Time To Pay The Piper — The Cost Of Cleaning Up After Fossil Fuel Companies
Marco Grasso and Richard Heede have authored a report published May 19, 2023, by One Earth that quantifies precisely how much each of the 21 top fossil fuel companies in the world should pay to clean up the environmental mess they have made. It’s called “Time To Pay The Piper: Fossil fuel companies’ reparations for climate damages.” It’s a lengthy document and one we encourage everyone to read. We have excerpted portions of it here, beginning with the preamble:
“The calls for climate reparations are rapidly growing in the scientific literature, among climate movements, and in the policy debate. This article proposes morally based reparations for oil, gas, and coal producers, presents a methodological approach for their implementation, and quantifies reparations for the top twenty one fossil fuel companies.”
About The Authors
So, who are these people and why should we care about their research? According to the Climate Social Science Network, Marco Grasso, Ph.D., is professor of Political Geography in the Department of Sociology and Social Research at the University of Milano–Bicocca. His research focuses on the sustainability transitions and on the governance of global commons. Through his work, Grasso aims to develop transformative, fair, and politically innovative responses to address the multiple and compounding risks our societies currently face. He recently published From Big Oil to Big Green: Holding the Oil Industry to Account for the Climate Crisis (MIT Press, 2022).
CSSN says Richard (Rick) Heede leads Climate Accountability Institute’s “Carbon Majors” project that attributes emissions to the corporations that extract and market the lion’s share of carbon fuels worldwide. CAI was founded in 2011 to provide the scientific basis for leveraging climate stewardship by oil, gas, and coal producers. Rick honed his interest in energy and climate policy at Rocky Mountain Institute (1984–2002), his carbon inventory expertise with Climate Mitigation Services (2002–2011), and his advocacy by holding fossil fuel companies accountable. Rick published his thesis A Geography of Carbon (1984) and has pursued effective and ethical action on climate ever since.
Clearly, these authors are not lightweights in the world of climate science.
Holding Fossil Fuel Companies Accountable
Grasso and Heede write, “The climate crisis and its rapidly increasing economic burdens bring to the forefront a question that has been poorly investigated, but bluntly recalled in the 2022 IPCC report on impacts, adaptation, and vulnerability3: who should bear the cost of the harm caused by anthropogenic climate change? Is it states, or affected individuals, families, and businesses? Is it future generations, who had no role in creating the harm? Or should the burden fall on those agents that have contributed the most to global climate disruption, while in the meantime greatly profiting?”
Regular CleanTechnica readers know the answers to those questions. The fossil fuel companies have taken unfair advantage of a distorted and weaponized form of capitalism that exempts them from paying for the environmental damage done by their business activities. Many of those distortions have been created by pliant legislators and administrators who have been bought off by the mountains of cash coming their way from those companies.
In discussions here at CleanTechnica over the years, there is a faction that excuses the fossil fuel companies because, after all, we are the ones pumping gas into our cars and heating our homes with oil or methane. The argument is that the industry is simply filling a need.
There is some truth to that, but here’s the counterargument. For at least 50 years, the fossil fuel companies have known exactly what harm would come from their business activities and have consistently lied to the world. They have conspired to hide their guilty knowledge for no other reason than to protect their profits and the fat salaries lavished on their senior executives.
Their culpability comes not from what they did so much as how they built a wall of disinformation and doubt around their activities, thereby denying the people of the world the ability to make rational, informed decisions about how they use fossil fuels. As Al Capone and Richard Nixon discovered much to their dismay, it’s not the crime, it’s the coverup that gets people in trouble. Now that the coverup has been fully exposed, it’s time to pay up.
$208 Billion A Year
Grasso and Heede put the amount the fossil fuel companies should pay to clean up the environmental harm they have done at $209 billion a year. Before you start feeling bad for the companies, consider this: according to The Guardian, the companies can easily afford to shoulder their share of the burden.
- Saudi Aramco, the state-owned company with the largest emissions, would owe $43 billion annually — equivalent to just over a quarter of its 2022 profits.
- ExxonMobil would owe $18 billion in annual reparations, compared with record profits of $56 billion in 2022.
- British oil giants Shell and BP, which together made $68 billion last year, would be collectively liable for $30.8 billion in annual climate reparations, according to the study.
The creation of an evidence-based “polluter pays” price tag has been welcomed as an important step towards achieving climate justice for communities and countries which have contributed the least but are losing the most as the climate breaks down.
“As increasingly devastating storms, floods and sea level rise bring misery to millions of people every day, questions around reparations have come to the fore,” said Harjeet Singh, head of global political strategy at Climate Action Network International, a group of almost 2,000 civil society groups across 130 countries. “This new report puts the numbers on the table — polluters can no longer hide from their crimes against humanity and nature.”
The study conservatively attributes one third of these future climate costs to the global fossil fuel industry, and one third each to governments and consumers. It considers this to be a substantial yet conservative price tag, as the methodology excludes the economic value of lost lives and livelihoods, species extinction and other biodiversity loss, as well as other well-being components not captured in GDP.
Mohamed Adow, director of Power Shift Africa, a climate and energy think tank based in Kenya, told The Guardian, “The case is clear for oil and gas companies to pay reparations for the harm their fossil fuels have caused. Not only has their dirty energy wrecked the climate, they have [in many cases] spent millions of dollars on lobbying and misinformation to prevent climate action.”
The new study reframes the debate on international climate funding by focusing on the financial responsibility of fossil fuel companies for climate harm, which could help move the debate in the loss and damage negotiations forward, according to Margaretha Wewerinke-Singh, associate professor of sustainability law at the University of Amsterdam.
Marco Grasso said: “The proposed framework for quantifying and attributing reparations to major carbon fuel producers is grounded in moral theory and provides a starting point for discussion of the financial duty owed by the fossil fuel industry to climate victims.”
As climate litigation moves forward in jurisdictions across the world, it is hoped that the evidence-based methodology may also assist courts in attributing blame and calculating damages, according to Erika Lennon, a senior attorney at the Center for International Environmental Law’s energy and climate program.
“It’s a complement to — not a substitute for — climate finance being discussed in policy spaces, but would help fill the massive gap [left] by states in covering the scale and costs of climate harms. This is the next step in holding fossil fuel companies accountable for their trillions of dollars of climate impacts.”
The Guardian reached out to the fossil fuel companies named in the study for comments. A spokesperson for Shell said, “The energy system is the result of society’s choices about everything from transport to land use over many decades. Addressing a challenge as big as climate change requires unprecedented collaboration where everyone has a role to play. For our part, we are reducing our own emissions and working closely with our customers to help them reduce theirs.” Saudi Aramco declined to comment, and the others did not respond.
Of course not. Unless they are finding new and creative ways to bamboozle people into thinking burning fossil fuels is okay, they prefer to keep raking in the cash for as long as they can. If that kills a couple million of their customers, well, that’s just capitalism at work. Nothing to see here, move along. Nothing to see here, move along. Everything will be fine, people. Go back to sleep.
These companies want willing dupes. At CleanTechnica, we would prefer our readers know the truth so they can take appropriate action. According to Dante Alighieri, author of The Inferno, the hottest places in hell are reserved for those who in a period of moral crisis maintain their neutrality. We all have a duty to preserve the Earth so that future generations can thrive on our lovely planet, and we must all play our part, starting today.
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