Smart Money Abandoning Renewable Energy

Commentary by Marita Noon - British Petroleum is still one of the world’s biggest oil companies. But as early as the late 1990’s they didn’t want you think of them that way. CEO Lord John Browne of Madingley argued that “the transition to alternatives could be accelerated by changing industry practices today.” While other oil companies eschewed climate change alarmism, BP embraced it. In 2002, Lord Browne declared: “Climate change is an issue which raises fundamental questions about the relationship between companies and society as a whole, and between one generation and the next,”
     As a result, Mother Jones reported in 2006: “BP vowed to cut its own CO2 emissions and invest heavily in solar, wind, and other alternative technologies; it even supported … the Kyoto climate treaty.” BP jumped into renewables and their moniker underwent an evolution from British Petroleum to BP, then to Beyond Petroleum. Between 2000 and 2005 BP invested $500 million into solar power and $30 million on wind and have invested more than $4 billion in alternative energy in the US since 2005.  ExxonMobil didn’t agree.
     ExxonMobil took a different course. In 2005, then-CEO Lee Raymond, said: “What all these people are thinking about doing, we did 20 years ago—and spent $1 billion, in dollars of that day, to find out that none of these were economic.” “In the late 1970s, as oil prices skyrocketed, Exxon diversified into an array of fossil-fuel alternatives, including nuclear and solar energy.” “After several years, Exxon still couldn't see prospects for renewable energy turning into a money-maker, especially since oil prices were falling in the 1980s. In the mid-1980s, the company decided to get out of the business.”
     Andrew Logan of Ceres, a Boston-based environmental group, sees two possible scenarios: “One is that all the scientists in the world are wrong, in which case there’s no climate change, in which case Exxon will do well.” He then says: “But if the scientists are correct and we have to find a way to transform the way we use energy, then Exxon is going to lag significantly behind its competitors.”
     It is obvious now, nearly a decade later, which was the sound strategy. Global warming is not the manmade crisis it was predicted to be in the mid-2000s and we know that oil is “going to last a whole heck of a lot longer.” Today, innovation and imagination are producing record quantities of domestically produced oil and gas. Robert Bryce reports: “we won’t hit peak oil until we hit peak imagination.” And, Exxon’s Raymond made the right choice to get out of renewable energy. Read more

Smart Money Abandoning Renewable Energy