Nevertheless, for today’s efforts to address climate change, we should leverage, not deny, their support for a carbon tax.

CCL volunteer Liz Fisher is a member of the Oil Action Team.


Steve Valk
Steve Valk is Communications Coordinator for Citizens' Climate Lobby. Steve joined the CCL staff in 2009 after a 30-year career with the Atlanta Journal-Constitution. Follow him on Twitter at @valklimate.