Oil companies are more concerned with their public images than ever before, especially pertaining to the environmental impact of their operations. Under pressure from the U.S. Department of Energy, the Office of Fossil Energy, consumers, activists, and shareholders, many oil companies have invested in renewable energies or altered their procedures to "stay green."
The oil companies that have done the most to protect the environment include Royal Dutch Shell PLC, TotalEnergies S.A., Repsol, and Equinor. All four of these companies were listed in a Morningstar 2020 report on emission challenges.
- Oil and energy companies are worried about public perception and opinion as the world grapples with climate change.
- Green energy comes in many forms like solar or wind farming.
- Many companies are moving towards renewable energy sources.
- Wind and solar farming is being done by oil companies around the world.
- A 2020 Morningstar report cited Total, Shell, Equinor, and Repsol as leaders in protecting the environment through research, development, and the creation of green energy.
1. Royal Dutch Shell PLC
Shell has aimed to spend $2–$3 billion a year on its Renewables and New Energy Solutions (formerly New Energies) division that it started in 2016.
Shell is looking for ways to create energy by decarbonizing and focusing on electricity. In 2019, Shell started offering all of its British residential customers 100% renewable electricity. This means that for every unit of electricity used, another unit is placed back into the grid by renewable generators.
In 2018, Shell invested in the U.S. firm Inspire Energy, which provides clean energy plans in certain states. It also purchased Greenlots, which is a startup focused on charging solutions for electric vehicles. In 2019, Shell purchased German firm Sonnen, a large home battery manufacturer and the creator of an electric vehicle charging system. Sonnen is also one of Tesla's (TSLA) biggest rivals.
Other than clean electricity, Shell has made significant investments in the solar energy sphere. It purchased stakes in Sunseap Group, a Singapore-based solar company; Silicon Ranch, a U.S. solar firm; and has Greenfield solar and storage in development.
2. TotalEnergies S.A.
TotalEnergies, based in France, is one of the largest oil and energy companies in the world. TotalEnergies provides access to renewable energy in the form of wind, solar, biomass, and hydropower. Total Qaudran is a subsidiary of TotalEnergies and is at the forefront of developing and operating (and building) renewable energy products in France and worldwide.
As of 2021, Total Quadran operates over 340 renewable energy plants (including 224 solar plants) in France that total nearly 1,000 MW, generating 1,765 GWh of renewable electricity per year, according to its website. This is the equivalent of the annual consumption of nearly 1 million people and annual savings of nearly 130,000 tons of CO2 emissions. Total is aiming to expand its reach to reach 100 GW of gross production capacity from renewable sources by 2030.
3. Repsol S.A.
Repsol S.A. is an energy and petrochemical company based in Madrid. This Spanish company, a leading producer and main consumer of hydrogen, has 24 million customers worldwide and boasts of a corporate strategy of "ensuring sustainability and moving towards a low-emissions future and the decarbonization of the economy." So far, this company appears to be working towards a greener future.
Repsol is exploring how to utilize climate-friendly and green methods to override how it produces and uses hydrogen and produces synthetic fossils fuels. In March 2021, the company bid on "pandemic recovery funds to support projects including new biofuel plants and 'green' hydrogen production made from renewable sources in a pivot away from oil and gas to supplying low-carbon energy," according to reporting from Reuters.
Equinor is a broad energy company specializing in developing solar, gas, wind, and oil energy while seeking low-carbon solutions, like wind and solar farming. Headquartered in Stavanger, Norway, the company is present in 30 countries and was founded in 1972.
The company services over 170 million customers who benefit from its oil, gas, and wind power. As of 2020, the company began construction at Hywind Tampen, the world's largest floating offshore wind farm (88 MW). This build aims to scale up floating offshore wind and provide power to five platforms, according to its 2020 sustainability report.
Equinor's goal is to cut emissions in Norway towards near zero in 2050 and reduce its net carbon intensity by 50% by 2050.
The Bottom Line
Major oil producers can't rest on these advancements, even if only for green marketing or public relations reasons. Though oil and energy companies are taking steps to produce more clean energy and protect the environments that they operate in, the bulk of their business is still from the production of gas and oil, damaging the environment. These leading oil companies are focusing on clean energy plans and taking the lead in slowing climate change.