The Gorgon liquefied natural gas (LNG) and carbon capture and storage (CCS) facility, operated by Chevron Corp., on Barrow Island, Australia, Monday, July 24, 2023.
Bloomberg | Bloomberg | Getty Images
The oil and gas industry must abandon the “illusion” that carbon capture technology is a solution to climate change and invest more in clean energy, the head of the International Energy Agency said Thursday.
“The industry must commit to truly helping the world meet its energy needs and meet its climate goals – and that means abandoning the illusion that implausibly large amounts of carbon capture are the solution,” said the executive director of the IEA, Fatih Birol, in a press release. statement ahead of the United Nations Climate Change Conference in Dubai next week.
The technology captures carbon dioxide from industrial operations before emissions enter the atmosphere and stores it underground.
Oil and gas companies are facing a moment of truth about their role in the transition to clean energy, Birol wrote in an IEA report examining the industry’s role in the transition to a net-zero emissions economy of carbon by 2050.
According to Birol, only 1% of global investment in clean energy comes from oil and gas companies. The industry must face the “uncomfortable truth” that a successful transition to clean energy will require a reduction in oil and gas operations, not their expansion, the IEA chief wrote.
“So while all oil and gas producers must reduce emissions from their own operations, including methane leaks and flaring, our call to action is much broader,” Birol wrote.
The industry should invest 50% of its capital expenditure in clean energy projects by 2030 to meet the goal of limiting climate change to 1.5 degrees Celsius, according to the IEA report. About 2.5% of industry capital spending was dedicated to clean energy in 2022.
One of the main pitfalls of the energy transition is the excessive reliance on carbon capture, according to the report. Carbon capture is essential to achieving net zero emissions in some sectors, but it should not be used as a means of maintaining the status quo, according to the IEA.
According to the IEA, an “inconceivable” 32 billion tonnes of carbon would need to be captured for use or storage by 2050 to limit climate change to 1.5 degrees Celsius based on current projections for oil and gas consumption.
The necessary technology would require 26,000 terawatt hours of electricity to operate in 2050, more than total global demand in 2022, according to the IEA.
It would also require $3.5 trillion in annual investments from today through mid-century, equivalent to the annual revenues of the entire oil and gas industry in recent years, according to the report.
An American oil major like Exxon Mobile And Chevron are investing billions in carbon capture technologies and hydrogen, while European majors Shell And P.A. have focused more on renewable energy such as solar and wind.
Exxon And Chevron They are also doubling their fossil fuel consumption through mega-deals. Exxon is purchase Pioneer Resources for nearly $60 billion, while Chevron purchase Hess for $53 billion.