Overview of Energy Majors’ Sustainable Ambitions
How energy majors’ targets can impact your operations
Summary - Virtually all energy majors have 2050 as target date for carbon neutrality, focussing mainly on Scope 1 and 2 emissions. Ørsted and Equinor have the most ambitious and stringent targets, followed by Repsol, Eni, Shell, TotalEnergies and BP.
Except for Ørsted, all legacy majors cling to ‘business as usual technologies’. These include synthetic fuels, carbon capture and storage or hydrogen-carriers and derivatives. This diverse technology focus reflects uncertainty about the ‘technology of the future’.
Most energy majors include a carbon tax of approximately $50 - $100 per mT CO2 for their investments, which could include you when working for them. Introduce emission savings in your tender proposal to reflect investment savings to improve your offer. Contact the helpdesk for assistance.
This blog and the tool use publicly available information updated until late 2022.
From laughable idea to reality – carbon neutrality
Two years ago, energy majors were still called oil and gas majors. Evidently a lot has happened since that time, the most important of which is of course the ambitions set by these companies.
Virtually all other energy majors including Shell, BP, TotalEnergies, Eni, Repsol, Aramco, ExxonMobil, Chevron, Petrobras, Petronas, PetroChina, Sinopec and Rosneft, have ambitions to become carbon neutral by 2050.
A remarkable fact in and of itself, it should be noted that most majors are in the process of setting clear intermediate targets and are actually accelerating their ambitions. Targets that were unheard of just two years ago are now common practice, and most energy majors seem to follow – or align themselves closely – with the strict EU target of 55% reduction by 2030, carbon neutrality by 2050.
The acceleration of ambitions by energy majors shows not only how fast times are changing, but also the fact that regulations from energy majors will most likely be increased exponentially in the years ahead.
The percentage indicates the carbon reduction aim for Scope 3. These reductions will impact your operations significantly if you are working for this client.
Current political upheaval make finding correct information and doing predictions on the future challenging.
“ – “ Means no information could be found and thus unknown if this is true.
So what?
One can argue however the extent to which these ambitions will lead to tangible changes for maritime companies and shipowners. On paper and in public, almost everyone agrees that climate change is a threat and that they must play a role in the energy transition. But the urgency with which the companies are planning to transform their businesses could not be more different. Some energy majors have even gone so far as to publicly calling ‘net zero a fad’.
The question is therefore: “to what extent will the energy majors impact your operations in the coming years?”
For most cases, the answer will likely be very little, especially when it comes to shore power requirements. Nevertheless, there are noteworthy differences between the majors that will shape your decision making, in particular the Scandinavian majors who are traditionally most bullish when it comes to sustainability. Contact the helpdesk for more help on tendering for energy majors.
Scope I, II and III emissions
It is important to note that there is a big difference in how exactly ambitions are framed. Commonly heard and often interchanged vocabulary is ‘net zero’, ‘carbon neutral’, ‘carbon intensity’ and many more. The nuances and a lack of standard makes these targets hard to interpret. The most important cross-industry guideline to be used is Scope definition.
Generally speaking, a company’s carbon footprint is defined in three different scopes. To everyone’s surprise, these are called Scope 1, Scope 2 and Scope 3.
Scope 1 emissions are direct greenhouse gas emissions from company operations.
Scope 2 emissions are indirect emissions from energy consumed by the company.
Scope 3 emissions are defined as greenhouse gas emissions that are a consequence of company activities, but occur from sources not owned or controlled by the company. They are also called value chain emissions and can be upstream or downstream of a company’s operations.
The most important for shipowners are Scope III emissions of energy majors, because these are Scope I emissions of shipowners. In the case of energy majors, you - shipowners and service provides - are the energy major’s Scope 3 emissions.
In short, even though most carbon neutral ambitions will impact your project or tender ‘somewhat’, as project and tender managers usually have targets with regards to emission reductions, these will not become stringent until a company has to reduce Scope III emissions officially. Contact the helpdesk for more help on tendering for energy majors.
More stories
