Chevron reveals brand new GHG intensity target bent on achieving net-zero by 2050
U.S. oil major Chevron has adopted a 2050 net-zero aspiration for upstream Scope 1 and 2 emissions and set a new GHG intensity target for Scope 1, 2, and 3 emissions, expected to be reached by 2028.
Direct Scope 1 emissions include the six Kyoto Protocol greenhouse gases (GHG), which are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), sulfur hexafluoride, perfluorocarbons, and hydrofluorocarbons, while Scope 2 are considered to be indirect GHG emissions from imported electricity and steam. Other indirect emissions are included in Scope 3, along with the use of products.
Chevron issued an updated climate change resilience report on Monday, outlining the company’s ambition to advance its lower carbon future by adopting a net-zero aspiration for equity upstream Scope 1 and 2 emissions. This is expected to be achieved by 2050.
Michael Wirth, Chevron’s chairman and CEO explained: “This report offers further insights about our strategy, how we are investing in lower-carbon businesses and why we believe this is an exciting time to be in the energy industry.”
The report, aligned with the Task Force on Climate-Related Disclosures (TCFD), describes how Chevron is incorporating Scope 3 emissions into its greenhouse gas emission targets by establishing a Portfolio Carbon Intensity (PCI) target inclusive of Scope 1 and 2 as well as Scope 3 emissions from the use of its products.
Furthermore, the firm’s new PCI target assists with transparent carbon accounting and company comparison from publicly available data, covering the full value chain, including Scope 3 emissions from the use of products.
Chevron has also set a greater than 5 per cent carbon emissions intensity reduction target from 2016 levels by 2028, aligning it with the company’s flexibility strategy to grow its traditional business, as long as it remains increasingly carbon-efficient by pursuing growth in lower-carbon businesses.
Dr. Ronald Sugar, Chevron’s lead director, commented: “We regularly engage with stakeholders and investors to understand their views and to be responsive to their increasing expectations on all issues, including ESG. Our updated report demonstrates our goal to partner with many stakeholders to work toward a lower-carbon future.”
A PCI methodology document and the online tool will be published to enable third parties to calculate PCI for energy companies. Based on Chevron’s statement, its 2050 equity upstream Scope 1 and 2 net-zero aspiration builds on the company’s disciplined approach to target setting and action, anticipating partnerships with multiple stakeholders and progress in technology, policy, regulations, and offset markets.
In related news, Chevron’s Energy Transition Spotlight presentation last month revealed the firm’s plans and growth targets for renewable fuels, hydrogen, and carbon capture through 2030, and reaffirmed its guidance of $25 billion excess cash generation over the next five years. The company’s plan to invest more than $10 billion between now and 2028 to achieve these growth targets triples its previous guidance of $3 billion.
Anticipating the energy transition demands, the company made leadership changes earlier this year to further empower its lower carbon strategy by naming Jeff Gustavson as the president of New Energies, the company’s new, dedicated organization focused on low carbon.
In September 2021, Chevron also entered into a partnership with midstream player Enterprise Products Partners to study and evaluate opportunities for carbon dioxide capture, utilisation, and storage (CCUS) from their respective business operations in the U.S. Midcontinent and Gulf Coast.