Why ExxonMobil's new CEO, like the old one, backs a carbon tax
ExxonMobil chairman and CEO Darren Woods has signaled his backing for the Paris Agreement and called for a carbon tax to reduce U.S. emissions in one of his first major public communications since taking the reins at the oil giant in January.
In a blog post on the ExxonMobil website, Woods emphasized the importance of managing the risks of climate change and highlighted his company's plans to boost natural gas generation, energy efficiency, biofuels and carbon capture and storage (CCS) to help drive down its emissions.
Increasing populations and growing demand for energy present a dual challenge of meeting people's energy needs while managing the risks of climate change, he explained.
"I believe, and my company believes, that climate risks warrant action and it's going to take all of us — business, governments and consumers — to make meaningful progress," wrote Woods. "At ExxonMobil, we're encouraged that the pledges made at last year's Paris Accord create an effective framework for all countries to address rising emissions; in fact, our company forecasts carbon reductions consistent with the results of the Paris accord commitments."
Woods replaced Rex Tillerson — now U.S. Secretary of State under President Donald Trump — earlier this year at the helm of the fossil fuel giant, which frequently has faced criticism from green groups and is the subject of legal action in the United States over allegations it hid its knowledge of man-made climate change as far back as 40 years ago in order to protect its business.
Climate skeptic Trump has been critical of the Paris Agreement and prior President Barack Obama's Clean Power Plan and has signaled strong support for fossil fuel industries, prompting a group of veteran U.S. Republican politicians to recently tout proposals for an alternative "conservative climate solution" in the form of a new carbon tax.
Woods also offered his and ExxonMobil's backing for such a policy, which could see proceeds from the tax returned to households in the form of a carbon dividend of potentially as much as $2,000 a year for a family of four.
Governments could help advance the search for cleaner energy by enacting "forward-looking policies" and having a uniform price of carbon applied consistently across the economy would be "a sensible approach to emissions reduction," Woods noted in his blog.
"One option being discussed by policymakers is a national revenue-neutral carbon tax," he wrote. "This would promote greater energy efficiency and the use of today's lower-carbon options, avoid further burdening the economy, and also provide incentives for markets to develop additional low-carbon energy solutions for the future."
Elsewhere in the blog post, Woods touted natural gas as having a key role in energy emissions reduction, claiming that natural gas — of which ExxonMobil is the largest U.S. producer — emits 60 percent less carbon dioxide than coal power.
Greater energy efficiency, he said, was also "essential," as well as "breakthrough clean energy technologies" such as CCS and biofuels made from algae.
"All told, we've invested $7 billion to develop lower-emission energy solutions during the past decade and a half," wrote Woods.
This story first appeared on BusinessGreen.