Big Oil is coming out of the closet. Exxon Mobil confirmed earlier this month in a Bloomberg Businessweek article that they support a carbon tax. Shell and BP have signed a Climate Price Communiqué that was distributed on 29th November at the eighteenth Conference of the Parties to the United Nations Framework Convention on Climate Change, which is meeting in Doha, Qatar, this week and next.
The most obvious reason why big oil and gas companies would support a huge new tax on their own products is that it would kill coal first. Burning coal emits roughly twice as much carbon dioxide as producing the same amount of energy by burning natural gas. A $20 a ton of CO2 tax would roughly double the current price of coal used for producing electricity. That would provide a huge incentive for utilities to switch to natural gas. Exxon Mobil owns the world’s largest privately-owned reserves of natural gas. Shell and BP also own huge gas reserves.
The Climate Price Communiqué states that, “Putting a clear, transparent and unambiguous price on carbon emissions must be a core policy objective.” They mean a global price, but a U. S. domestic carbon tax could fit comfortably into their plans.
The communiqué was organized by the Prince of Wales’s Corporate Leaders Group on Climate Change and is managed by the University of Cambridge’s Programme for Sustainability Leadership. One-hundred forty companies have signed on, but Shell and BP are among just a handful of major corporations.
Amusingly, an article posted on the Center for American Progress’s ThinkProgress web site claimed that the signers were “leading global companies.” Here’s the list of North American companies: Actio, Aimia, Bullfrog Power, Business Council for Sustainable Energy, Climate Wedge, Delphi Group, Eco-kraft, EOS Climate, Horizon Capitol Holdings, Events Outside the Box, Mountain Equipment Co-Op, Offsetters, Pacific GPS, Westport, and Wildlife Works.