Six energy companies call for carbon pricing

A number of countries have introduced carbon pricing systems, where companies are charged for their carbon dioxide emissions
A number of countries have introduced carbon pricing systems, where companies are charged for their carbon dioxide emissions

Six leading oil and gas companies Monday called on governments to put into place a carbon pricing system, saying this would be the most effective way of cutting the emission of greenhouse gases.

"We firmly believe that will discourage high options and reduce uncertainty that will help stimulate investments in the right low carbon technologies and the right resources at the right pace," said the chief executives of BG Group, BP, Eni, Royal Dutch Shell, Statoil and Total in a joint letter.

The call by companies comes as France tries to breathe life into talks aimed at reaching a deal on a UN climate pact ahead of a crucial conference in Paris in December.

In the letter to the head of the UN Framework Convention on Climate Change (UNFCCC) and the Paris Conference, the energy companies acknowledged the current trend of exceeds the target of limiting global warming to no more than two degrees Celsius (3.6 degrees Fahrenheit) over pre-industrial levels to save Earth's climate from potentially catastrophic damage.

The companies said they are willing to do their part, but that governments need to provide a clear, stable, and long-term policy framework.

"Pricing carbon obviously adds a cost to our production and our products," they said, but added it would set a level playing field for all energy sources across geographies and a clear role in securing a more sustainable future.

A number of countries have introduced carbon pricing systems, where companies are charged for their .

Europe's system has been seen as a failure as the carbon price plunged after too many carbon credits were distributed for free.

Total chief Patrick Pouyanne told a news conference that to replace coal-fired power stations, which produce twice as much as those which use natural gas, a carbon price of around $40 is needed. The current is about 7 euros ($7.50).

A price of $80-$100 is needed, he said, to justify the investment in carbon capture and storage systems that can capture most of the carbon dioxide emissions produced from the use of fossil fuels in electricity generation and industrial processes.


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Jun 01, 2015
So, let me understand this.

The companies are asking governments to increase the carbon penalty.

Then they can triple the cost to generate power of course passing all of that on to the consumer and blaming the government.

They then get incentives probably equal to or greater than the penalty to purchase new more efficient equipment.

Once the equipment is paid off, the cost of course will remain the same netting the power companies a NICE healthy increase in revenue and the consumer with a sore behind.

Have I got it right?

Jun 01, 2015
Hi Gimp.

The point is to make the market decide what price and methods are optimal to both profitability and service/cost to client/consumer. This allows a sort of 'level playing field' of certainty for all players/alternatives, so breaking the stranglehold of 'entrenched' systems/ways on the market which makes introduction/implementation both slow and sketchy.

See? Your 'analysis/conclusion' omits social/economic/sustainability/opportunity-cost factors which make your comment sound political/personal self-interest rather than scientifically objective.

Remember too, that fossil fuels/plants have involved humongous cumulative subsidies/allowances/damage over centuries now; and that sustainable/cheap alternatives are on the way in making fossil plants/systems 'stranded assets' anyway; so it's the smart Industry member that sees the writing on the wall; and seeks new investment certainty for coming realities. Else stranded for/with their Investments/infrastructure.

Ok? :)

Jun 01, 2015
Good analysis Reality. It is hard to get your head around - a profit motive company - calling for policies that would appear to hurt themselves from a competitive point of view. .


It's clear the world is moving toward renewables. It quite frankly has to. Any company with any long-term planning capability will want the market to be structured to support their expansion into that arena. It won't cause higher electricity prices; that's kind of the point. They can see people getting their energy from other sources cheaper and know they have to get into the game to be competitive long term. A carbon market provides planning certainty for the future. Only the most regressive company wouldn't want that.

Jun 01, 2015
Another example of fascism in action.

Over 100 years ago the top 5 meat packers asked and supported the creation of the Food and Drug Administration to limit their competition.
The beginning of the 'progressive' Regulatory State.

Jun 01, 2015
Another example of fascism in action.



Since fascism, by definition, is unfettered corporatism and regulation REGULATES corporations, this is mostly just an example of the need for people to buy more dictionaries.

Jun 02, 2015
Cap and Trade was the conservative business response to the laws mandating Best Achievable Control Technology and those strictures. It was a way to dodge what they have done to us.

Jun 02, 2015
Only the ignorant AGW Chicken Littles did not see this coming.
Wait till you see the increase in the cost of all goods and services that depend on transportation that use fossil fuels.

Jun 02, 2015
The point is to make the market decide

What market?

Since fascism, by definition, is unfettered corporatism a

No, fascism is state control of corporations. FETTERED corporatism.

"At this point we can say that fascism is (1) a capitalist type of economic organization, (2) in which the government accepts responsibility to make the economic system work at full energy, (3) using the device of state-created purchasing power effected by means of government borrowing and spending, and (4) which organizes the economic life of the people into industrial and professional groups to subject the system to control under the supervision of the state."
https://mises.org...-fascism
"Accepts responsibility" Nice sounding but it's more like seizes responsibility.

Why do the six companies call on the government? Because the govt has the POWER to use force. The six companies have no such power.

Jun 02, 2015
Ryggy, . . . selfishness is not a virtue.

Jun 03, 2015
Another example of fascism in action.

Over 100 years ago the top 5 meat packers asked and supported the creation of the Food and Drug Administration to limit their competition.
The beginning of the 'progressive' Regulatory State.


Let's see. How did that turn out? It seems like it worked out pretty well @R2. Progressives rock man or are you behind the times?

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