Hypocrisy of fossil fuel energy companies - a Letter to the Editor from WWCE chair
After a winter which has seen household budgets pushed to breaking, people in Wiltshire can at least breathe a sigh of relief that the Chancellor heeded the calls from people’s favourite Martin Lewis to cancel the planned increase in the Energy Price Guarantee. However, the struggle continues for most as we face double-digit inflation which is simultaneously driving up the cost of essentials like food, as government support for energy bills tapers off.
It’s why we at Wiltshire Wildlife Community Energy felt driven to launch our Keeping Warm This Winter initiative, and why we’ve continued to work with local people to better understand how they can insulate their homes to these rising costs.
Despite the welcome U-turn, energy bills are still calculated to rise by £285 a year for the coming financial year 2023/24, which makes the obscene levels of profit that we’re seeing from petrochemical giants increasingly difficult to swallow. Many Wiltshire residents have spent this winter of discontent having to choose between heating and eating, while the likes of BP and Shell unveiled mega earnings, announcing record annual profits of £23bn and £32bn respectively thanks to soaring fossil fuel prices and rebounding demand.
Given these mammoth takings and the push to deliver greater energy security, one would think that investment in renewables would at least be high on the agenda. Not so. More is being returned to shareholders than given over to research into renewables and one has to ask whether, in years to come, these companies will be regarded with the same disdain as cigarette manufacturers. Like them, the energy giants are well aware of the polluting effects of their products on society.
Last year, Channel 4 News reviewed the accounts of four of Europe’s largest oil and gas companies – BP, Shell, TotalEnergies and Equinor. It found that, in the first six months, they made a total of more than £74bn in pre-tax profits. Of that, BP invested £300m into renewables and low carbon in the first half of 2022 — equivalent to just 2.5 per cent of its £12.2bn profits. It invested £3.8bn in new oil and gas projects. Shell invested equivalent to 6.3 per cent of its £17.1bn profits into low carbon energy, but nearly three times more in oil and gas. What’s more, BP has recently announced its plans to scale back its existing climate goals for reducing emissions from a target of 35-40 per cent, down to 20-30 per cent by the end of the decade, reneging on some of its key pledges.
Previous research had already found that many of those claims amounted to ‘greenwashing’ as it was, so to row back on even those promises represents a real failure to take climate change seriously. Throwing around buzzwords doesn’t change the planet’s outlook. Darren Jones, chair of the BEIS Select Committee, quite rightly pointed out that renewable spending is the true litmus test of petrochemical firm’s commitment to the climate. If a huge proportion of your investments already go towards fossil fuels and you then set out your stall to increase those investments, how can you still claim to be committed to achieving large scale carbon reductions? Through faux investment these businesses are able to avoid tax and so it’s my view that there should be stronger linkage between proven investment in renewables and taxes to incentivise real, demonstrable change from the industry’s biggest hitters.
It’s time these petrochemical giants start putting their money where their mouths are, prioritising the wellbeing of their customers and the future of the planet over profit.
Julian Barlow, chair of WWCE
Letter to Editor published in the Swindon Advertiser on 27th April 2023