American Petroleum Institute (API), the US oil sector’s top lobbying arm, announced Monday it is considering endorsing a price on carbon emissions for the first time. Accordingly, this decision follows the organization’s aim to compromise with the new Biden administration on its more aggressive approach in combating climate change.
In fact, the association announced the virtual CERAWeek by IHS Markit.
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API possibly embracing carbon pricing
This Monday, American Petroleum Institute (API) CEO, Mike Sommers, said the association’s membership is considering endorsing carbon pricing. In fact, this would be the first time the organization makes such a statement in this regard.
Furthermore, Sommers stated this decision would follow a more profound commitment to Biden’s administration’s more aggressive approach in combating climate change.
Therefore, the CEO said that API membership is embracing the US’s return to the Paris climate. Besides, he emphasized that API already supports methane emissions regulation; in fact, an incredibly complicated issue in the Permian Basin and other regions.
In this regard, the association also asks its members to consider supporting a price on carbon dioxide emissions for the first time. Nevertheless, API’s support would be contingent on an “economy-wide” approach. Hence, it wouldn’t be a policy specifically aimed at the energy sector, Sommers added.
S&P today reported that a draft statement by API (not yet approved and first reported by The Wall Street Journal) says it would support federal intervention on “economy-wide carbon pricing.” Furthermore, this would be the result of the primary government climate policy instrument to reduce CO2 emissions.”
Net-zero emissions: “aspirational”?
Moreover, API concluded in a statement this week; “we’ll focus our efforts on supporting a new US contribution to the global Paris agreement.”
Thus far, API and most of the smaller and more mid-sized lobbying firm members resisted any type of carbon tax.
Accordingly, Sommers emphasized at CERAWeek that oil and gas still will represent nearly half of the global energy by 2040. Therefore, so-called “net-zero” emissions pledges are aspirational for now; for instance, because the necessary technologies either do not exist yet or are not cost-effective.
On the other hand, speaking at CERAWeek, John Kerry, Biden’s special presidential envoy, and so-called “czar” for climate, emphasized that the president is not trying to destroy the oil and gas sector.
“I don’t object to fossil fuels,” Kerry said. Thus, “I object to the byproducts, namely carbon dioxide and methane.”
