Big Oil's Embrace of Carbon Pricing Called PR Ploy to 'Avoid Real, Effective Climate Action'

The American Petroleum Institute on Thursday expressed support for carbon pricing—a move that some heralded as a “major shift” for the country’s most powerful dirty energy lobbying group that has long opposed regulatory efforts to curb planet-heating greenhouse gas emissions.

Progressive critics, however, characterized the decision as a form of “self-serving greenwashing” designed to forestall the kind of action necessary to address the climate crisis.

“Nobody should fall for the oil industry’s new PR ploy, which will do nothing to fight the climate emergency.”
—Kassie Siegel, Center for Biological Diversity

“We support a price on carbon,” Frank Macchiarola, API’s senior vice president for policy and regulatory affairs, said Thursday during a meeting with the Interior Department and other climate policy stakeholders. “This has been long debated within industry and within government, and we think it’s the most impactful way to address the risks of climate change.”

Rather than endorse a specific plan, API president Mike Sommers told officials in the Biden administration that “what we’re advocating here is a market-based approach and that could encompass many different ways to do this.” He added that “it could encompass an economy-wide… carbon tax or it could include a market price on emissions,” such as a cap-and-trade system.

While “API did not say how big a carbon tax should be,” the Washington Post reported that “many of its members have long used $40 a ton as an internal price to judge the viability of their projects.” Economists, however, have estimated that “a price two or three times as large would be needed to change behavior enough to effectively curb greenhouse gasses.”

CNBC noted that “the industry envisions changes to existing regulations following a carbon price policy endorsement.”

Critics from environmental groups described API’s announcement as Big Oil’s latest public relations strategy and warned that it deflects attention from the necessity of reducing GHG emissions and transitioning to 100% renewable energy as rapidly as possible.

“Nobody should fall for the oil industry’s new PR ploy, which will do nothing to fight the climate emergency,” Kassie Siegel, director of the Center for Biological Diversity’s Climate Law Institute, said in a statement. “API is trying desperately to distract the Biden administration from the crucial work of keeping polluting fossil fuels in the ground.”

API was not alone in throwing its support behind the idea of the federal government putting a price on carbon emissions. As CNBC reported, leaders from fossil fuel corporations “such as ExxonMobil, BP, Chevron, and ConocoPhillips, along with API, also signaled support for market-based carbon pricing” during a virtual meeting with White House officials Monday.

The dirty energy industry’s endorsement of carbon pricing occurred as details—including potential sources of funding—emerged about President Joe Biden’s $3 trillion infrastructure proposal, which green job advocates have criticized for being inadequate. Biden has vowed to put the U.S. on a path toward net-zero emissions by mid-century.

“Fossil fuel executives have knowingly lied and deceived the public about the devastating impacts that burning coal, oil, and gas has on our climate for decades. Now at the 11th hour, while our communities reel from climate impact after climate impact, they are endorsing a false solution.”
—Natalie Mebane, 350.org

Natalie Mebane, policy director at 350.org, said in a statement that “the American Petroleum Institute and fossil fuel executives have knowingly lied and deceived the public about the devastating impacts that burning coal, oil, and gas has on our climate for decades.”

“Now at the 11th hour, while our communities reel from climate impact after climate impact, they are endorsing a false solution,” she continued. “This is yet another greenwashing tactic wielded by the fossil fuel industry to distract from their disproportionate responsibility for the climate crisis.”

Kyle Herrig, president of Accountable.US, concurred. He said that decades of undermining climate science and fighting “meaningful efforts to meet the climate crisis head on” means that API “cannot be trusted.”

In her statement, Mebane added that “carbon pricing is not a primary solution to the climate crisis. In fact, fossil fuel corporations like Exxon, BP, Chevron, and ConocoPhillips must pay for the damage they’ve done to people and the planet.”

As Common Dreams reported, three environmental justice and corporate accountability groups filed a “first-of-its-kind” complaint with the Federal Trade Commission last week in which they accuse oil giant Chevron of misleading the public by overstating its commitment to reducing emissions and investing in clean energy while continuing to extract fossil fuels that put vulnerable communities in harm’s way.

Siegel, for her part, emphasized that “Biden must not allow rich oil companies [to] escape climate accountability with yet more self-serving greenwashing announcements, but instead should declare a climate emergency and permanently halt the leasing of public land for drilling and fracking.”

Despite promising on the campaign trail to stop fracking and fossil fuel extraction on public lands, Biden earlier this month came under fire for not renewing the Interior Department’s policies limiting oil and gas drilling on federal lands and waters.

Referring to the climate emergency, Mebane said that “in order to truly combat this crisis, federal support for the oil and gas industry and all new fossil fuel projects must stop immediately and we must create millions of new clean energy jobs, while leading a just transition to an equitable future.”

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