Tag: BP and Shell

Sorry, Rigzone and Telegraph, Oil and Gas Companies Are Wise to Reject Net Zero and Renewables

Rigzone and The Telegraph, among other outlets, are reporting that many major energy companies are tempering net-zero pledges they made in recent years, turning away from renewables and back towards oil and gas. This move makes sense, as subsidies that wind and solar depend on may dry up, and traditional sources outcompete them.

From ClimateRealism

By Linnea Lueken

Rigzone and The Telegraph, among other outlets, are reporting that many major energy companies are tempering net-zero pledges they made in recent years, turning away from renewables and back towards oil and gas. This move makes sense, as subsidies that wind and solar depend on may dry up, and traditional sources outcompete them.

The Rigzone post, “Leading Energy Companies Holding Back Renewables Commitments, BMI Says,” reports that the Fitch Group, a financial information company, says that companies like BP, Shell, and others, are “holding back renewables commitments to secure higher short-term return.”

Most notably, Fitch told the outlet that Equinor “halved its low carbon investment from $10 billion to $5 billion,” BP “abandoned its 2030 oil output reduction target and is divesting its U.S. onshore wind business,” and even Shell “weakened its carbon reduction targets and is investing in Bonga North deep-water oil and gas project in Nigeria.”

The reason? Rigzone reports that high costs for renewables projects, supply chain disruptions, and the need for energy security all factored in, according to the Fitch analysts.

Reporting from the Telegraph in “We were wrong on net zero, BP boss admits,” suggests that pressure from a hedge fund Elliott Management incentivized BP to abandon their focus on net-zero, because “the company’s shares are underperforming partly because it has wasted too much money on renewables.”

All of this is unsurprising, especially given that many subsidies for wind and solar may soon dry up with the new Trump administration, these companies may be seeing the writing on the wall.

Wind companies in particular have struggled even with large government subsidies backing renewable investment. For example, Dominion Energy’s Coastal Virginia Offshore Wind project cost $2 billion more than promised when the development first was proposed by 2021, and today only half completed has again re-evaluated the costs up another billion dollars. These costs are being passed onto consumers.

Approximately 46 percent of all federal government subsidies went to wind and solar between 2016 and 2022. President Trump has already paused offshore wind lease sales and paused approvals for onshore wind. Likewise, the new EPA Administrator Lee Zeldin is working to “claw back” billions from the Greenhouse Gas Reduction Fund, which threw money at various renewables projects and green organizations.

Oil companies certainly received money from these subsidies and funds for their renewable’s projects and pledges, and if that cash flow ends, it would be difficult for them to maintain the grift.

Both Rigzone and The Telegraph imply that these divestments from renewables are a bad thing, however, The Telegraph notes the forced “rapid energy transition” is far has been causing more harm than benefits and threatens energy security and reliability.

As Climate Realism has covered for foreign countries, the United States, and all the way down to individual states, energy security is at risk when the so-called “energy transition” is pursued. The premature closure of reliable energy sources like coal, nuclear, and natural gas, have had grid operators and even individuals from federal commissions sounding the alarm; renewables just cannot fill the gap. Add to that the fact that there is no transition occurring at a global scale: electricity production data show that while wind, biofuels, and solar are being added to the overall mix, traditional sources of energy are still growing as energy consumption in general increases. (See figure below)

Despite Rigzone’s and The Telegraph’s apparent dismay that major oil companies are back-tracking on their net-zero goals and investments in renewables, for consumers and energy security the move is a boon. Reliable, affordable energy benefits people and nations. While reports of these companies’ actions are upsetting climate activists, hopefully it will signal to other firms and industries that it is safe to divest from climate alarm.

Federal Reserve Withdraws from Global Climate Coalition

n recent weeks, the climate policy landscape has shifted significantly, with institutions, governments, and corporations beginning to step back from the ambitious but economically questionable climate commitments they made over the last decade. Two major developments underscore this retreat: the U.S. Federal Reserve’s exit from the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) and BlackRock’s withdrawal from the Net Zero Asset Managers initiative (NZAM) and it’s subsequent suspension of activities. These high-profile decisions, along with similar moves globally, suggest growing recognition of the economic damage wrought by costly, ineffective, and overreaching climate policies.

From Watts Up With That?

By Charles Rotter

In recent weeks, the climate policy landscape has shifted significantly, with institutions, governments, and corporations beginning to step back from the ambitious but economically questionable climate commitments they made over the last decade. Two major developments underscore this retreat: the U.S. Federal Reserve’s exit from the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) and BlackRock’s withdrawal from the Net Zero Asset Managers initiative (NZAM) and it’s subsequent suspension of activities. These high-profile decisions, along with similar moves globally, suggest growing recognition of the economic damage wrought by costly, ineffective, and overreaching climate policies.

