Fact Check: G7 Industry Association Letter

The IEA’s 2022 World Energy Outlook states that immediate shortfalls in fossil fuel production from Russia will need to be replaced by production elsewhere – even in a world working towards net zero emissions by 2050, with suitable projects being ones with short lead times and the ability to capture and utilize methane emissions. The IEA then states that long term solutions must focus on reducing demand for fossil fuels, with greater emphasis on action and investments in the clean energy transition.

Role of fossil gas: Energy Transition (Misaligned)

While finding the need to accelerate the phase-out of coal, the IPCC’s April 2022 Report on Mitigation of Climate Change states “purely fossil fuel to fossil fuel switching is a limited and potentially dangerous strategy unless it is used very carefully and a limited way”. Despite the letter acknowledging the need to expand renewable energy, the calls for continued developments in fossil gas and LNG appear contrary to role of gas in IPCC 1.5°C aligned pathways.

InfluenceMap's May 2022 The US Oil/Gas Industry and the War in Ukraine demonstrated the certain actors in the US oil and gas industry spread disinformation on the causes of high gas prices (blaming climate policies), and used this to advocate for the expansion of fossil gas and LNG projects. It is noted that IEA’s World Energy Outlook also talks about the “scant evidence” for the claim that climate policies and net zero commitments were responsible for rising energy prices.

In its latest April 2022 report, the IPCC indicates that to limit global warming to 1.5°C and meet the Paris Agreement objectives, methane emissions would need to be reduced by around 33% by 2030, and 50% by 2050.

InfluenceMap’s ‘LobbyMap’ database shows API, US Chamber of Commerce, and IOGP to be oppositional to the goals on the Paris Agreement in their policy engagement efforts, while Eurogas and International Gas Union are found to have engage climate policies with mixed positions to the goals of the Paris Agreement. ANGEA does not yet have an assessment grade in InfluenceMap’s database due to low engagement levels.

Industry Efforts on Climate: Support for Methane Regulation (Misleading/Inaccurate)

Despite top-line support for methane regulations from the industry associations, InfluenceMap's Methane Platform Policy Tracker identifies negative engagement from several industry association signatories to weaken key methane emissions regulation. This includes positions from Eurogas and the IOGP to weaken the EU Methane Regulation for the energy sector, and positions from the API and US Chamber of Commerce to weaken the US EPA 2022 Methane Regulations.

The IPCC’s August 2022 Report Climate Change 2022: Mitigation of Climate Change discusses the potential for new technologies to decarbonize fossil gas, including the use of alternative energy carriers in net zero energy systems such as hydrogen and bioenergy to substitute out fossil fuels in sectors less amenable to electrification”. However, it draws attention to issues of cost reduction and feasibility of large-scale adoption for such technologies when relied upon for achieving net zero emissions. The IPCC finds that other common characteristics of net zero energy systems include the “widespread electrification of end uses”, including light duty transport, heating, and cooking and “substantially lower use of fossil fuels.”

InfluenceMap December 2022 International Gas Union’s Climate Strategy report detailed how the industry are attempting to lock-in fossil gas through the “greening of gas”, which involves promoting low carbon and decarbonized gases as a means to improve the perception of fossil gas and secure its long-term role in the energy mix. Such that it would be misaligned with the IPCC indicating for a reduction in primary energy supplied from fossil gas and a reduction in fossil fuel demand in 1.5°C-compliant energy pathway.

InfluenceMap’s September 2022 Big Oil's Real Agenda on Climate Change report highlighted this contradiction, when it found that in 2021 despite 60% of public communication instances by Big Oil companies references "green claims", only 12% of the companies’ 2022 capital expenditure was forecasted to be dedicated to "low carbon" activities.

• Ensure that international commitments to expeditiously replace Russian natural gas are matched by clear and consistent supportive policies enabling achievement of this goal, including by:

• Working with industry to encourage public and private investment in all segments of the natural gas supply chain to ensure sufficient development and availability of non Russian supplies, while ensuring consistency with long-term climate objectives.

• Committing to cooperate on ways to improve guidelines and practices associated with public financing of natural gas infrastructure and foster efficient and timely review of permitting of such infrastructure."

In 2021, the IEA report on reaching ‘Net Zero by 2050’ found that there must be no fossil gas fields beyond those already committed to from 2021, stating that global demand for fossil gas would need to fall by ‘more than 5% per year on average’ during the 2030s. It also stressed that a significant number of LNG facilities currently under construction or at a planning stage would not be needed, with LNG trade shown to fall by 60% between 2020 and 2050.

The IPCC’s April 2022 Report on Mitigation of Climate Change highlighted that primary energy supplied from fossil gas will need to fall on average by –20 to –60% to keep global warming within 1.5°C by 2050, noting some pathway variations based on CCS deployment It also detailed that future emissions from existing fossil fuel infrastructure are estimated to exceed remaining cumulative CO2 emissions for a 1.5°C energy pathway. To align emissions with this pathway, the IPCC recognizes the need for cancellation of new fossil fuel projects alongside decommissioning and reduce utilization.