Exxon Says it Never Doubted Climate Change Threat
Author: Gerard Wynn
Exxon had simply firmed up, or "evolved", its understanding of the threat, said Cohen, the company's head of public affairs.
The world's most profitable company now accepted that a US climate policy was inevitable and it preferred either a carbon market that would allocate carbon credits solely to suppliers of fossil fuels, such as oil companies, or else a carbon tax, Cohen added.
Under an existing European scheme, carbon credits have been given to utilities and will earn these companies tens of billions of euros in windfall profits.
The commonest greenhouse gas, carbon dioxide, is made by burning fossil fuels like oil. Environmental groups have long accused Exxon of funding research groups that rubbished the threat of a manmade, climate change catastrophe.
"We're very much not a denier, very much at the table with our sleeves rolled up," Cohen told reporters.
Cohen also chairs the Exxon Mobil Foundation which last year, alongside Exxon, handed out US$139 million to charities and research groups.
In 2005 the company withdrew support for the Competitive Enterprise Institute, which the following year ran an advertising campaign promoting carbon dioxide, which said "we call it life".
It still funds groups such as the Heartland Institute, which describes global warming as "a prime example of the alarmism that characterises much of the environmental movement".
But Cohen said Exxon had only ever funded such groups because they were against the Kyoto Protocol on global warming, negotiated in the late 1990s, and which Exxon still rejects -- and not because they cast doubt on climate change.
"We started funding a number of these groups because we were opposed to the Kyoto Protocol. We were slow to stop funding."
Exxon could terminate its support of more groups, Cohen added -- "It's a question we're asking ourselves," he said.
Exxon now sees as inevitable a federal US law to penalise greenhouse gas emissions, for example through a carbon tax or trading scheme.
It prefers what Cohen called an "upstream cap and trade" carbon market, capping emissions at the level of fossil fuel suppliers, rather than energy consumers like utilities, arguing that this would distribute carbon costs more evenly through an economy.
"We lean move towards an upstream cap and trade with a price protector, or a carbon tax."
Carbon markets cap emissions by distributing a fixed quota of carbon emissions permits.
The two-year-old European Union carbon trading scheme takes a "downstream" approach, and power utilities which got most carbon emissions permits for free have passed on the carbon price to electricity consumers regardless, in a practice which is expected to earn them tens of billions of euros in profits.
If permits were auctioned rather than given away for free, or if companies were unable to pass on the carbon price, a scheme could cost companies money.
"It will not be a profit-maker if the rights are sold. The devil's in the detail," said Cohen.