This morning the oil-and-gas giant Equinor rolled out new climate plans that include a pledge to cut carbon intensity (that is, emissions per unit of output) by at least 50% by 2050.
Why it matters: The 2050 commitment covers not only emissions from its own operations, but the vastly larger pollution from the use of its products in the economy, known as Scope 3 emissions.
- It adds to what remains a very small handful of oil companies with any kind of targets around Scope 3.
- The move comes amid rising activist and investor pressure on oil giants over global warming.
Where it stands: The Norway-based multinational also said that it plans to grow its renewable energy portfolio by a factor of 10 by 2026, targeting 4-6 gigawatts of capacity.
- The company said it intends to become a "global offshore wind major."
- In addition, Equinor said it wants its direct operations to be carbon neutral by 2030.
What's next: BP, a bigger global player than Equinor, will unveil updated climate plans next Wednesday, which, per Reuters, are also expected to include some kind of Scope 3 element.
- The last 24 hours have only intensified the spotlight on BP.
- In addition to Equinor's move, Greenpeace protestors yesterday temporarily shut down BP's London offices and nine people were arrested, per multiple reports.
- It occurred on the first day of longtime BP executive Bernard Looney's tenure as CEO.
Quick take: Equinor's announcement signals that addressing Scope 3 is quickly becoming the new table stakes at a time of growing pressure on the oil industry.
The sector has been expanding its investments in low-carbon tech and startups, but that remains a very small fraction of overall spending.
- The specifics of BP's plan will matter a lot. Equinor's plan is an intensity target, not an absolute reduction goal.
- The big Spain-based oil company Repsol in December pledged to reach net-zero absolute emissions, including Scope 3, by 2050.
What they're saying: "Equinor's announcement substantially raises the bar for how BP's commitment will be judged," Andrew Logan of the sustainable investment advocacy group Ceres tells Axios.
"Anything that doesn't include a substantial commitment to lower Scope 3 emissions will be seen as falling short," he added.
- Edward Mason, head of responsible investment of the Church Commissioners for England, said this morning on his personal Twitter feed that Equinor is doing "some great stuff," but added:
- "I’m not sure a pledge to halve carbon intensity by 2050 does it any more. #Repsol has shown the net zero 2050 ambition we need." (H/t @ronbousso1)