As vital talks approach next month, find out five ways that BP is addressing the challenge of climate change as part of its business
BP is one of many businesses that support action on climate change. It acknowledges that the expected increase of 25% in carbon dioxide (CO₂) emissions from fossil fuels by 2035 is above what experts say is needed to limit the worst impacts, by keeping the long-term average global temperature rise to two degrees Celsius (2°C). This is not what BP wants to see, but what it currently believes is likely. So what is BP doing to help? It is taking action that ranges from contributing to the debate on a global solution to delivering lower-carbon energy to customers.
1. Calling for a carbon price
BP says the scale of the climate challenge is such that governments should act by setting a clear carbon policy framework. In particular, BP says that putting a price on carbon emissions – one that treats all carbon equally, whether it comes out of a smokestack or a car exhaust – will make energy efficiency more attractive and lower-carbon energy sources more competitive. This can be done by emissions trading systems or a carbon tax. BP prepares for the future by applying a carbon price in evaluating large new projects.
BP notes that climate change can be addressed with oil and gas remaining part of the energy mix for several decades. Even under the International Energy Agency’s ambitious ‘450 scenario’ where the temperature rise would be limited to 2°C, oil and gas would still make up 49% of the total energy mix in 2030 and 43% in 2040.
2. Supplying natural gas
Natural gas should play an increasing role in meeting global energy demand because it produces only about half as much CO₂ as coal per unit of power generated. So, increasing the share of gas versus coal helps to restrain greenhouse gas emissions. BP is playing a key role in providing natural gas as a cleaner alternative to coal. Around half of BP’s current Upstream portfolio is in natural gas and it expects that proportion to grow over the next decade. BP is developing important gas supply chains to Europe, including the ‘Southern Gas Corridor’ project to bring gas from the Caspian Sea to European markets. BP is also supplying gas to China and India, two countries that are likely to account for more than half of the growth in global energy demand between 2013 and 2035. Other gas production operations are in Indonesia, Oman and Trinidad & Tobago. BP is also working to reduce emissions from gas production through programmes to prevent methane leaks and to reduce flaring.
3. Providing renewable energy
BP invests in renewable energy where it can build commercially viable businesses. BP is investing at scale in Brazilian biofuels, where it doubled the capacity of its largest sugar cane ethanol facility in 2014. Sugar cane ethanol has life cycle greenhouse gas emissions that are 70% lower than conventional transport fuels. BP also has interests in 16 wind farms, which have a total generating capacity of 2,600 megawatts of electricity.
4. Pursuing energy efficiency
BP requires operations to incorporate energy use in their business plans and assess and implement technologies and systems that could improve energy usage. For example, the new Zhuhai 3 petrochemicals joint venture in China is the first site to use BP’s latest technology for producing PTA, which is used in clothes, paint, plastic bottles and other items. Compared with conventional technology, Zhuhai 3 is highly energy efficient and delivers 65% lower greenhouse gas emissions. BP provides increasingly energy-efficient and high-performance products to customers, including working in partnership with vehicle and equipment manufacturers to achieve more efficient use of fuels and engine oils.
5. Supporting research and partnerships
As well as contributing to the policy debate and investing in lower carbon energy, BP supports research on climate change and takes part in joint initiatives on the issue. One example is the Carbon Mitigation Initiative (CMI) at Princeton University in the US, which describes its mission as being “to lead the way to a compelling and sustainable solution of the carbon and climate change problem.” BP’s Energy Sustainability Challenge (ESC) programme has brought 15 universities together to look at the potential effects of natural resource scarcities on patterns of energy supply and demand. BP also collaborates on specialized models developed with Imperial College London and Princeton to assess possible climate impacts. BP belongs to a number of industry partnerships including the Oil & Gas Climate Initiative, consisting of companies who together produce around 20% of the world’s oil and gas and focused on practical action, sharing best practice and collaboration.
Developing advocacy in 2015
“If governments act to price carbon, this discourages high carbon options and encourages the most efficient ways of reducing emissions widely.”Letter from chief executives of six oil and gas majors
BP has long supported measures to put a price on carbon emissions and continues to raise its advocacy this year. In June, Bob Dudley and five other CEOs of oil and gas companies wrote to the United Nations Framework Convention on Climate Change supporting carbon pricing, saying: “If governments act to price carbon, this discourages high carbon options and encourages the most efficient ways of reducing emissions widely.” Such options include reduced demand for the most carbon intensive fossil fuels, greater energy efficiency, the use of natural gas in place of coal, increased investment in carbon capture and storage, renewable energy, smart buildings and grids, off-grid access to energy, cleaner cars and new mobility business models and behaviours.