In March, under pressure from Arjuna Capital and shareholder advocacy group As You Sow, Exxon agreed to publish risks that stricter emissions limits would have on its business.
Exxon’s subsequent report, Energy and Carbon — Managing the Risks, rejected a “low carbon scenario” and said decarbonisation poses no risk to its operations. “Our Outlook for Energy does not envision the ‘low carbon scenario’ advocated by some because the costs and the damaging impact to accessible, reliable and affordable energy resulting from the policy changes such a scenario would produce are beyond those that societies, especially the world’s poorest and most vulnerable, would be willing to bear, in our estimation,” the report concludes.
The Carbon Tracker report notes Exxon’s returns have fallen as it has invested in capital-intensive, low-return projects such as oil sands and arctic drilling. It also says global oil demand will decline over the next 10 to 15 years and says Exxon’s report fails to consider the financial risk that this poses to it and other oil producers.
“Exxon out to consider more seriously the likelihood of a ‘2 decree Celsius climate scenario’ and the implications for its business model,” the Carbon Tracker report says.