Understanding The True Cost Of Net Zero Emissions

The journey to net-zero emissions will have a cost for everyone, and policymakers should clearly explain this to consumers, Total’s chairman and CEO Patrick Pouyanné told CNBC’s Steve Sedgwick at the Baker Hughes 2021 annual meeting this week.

“What I am expecting from the government is not only to set the policies but also for them to take the responsibility and to explain to the citizens and the consumers that this journey will have a cost for everybody,” Pouyanné said at a panel during the meeting.  

The energy transition will need governments and other policymakers to set some policies in order to go carbon neutral, the chief executive of the French supermajor said.

Policymakers shouldn’t forget about the affordability of this energy transition, as reaching net-zero is not black and white, Pouyanné said.

The group he leads, Total, has pledged to reach net-zero emissions across the company’s worldwide operations by 2050 or sooner, and net-zero emissions across all its production and energy products used by its customers in Europe by 2050 or sooner, which includes Scope 3 emissions.  

The European Union’s (EU) carbon neutrality target for 2050 is a very ambitious goal and “obviously will have an impact on the cost of energy in Europe,” Pouyanné said during the Baker Hughes 2021 annual meeting.

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Governments, therefore, need to clearly explain to consumers what would be the cost of the energy transition, according to Total’s CEO.

Total has acquired the largest renewable energy portfolio among European oil supermajors since Big Oil started announcing last year net-zero targets and pledging significantly increased investments in renewables, Bloomberg data showed last month.

Separately, the French oil and gas supermajor said in January that it would not renew its membership in the American Petroleum Institute (API) for 2021 due to divergences with the main U.S. oil lobby over climate policies.

By Michael Kern for Oilprice.com

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