The Federal Reserve: Not a Climate Policeman

In a move that has sent shockwaves through climate advocacy circles, the U.S. Federal Reserve announced its withdrawal from the NGFS—a coalition of central banks established in 2017 to address climate-related risks in financial systems. Citing its limited statutory mandate, the Fed made clear that it was not responsible for shaping climate policy. Chair Jerome Powell has repeatedly emphasized this point, stating that climate matters belong to Congress, not the central bank​.

The NGFS, claimed lofty goals of integrating climate risks into monetary policy, and has grown increasingly politicized. Its shift toward broader mandates—essentially promoting green agendas over sound economic principles—clashes with the Fed’s responsibility to maintain monetary stability. The exit comes amidst broader U.S. skepticism of climate-focused regulations, particularly in the financial sector, where their potential to disrupt industries and inflate costs is well-documented.

BlackRock, the Financial Behemoth, Exits the Climate Stage

Adding to the wave of institutional departures, BlackRock, the world’s largest asset manager, recently withdrew from the NZAM, which then collapsed. This coalition aimed to align financial investments with the nebulous goal of achieving net-zero carbon emissions. Yet, BlackRock’s exit reflects a broader reality: these climate initiatives are not only politically fraught but also deeply misaligned with financial performance and client interests.

BlackRock faced mounting criticism, especially from Republican-led states in the U.S., for prioritizing environmental, social, and governance (ESG) initiatives over fiduciary responsibilities. Florida, Texas, and other states accused BlackRock of undermining traditional energy industries and pulling resources away from economically viable ventures. Tennessee recently pummelled BlackRock in court. These pressures have created a domino effect, with other institutions also reconsidering their commitments to net-zero coalitions​

Corporations Abandon Ambitious Climate Pledges

The retreat is not limited to financial institutions. In the corporate world, companies like BP and Shell have quietly scaled back their green initiatives, prioritizing short-term profitability over unrealistic carbon reduction goals. BP recently spun off its offshore wind projects, while Shell drastically cut back on renewable investments. Both companies have signaled a return to traditional energy sources as energy security and profitability take precedence over climate narratives, driven by a foundational flaw in climate policy: the failure to acknowledge economic realities. Renewable energy remains heavily reliant on subsidies, while oil and gas—despite decades of demonization—continue to drive global economies. Attempting to prematurely phase out fossil fuels without viable replacements has proven disastrous, with Europe’s energy crisis serving as a glaring example.

The Cost of Climate Ambition: A Reckoning for Governments

The global retreat from climate commitments signals a long-overdue recognition of the real costs of these policies. Nations that enthusiastically embraced net-zero goals are now grappling with rising energy prices, faltering economies, and public discontent. Germany, once hailed as a green energy pioneer, faces skyrocketing electricity costs and industrial flight, as energy-intensive industries relocate to more affordable regions. Similarly, the UK government’s climate policies have drawn ire from both businesses and households burdened by rising living costs.

The U.S. isn’t immune to these effects. A Congressional Budget Office report estimated that clean energy subsidies enacted under the Inflation Reduction Act will cost $825 billion over the next decade—a staggering price tag for policies that are unlikely to achieve meaningful reductions in global temperatures. These costs disproportionately impact working-class households, who bear the brunt of higher energy bills and inflation.

At the heart of this shift is a recognition that climate policies have devolved into a costly exercise in virtue signaling. They demand enormous economic sacrifices with little measurable impact on global temperatures. Worse, these policies often exacerbate existing challenges, such as energy insecurity, supply chain disruptions, and inflation.

Additionally, the politicization of climate science and policy has fueled resistance. Increasingly, institutions and governments are questioning the wisdom of aligning with initiatives that prioritize ideological goals over economic and practical considerations. As the Federal Reserve’s exit from the NGFS demonstrates, organizations tasked with specific mandates cannot afford to be sidetracked by climate-related ambitions outside their purview.

The Way Forward: A Pragmatic Approach to Energy and Policy

The unraveling of these grand climate coalitions provides an opportunity to reassess priorities. The global economy needs energy policies grounded in reality—not utopian ideals. Policymakers should abandon sweeping mandates and instead focus on ensuring energy reliability, affordability, and innovation.

Ultimately, the retreat from climate policies underscores an uncomfortable truth: these initiatives are costly, ineffective, and increasingly unsustainable. The financial and corporate worlds are waking up to this reality, and the broader public is not far behind. As more institutions step away from the climate bandwagon, one hopes this marks the beginning of a more rational, economically sound approach to energy and environmental challenges.