Until the sector radically transforms, commitments and targets from fossil fuel companies will no longer be accepted by the Science Based Target Initiative, an organization that helps companies align their environmental sustainability actions with climate change goals.
The extraction and use of oil, gas and coal account for 89% of global carbon dioxide emissions, according to the Intergovernmental Panel on Climate Change, the United Nations body that assess climate science.
Previously, the SBTI would accept such pledges and targets, but now companies will no longer be able to join the initiative if they have “any level of direct involvement in exploration, extraction, mining and/or production of oil, natural gas, coal or other fossil fuels, irrespective of percentage revenue generated by these activities.”
“This a sign SBTi knows fossil fuel companies don’t have a prayer of achieving science-based targets with their business-as-usual approach. With its announcement, SBTi acknowledges that fossil fuel companies have no path for achieving science-based targets,” said Green Century Capital Management President Leslie Samuelrich said to Investment News.
SBTI said it would still accept commitments from companies that derive less than half their sales from the sale, transmission and distribution of fossil fuels, less than 5% of revenue from fossil fuel assets for extraction activities with commercial purposes and electricity utilities that mine coal for power generation.
This includes oil and gas exploration and production, refining and marketing companies, as well as distributors of oil and gas products, among others. Whether or not this will affect base oil and lubricants companies is unclear, but according to a SBTI consultation document from 2020, exemptions are made for lubricants since they are not combusted, with the exception of two stroke oils.
However, elsewhere SBTI states that companies “including, but not limited to, integrated oil and gas companies, integrated gas companies, exploration and production pure players, refining and marketing pure players, oil products distributors, gas distributors and retailers and traditional oil and gas service companies.”
In a statement announcing the decision, SBTI said “companies may be reinstated following further development of the fossil fuel sector project.” In the meantime, SBTI will convene a panel of independent experts to review the oil and gas methods and guidance.
(SBTI did not respond to Sustainability InSite’s request for more information on whether this new policy applies to lubricant companies.)
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