Oil companies commit to ‘economically meaningful’ carbon pricing — but what does that mean?

A number of major oil companies expressed their commitment to “economically meaningful” carbon pricing following a Vatican summit on climate change this Friday.

The companies released a joint statement today in apparent support of carbon pricing. From the Associated Press:

The companies, including ExxonMobil, BP, Royal Dutch Shell, Total, Chevron and Eni, said in a joint statement Friday that governments should set such pricing regimes at a level that encourages business and investment, while “minimizing the costs to vulnerable communities and supporting economic growth.”

CEOs of those companies also expressed a desire to offer further clarify to investors the financial risks of climate change, including details about internal plans to transition to clean energy.

The AP notes the statement “was issued at the end of a closed-door summit and a personal appeal by Pope Francis.”

During the summit, Pope Francis discussed the necessity of a “radical energy transition” to clean, low-carbon power with the executives, urging a “prompt and resolution action.”

Francis said carbon pricing was “essential” to addressing climate change, as he also made an appeal for “open, transparent, science-based and standardized” climate risk reporting, according to a Reuters report from the summit.

Electrek’s Take

Let’s take a closer look at that joint statement, based on the report. There are two parts that we know of at this point: encouraging business and investment, and “minimizing the costs to vulnerable communities and supporting economic growth.”

Encouraging business and investment. Supporting economic growth. No apparent mention of transitioning clean energy sources, and certainly no mention of what the actual pricing might be.

As for vulnerable communities — what could hurt more than how air pollution already affects those communities?

So what kind of a statement is this? To us, it seems this is something you might say before you agree to carbon pricing…at a ridiculously low price. We can hear the argument already:

“We agreed to carbon pricing. That’s what you wanted, wasn’t it? But we can’t do it at those prices. It doesn’t make business sense.”

Carbon pricing wouldn’t be a total solution at this point, but it would still be a massive piece of the puzzle when it comes to reducing emissions and transitioning to clean energy. It’s far from a new idea, and some governments use it already, but as Democrats craft their climate/energy plans moving forward, we may hear about it more once again in the US. John Oliver already got deep into the subject on his HBO show last month.

So oil companies, let’s see some numbers. Are we talking $50/ton? Or is it $5? When it comes to this embrace of “meaningful” carbon pricing, we’ll believe it when we see it.