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Sun, September 26, 2021, 2:00 PM·5 min read
Exxon, Chevron Shun Solar And Wind
Across the Atlantic, U.S. supermajors Exxon and Chevron are betting on renewable fuels and CCS, but they are steering clear of investments in solar and wind power generation.
Chevron doesn't have any plans to reduce its oil and gas business to invest in solar or wind power, chief financial officer Pierre Breber said earlier this year.
Shareholder returns are more important for Chevron than investing in wind and solar energy, chief executive Mike Wirth told CNBC in an interview last week.
"These [wind and solar] are technologies that are relatively mature. There is plenty of capital that's available. The returns in wind and solar are actually being bid down, and we've concluded that management in our company can't create value for shareholders by going into wind and solar," Wirth told CNBC.
Chevron Triples Planned Low-Carbon Energy Investment
Days before the interview, Chevron said it would triple its planned capital investment in lower carbon businesses to $10 billion through 2028, including $2 billion to lower the carbon intensity of Chevron's operations.
Chevron's pillars of low carbon energy businesses are growing renewable natural gas production, raising renewable fuels production capacity, boosting hydrogen production, and increasing carbon capture and offsets to 25 million tons per year by developing regional hubs in partnership with others.
"With the anticipated strong cash generation of our base business, we expect to grow our dividend, buy back shares and invest in lower carbon businesses," CEO Wirth said.
ExxonMobil Low Carbon Solutions – Exxon's New Business
Exxon, for its part, created earlier this year a new business, ExxonMobil Low Carbon Solutions, to commercialize its low-carbon technology portfolio, focusing first on CCS.
The new business is advancing plans for more than 20 new CCS opportunities globally to enable large-scale emission reductions. ExxonMobil plans to invest $3 billion on lower-emission energy solutions through 2025.
"We are focused on proprietary projects and commercial partnerships that will have a demonstrably positive impact on our own emissions as well as those from the industrial, power generation and commercial transportation sectors, which together account for 80 percent of global CO2 emissions," Exxon's CEO Darren Woods said in February this year.
Shareholder pressure on Exxon has increased tremendously since then, and so has on Chevron.
The U.S. supermajors have not pledged any net-zero emission targets, but they are likely to accelerate announcements about investments in lower-carbon energy, which, apparently, will not include solar or wind.
By Tsvetana Paraskova of Oilprice.com