EXXON BACKS AWAY FROM CARBON TAX CLAIMS

Tamar Hallerman
GHG Monitor
12/14/12

Officials from ExxonMobil Corp. this week clarified that the company conditionally supports a carbon tax only if lawmakers are looking for an approach to price carbon but clarified that the oil and gas giant is not actively lobbying for the cause. In remarks this week, Kenneth Cohen, Exxon’s vice president for Public and Government Affairs, emphasized that the Irving, Texas-based company has not been pushing for the option, especially during the ongoing ‘fiscal cliff’ talks. Exxon’s support of the issue all depends on policy objectives, Cohen clarified. “If it is to raise revenue, [the option is] not on the table. If the policy objective is to put a cost on the use of carbon to discourage its use, then we believe that a revenue-neutral carbon tax should be very much on the table,” he said. Cohen’s remarks come after an Exxon spokeswoman stated last month that a revenue-neutral carbon tax is the company’s preferred method of pricing carbon, as opposed to a cap-and-trade approach being advocated for by some companies such as Royal Dutch Shell.

In recent months, many D.C.-based think tanks have pushed for a carbon tax as a potential revenue source during fiscal cliff talks. However, in recent weeks most policymakers have shied away from the proposal, including the White House and incoming Senate Energy and Natural Resources Committee Chairman Ron Wyden (D-Ore.). In remarks this week on Fox News, House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) clarified that there is little prospect of a carbon tax coming up for a vote in the House in the upcoming Congress. “It’s not going to come from the Republicans,” he said. “We’re going to do our very best to make sure this is not a mole that pops up again.”

Exxon: More Potential from Opening up Public Lands

Cohen said that if lawmakers would like to make money off the oil and gas industry, they should “put our industry to work” instead of levying a blanket tax on emissions. “Put the industry to work and we will generate jobs, we will produce energy and we will produce tremendous amounts of revenue for local, state and federal governments, far more than could be raised by a revenue-neutral carbon tax,” he said, suggesting that the Administration open up more public lands to oil and gas drilling.

Cohen spoke at a briefing at the Center for Strategic and International Studies this week, where Exxon released its most recent energy outlook to 2040. The document estimates that natural gas will likely replace coal by 2025 as the world’s second most widely-used fuel and that coal will likely continue to lose out to gas, nuclear and coal as more countries adopt climate policies and clean energy technologies become more competitive. While the outlook lists CCS technology as something that could significantly help reduce CO2 emissions, it estimates that its influence in mitigating emissions will “likely be limited until improved technologies are developed, and countries adopt appropriate legal and regulatory frameworks to manage its use and potential impacts over time.”