With all the things going wrong with the Net Zero plan, you might think its advocates would be going back to the drawing board. But if so, it’s in a lawyer’s office, as the mounting costs and frustrations associated with ditching fossil fuels start to turn the public sour and litigation starts looking better than legislation. Especially after a Dutch court just ordered Royal Dutch Shell to “cut its own CO2 emissions and those of its suppliers and customers by 45 percent by the end of 2030 from 2019 levels”, as Politico chuckled. Or rather crowed, in a story headlined “'Powerful signal': In a single day, Big Oil suffers historic blows on climate/ Courts, customers and Wall Street delivered rebukes to Exxon Mobil, Chevron and Shell.” None of which makes alternative energy work any better, or fossil fuels any less essential. It just makes them less available. Unless, of course, the customers just start buying them from other sources. Even judges need to fill up their cars once in a while.
Need we point out that it’s not easy for a company to wave a magic wand or gavel and have customers emit 45% less CO2 in nine years? After all, the customers can simply shop elsewhere, a problem courts don’t have and may not understand.
This point may also have eluded the rebel shareholders backed by the world’s largest investment firm, BlackRock, which is firmly against fossil fuels except in its massive Chinese holdings, who managed to insert two anti-oil nominees on the board of Exxon Mobile. As a private firm, Exxon Mobile can try to sell anything it likes to anyone willing to pay its price (unless the government says the stuff is dangerous, correctly or not). But customers might decide that they want to get gas from a gas company that has gas. A potential problem also for Chevron, whose shareholders also voted to cut their own purses.
Does any of the real-world stuff matter? Not according to Politico’s experts who say: “The rebukes signal that climate concerns, once confined to environmental activists and barely registering with some Washington lawmakers, have become mainstream thinking in C-suites and on Wall Street, analysts said. The visible effects of climate change, action by governments, and shifting consumer sentiment are transforming the world in which companies do business.” But again, it’s true in a PR and legal sense. It’s not true of the laws of physics, a “real world” issue of which such people lose sight if indeed they ever had it.
And the CEO of As you Sow, a “shareholder advocacy group”, whatever that is, said “A powerful signal has been sent to every oil company, to every company that’s polluting, to every company that’s in the economy. These boards can’t continue ignoring their shareholders.” True. But the shareholders can’t ignore the customers either. Just saying.
In Australia a court not composed of climate scientists sided with some children who are also not climate scientists and an 86-year-old nun who isn’t either but think oil is yucky, though only part-way. The court declared that the Australian environment minister does have a duty of care to protect young people from bad weather in the future, but not that allowing a coal mine to expand would necessarily violate that duty. The mine declared victory but we suspect the celebrating environmentalists are right that the precedent is what matters. And we would uneasily agree.
We would also note that Shell’s effort to rally round the white flag to forestall this danger failed as usual. As Politico observed “Shell last month said it would cut the carbon intensity of its products by 20 percent by 2030 and go net zero on emissions by 2050, efforts that its shareholders backed last week. The company is also investing billions of dollars in electric vehicles, hydrogen, renewables and biofuels. But the Dutch court said Shell’s initiatives weren’t concrete and relied too heavily on ‘monitoring social developments rather than the company’s own responsibility for achieving a CO2 reduction.’”
It isn’t just proponents of alternative energy who struggle with unpleasant truths, it would seem.