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WASHINGTON – The oil industry’s leading lobby group is preparing to endorse carbon emissions, which would be the strongest sign that oil and gas producers are willing to accept the government’s efforts to confront climate change.
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The American Petroleum Institute, one of the most powerful trade associations in Washington, intends to set a price on carbon emissions as a policy that would lead to the most economical ways to achieve the ambitions of the Paris Agreement, according to a draft statement reviewed by The Wall Street Journal.
‘API supports economy-wide carbon pricing as the primary climate policy tool of the government to reduce CO2 emissions while helping to keep energy affordable, rather than mandated or prescriptive action,’ the draft statement reads.
The API executive committee would discuss the proposed statement this week. In a statement to the Journal, API’s senior vice president of communications, Megan Bloomgren, said the group’s efforts were “focused on supporting a new US contribution to the global Paris agreement.”
The price of carbon aims to discourage the production of harmful greenhouse gases by setting a price on emissions. The API draft statement will endorse the draft in principle, without supporting a specific pricing scheme such as carbon tax.
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The ratification of carbon prices by the major trading group of the oil industry will underline the changing policy of climate change, as large business groups recognize the dangers of greenhouse gases and adapt to a new reality in Washington. Another important business group, the Business Roundtable, cost the price of carbon last year.
President Biden has campaigned for climate change treatment as a crisis, and since he was also in power with the Democrats who control Congress, several major trading groups have announced support for new climate initiatives.
API was just over a decade ago one of the fiercest opponents when Congress last considered important legislation on the issue, a plan to get issuers to pay and trade for their contributions to climate change. This is now just the latest of several that support similar plans to put a price on or tax exemption, following a U.S. Chamber of Commerce announcement in January.
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The institute’s draft statement does not stop explicitly endorsing a tax on carbon dioxide emissions or other specific pricing frameworks, nor does it stop the language of environmental activists who claim that the world should completely switch from fossil fuel power sources.
But it continues with a turnaround that has accelerated since Mr. Biden’s victory. Over the past few weeks, API has returned to opposing the federal direct direct regulation of the oil and gas industry. And it emphasizes that the industry can play a role in helping the world address climate change. This includes laying the groundwork in public to support the price of carbon emissions.
In its January January State of American Energy report, it called for “market-based government policies” to reduce emissions across the economy as a policy that will support progress. According to the Washington Examiner, this was the first time this report contained such language.
“The risks of climate change are real,” API’s annual report said. ” Market-based policies can promote significant reductions in emissions across the economy at the lowest cost to society. An example of this could be the price of carbon – reducing GHGs with flexibility and pace to keep energy affordable. “
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Internally, many API members are strongly opposed to endorsing a carbon tax or setting standards for the use of renewable energy, according to one person familiar with the internal discussions who described it as ‘heated’. The organization has had similar internal conflict over its stance on methane emission regulations, which the Trump administration overturned at the request of independent producers.
These battles over climate change have increased the pressure on API from within. While many of the smaller and American businesses in its membership want them to push for traditional values - lower government regulation and more access to federal states – some of the majors, especially those in Europe, have pushed the organization to adopt an ongoing transition to cleaner fuel, which is often fueled by government intervention.
Just two days after the annual report was released, Total SA announced that they were leaving the organization, saying API was not fully involved in climate change. The French oil giant insisted on changing its business to produce and sell renewable energy, and in its decision pointed directly to the API’s previous opposition to carbon prices and US regulations on methane emissions.
“The (enterprise) recognizes the API’s significant contribution to the development of our industry for over a century,” said CEO Patrick Pouyanné in a statement at the time. ‘Nevertheless, as part of our Climate ambition … we are committed to ensuring in a transparent manner that the industry associations of which we are members take positions and messages that correspond to those of the (company) in the fight against climate change. alter. ”