Working towards a lower-carbon future

BP is playing its part by calling for a price on carbon, providing lower-carbon products including natural gas and renewables, pursuing energy efficiency and supporting research

Calling for a price on carbon

BP believes that carbon pricing by governments is the most comprehensive and economically efficient policy to limit greenhouse gas emissions.

Putting a price on carbon - one that treats all carbon equally, whether it comes out of a smokestack or a car exhaust - would make energy efficiency more attractive and lower-carbon energy sources, such as natural gas and renewables, more cost competitive. A carbon price incentivizes both energy producers and consumers to reduce their GHG emissions. Governments can put a price on carbon via a well-constructed carbon tax or cap-and-trade systems.

Our view is that putting a price on carbon will reduce emissions at a larger scale and at lower cost than alternative policy measures, by reducing the demand for carbon-intensive products. It might make our operations and products more costly in some cases. We consider that this is fair - as long as the carbon price impacts all GHG emitters equally - and we are keen to compete on this level playing field.

Supplying natural gas

Natural gas produces about half as much carbon dioxide (CO₂) as coal when burned to generate power.
 
Some argue that gas for power is not that much better than coal for climate, when taking into account its full life cycle greenhouse gas (GHG) emissions. This is because some GHG emissions, particularly methane, occur during the production and supply of both coal and gas. 

Only a small amount of methane is emitted, but it is a powerful GHG that traps more heat than CO₂.
Most government, industry and academic studies that have compared gas and coal for power have found that, over the long term, gas has significantly lower life cycle GHG emissions than coal. Also, based on our own operational experience, we believe methane emissions from gas developments can be economically and technically controlled to increase the climate advantage of gas over coal further.

Around half of our current Upstream portfolio is natural gas and we are increasing that proportion over time. BP is developing major gas supply chains to Europe, including our 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 up to 2035.

Pursuing efficient operations and products

The International Energy Association estimates that energy efficiency will contribute approximately half of the emission reductions required by 2030 to stay below the 2°C threshold.

BP is focusing on ways to improve the energy efficiency of our operations and - even more importantly - the use of our products. Only 10-20% of emissions associated with oil and gas products come from the processes used to make them, with the remainder coming from consumer use in industry, power plants, buildings and transportation.

Read about our Khazzan gas project in Oman, and how we have designed it to be an inherently low-emission concept.

Efficient operations

Reducing the amount of energy BP uses can help to minimize our environmental impacts and provide economic benefits. Our operations typically consider energy use in their business plans and assess, prioritize and implement technologies and systems that could improve energy usage.
Our Zhuhai 3 petrochemicals joint venture in China, for example, is the first site to implement BP’s newest technology for producing purified terephthalic acid, used to make clothes, paint, plastic bottles and other items. 

Compared with conventional technology, Zhuhai 3 delivers around 65% lower GHG emissions.
BP is working to reduce emissions from gas production through programmes to detect and repair methane leaks and to reduce flaring. And, for our oil production activities, new projects must seek alternatives to flaring and venting as a means to dispose of associated gas; this could include capturing the gas for reuse or re-injection in the reservoir.

At our refineries, we use the Solomon Energy Intensity Index® (EII®) to measure the energy performance. This well-established industry benchmark allows us to compare performance of our refineries with each other and with our peers. Each of our refineries set and track progress against an EII® target specific to its circumstances.

Efficient use of our products

We provide increasingly energy-efficient and high-performance products to our customers, meaning if less fuel is used, fewer GHGs are emitted.

Over the past decade we have been developing Castrol lubricants with lower viscosity, which helps manufacturers to improve the fuel efficiency of their vehicles. We estimate that - when compared with our 2004 Castrol formulation - our more recent lubricants have helped avoid more than five million tonnes of CO₂ over the past 10 years. That’s the CO₂ equivalent of removing almost a quarter million European cars from the road each year.

Our premium Ultimate fuels also contribute to better fuel efficiency by restoring the cleanliness of the engine and improving combustion performance. And, we provide customers with information on how to maximize the fuel efficiency of their vehicles, by taking steps such as accelerating and braking moderately and using the correct tyre pressure.

We work in partnership with vehicle and equipment manufacturers to achieve more efficient use of our fuels and engine oils. In Europe for example, Ford’s EcoBoost engines - used in the Fiesta, Focus, Mondeo and other models - are engineered with specially formulated advanced Castrol oils, which help to improve fuel efficiency and reduce emissions.

Investing in renewables

Renewables will play an increasingly important role in achieving a lower-carbon world. They account for around 3% of global energy today, excluding large-scale hydroelectricity, but they are the fastest-growing energy source.

BP invests in renewable energy where we can build commercially viable businesses at scale. Much of our activity is in biofuels in Brazil. We own and operate three sugar cane ethanol mills, farming around 127,000 hectares. We estimate that, as a result of BP’s 2015 ethanol production, approximately 0.7 million tonnes of CO₂ was avoided. That’s equal to 334,000 fewer European cars on the road for a year.
We are among the top wind energy producers in the US, with interests in 16 wind farms across the country. Our share accounts for a combined wind energy capacity of 1,556  megawatts of electricity - that is enough to power all the homes in a city the size of Dallas. And, we calculate that our wind activities helped avoid around 2.7 million tonnes of CO₂ in 2015.

Additionally, Air BP is the world’s first supplier of commercial jet biofuel, supplying Lufthansa, SAS and KLM using the existing fuelling infrastructure at Norway’s Oslo airport.

Supporting research

Technological innovation underpins our efforts for more efficient production and use of fossil fuels, as well as for longer-term alternatives to fossil fuels. 

We deepen our understanding of future energy, technology and climate change trends through in-house research and in partnership with leading academics.

We have been supporting Princeton University’s Carbon Mitigation Initiative since its inception in 2000. It brings together scientists, engineers and policy experts to design carbon mitigation strategies that are safe and effective as well as affordable.
BP’s Energy Sustainability Challenge programme, based on the research of 15 university partners from around the world, looks at the potential effects of natural resource scarcities on energy supply and demand. For example, climate change may increase water scarcity, so the programme looks at how energy can be supplied, taking into account competing pressures for the use of water.

Additionally, we have been investing in start-up companies to better understand evolving alternative and advanced technologies such as electric vehicles, batteries and bio-lubricants. One of these companies - Solidia - has developed a technology to make the production of concrete less carbon intensive. Cement is produced in a way that generates less CO₂ and is then cured or hardened by the addition of CO₂. This approach can result in up to a 70% reduction in the concrete’s carbon footprint and is being rolled out through a partnership with LaFarge across the US and Europe.

Carbon capture and storage

Implementation of carbon capture and storage (CCS) technology could enable continued large-scale use of fossil fuels in a tightly carbon-limited world. But it faces many barriers: high costs, commercial complexity, and an uncertain business and policy environment.

BP has built capability in CCS technology through projects such as the In Salah CO₂ storage project in Algeria and through developing hydrogen-fired power projects in Abu Dhabi and California. Additionally the CO₂ Capture Project, a BP-operated joint partnership, is developing and piloting technology and demonstrating safe and secure geological containment. This initiative was recognized in 2015 for its work in improving the understanding of the CCS life cycle.
 
We share our experience with and support for CCS through various other industry initiatives.

Attestation

The information on this page forms part of the information reviewed and reported on by Ernst & Young as part of BP's 2015 sustainability reporting. View the full assurance statement.

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