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Confronting Petro-Power

If runaway climate change is to be avoided, a global pact to leave the bulk of the world's proven fossil fuel reserves in the ground is indispensable. The currently proven reserves of oil, natural gas, and coal contain about 3 trillion tons of CO2. Two-thirds or more of this can never be touched if there is to be any hope of avoiding a destabilized climate. Yet this climate reality runs headlong into a global capitalist economy whose raison d'être is endless growth and that therefore demands an ever-expanding flow of energy. The additional fossil fuel extraction capacity represented in such forms of “extreme energy” as tar sands, Arctic and deepwater deposits, shale oil and gas (unlocked through hydraulic fracturing or “fracking” technology), and mountaintop-removal coal will lock society into an unsustainable energy system for decades to come. The 2012 exploration and development expenditures of 200 fossil fuel companies listed on stock exchanges worldwide are estimated at $674 billion. (This compares with renewable energy investments of $244 billion the same year.) Global exploration and production spending for oil and gas has increased 2.4-fold since 2000, and the IEA projects that by 2035, a cumulative $14.7 trillion may be spent for such purposes, with another $3.1 trillion for refining and distribution—triple the projected spending on renewables.

Fossil fuel companies have every incentive to extract as much as possible of the extremely valuable reserves they have on their books. Leaving the bulk of the world's fossil fuel deposits untouched will require quasi-revolutionary change. Nothing like this has ever been attempted in human history, and it likely will require a combination of regulation, litigation, shareholder activism, and dogged divestment and civil disobedience campaigns. Any such effort runs fundamentally counter to the interests of powerful and politically well-connected companies—not just the fossil fuel producers themselves, but also carbon-intensive sectors such as power utilities, motor vehicle manufacturers, and the petrochemical industry. (To overcome such opposition, there will need to be some sort of compensation or other transition arrangement, although this is too complex an issue to be addressed here.)

A recent analysis by Richard Heede found that just 81 private and stateowned corporations are responsible for about 40 percent of cumulative carbon emissions since the start of the Industrial Revolution, while 9 centrally planned states contributed another 21 percent. (See Table 1–1.) In 2012, just 25 companies were behind 58 percent of worldwide “upstream” oil and gas investments. These include privately owned companies such as Exxon-

Table 1-1. Carbon Emissions by Type of Entity, 1751-2010

* Fossil fuel and cement producers.

Current or former centrally planned states (includes the Soviet Union and post-Soviet Russia as two separate entities).

Source: See endnote 15.

Mobil, Chevron, Royal Dutch Shell, and BP, as well as wholly or partially state-owned firms such as Petrochina, Brazil's Petrobras, Russia's Gazprom, Mexico's Pemex, and Norway's Statoil.

It is no secret that these private firms act solely at the behest of a narrow class of shareholders. The state-owned firms at least nominally serve a broader public interest; in many countries, nationalization was an outcome of historic power struggles over who benefits from the extraction of fossil fuels. Still, state ownership does not necessarily translate into policies in the public interest. State companies may be run in ways that are functionally no different than private companies. Or they may be controlled by unrepresentative regimes that channel revenues into repression or corrupt practices, as Evan Musolino and Katie Auth write in Chapter 17. Fossil fuel revenues can be used responsibly, as Norway has shown. But the full costs of climate change will eventually surpass any benefits that may be derived from continued exploitation of fossil fuels.

It is worth noting that underlying and propping up this web of powerful corporate actors, whose interests so often clash with the public interest, are the wishes, desires, and buying power of hundreds of millions of people. The lure of consumerism (aided by massive advertisement spending) has proven to be almost irresistible around the planet, and many people define themselves more in terms of their material possessions than in terms of being active citizens.

Automobiles are a case in point. They remain one of humanity's key status symbols and are often seen as an embodiment of freedom and individualism. Yet all but a tiny share of the world's motor vehicles run on oil-derived fuels, and total vehicle registrations exceeded 1 billion (for the first time) in 2010. Not only does this vast and growing fleet represent enormous ongoing demand for carbon-based fuels, but it is also a critical factor in locking society onto a dangerous energy path. The vehicle fleet turns over very slowly (every 12–15 years in the United States, and even more slowly during recessions), so that consumer choices and buying behavior embed a great deal of capital in vehicles and the infrastructure that accompanies them, committing society to their long-term use.

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