International oil companies and the energy transition

Asmelash, Elisa
Gorini, Ricardo

2021

333.823.2/AS836

978-92-9260-325-0

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Oil companies and historical engagement in renewable energy. International oil companies. Preliminary findings. What are the companies announced future commitments? International oil companies long-term climate targets. Additional findings. Oil companies financial strategies and implications for the energy transition. The way companies see the future - the role of scenario analysis. IRENA's transforming energy scenario. Scenarios comparison: IRENA and international oil companies. Conclusions.

Renewable energy technologies have experienced a breakthrough in recent years, and their deployment has continued to rise despite the uncertainties of the COVID-19 crisis. Similarly, the surge in climate-friendly commitments and the pressure to accelerate the energy transition from investors, consumers and governments have intensified since the outbreak of the pandemic.These circumstances, together with the economic downturn associated with the pandemic (i.e., very low and negative oil prices) have presented significant challenges and threats to the activities of international oil companies. As such, these companies are progressively repositioning themselves in the energy industry, with investments, and commitments on further investments, in renewable energy solutions, energy efficiency, and other clean technologies as well as defining new or more ambitious emission reduction targets. However, this raises the question to what degree these climate commitments and investments in clean technologies indicate that international oil companies are transforming into energy companies to reduce greenhouse gas emissions, at the speed required to limit global warming. This report addresses this question, by analysing and presenting oil companies’ clean energy strategies and investments, as well as climate targets. Results show that, despite the recent announcements of emission reduction targets and engagement in renewable energy projects, the companies’ actual investments in renewables are still low compared to those in fossil fuels.

Series Staff technical paper, 1/2021

Industria del Petróleo; Energía Limpia - Inversiones; Gases de Efecto Invernadero; Transición Energética;