Home Investing News U.S. climate czar urges oil industry to hasten transition to renewables

U.S. climate czar urges oil industry to hasten transition to renewables

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imageCommodities53 minutes ago (Mar 02, 2021 01:01PM ET)

(C) Reuters. FILE PHOTO: U.S. President-elect Joe Biden announces announces national security team at his transition headquarters in Wilmington, Delaware

By Valerie Volcovici

WASHINGTON (Reuters) – U.S. climate envoy John Kerry on Tuesday urged oil and gas companies to do more to diversify and adopt low-carbon technologies to tackle climate change.

Speaking alongside oil executives making the case for the continued production of oil and gas at the virtually-held CERAWeek conference, Kerry called for the United States to accelerate the development of hydrogen, carbon capture and other technologies that can reduce emissions.

“I think that the fossil fuel industry clearly could do a lot more to transition into being a full-fledged energy (industry) that is embracing some of these new technologies,” Kerry said in a conversation with former U.S. Energy Secretary Ernest Moniz.

The coronavirus pandemic has accelerated the transition to renewable fuels and electrification of key elements of energy use. Global majors have been playing catch-up, responding to demands from investors to reduce production of fuels that contribute to global warming.

The United States will disclose a new greenhouse gas emission reduction target for the next decade at a global leaders summit on April 22, he said. President Joe Biden, who appointed Kerry, announced on this first day in office in January that America will rejoin the Paris climate agreement.

Biden, in his first weeks as president, canceled a presidential permit that would have allowed the construction of the Keystone XL crude oil pipeline from Canada, and is taking steps to limit new oil and gas development that could limit new leases on federal lands.

His actions have drawn criticism from oil executives who believe this will make the United States more dependent on oil imports from countries other than neighboring Canada or Mexico.

“We’ve reached energy independence from just looking at North America – Canada, the United States and Mexico – and now we’re going to be importing 60% to 70% of our crude from OPEC again if they follow through with our ban and not allow any more production,” said Scott Sheffield, chief executive officer at Pioneer Natural Resources (NYSE:PXD) Co.

Chevron Corp (NYSE:CVX) CEO Michael Wirth said in a separate session that the oil industry and U.S. government can join to advance lower-carbon fuels.

Natural gas should play a very important role,” added Wirth. “This is an area where there should be common ground.”

In his remarks, Kerry also highlighted the need for a major investment in energy infrastructure in the United States to accelerate the deployment of renewable electricity and called out states like Texas, for being resistant to modernizing the U.S. electric grid.

“We need to have a smart grid. That will save us huge amount of money, reduce emissions and produce a capacity to have baseload challenges met,” Kerry said, adding the U.S. could drastically increase renewable electricity deployment.

“But we are going to have to get rid of some of our chauvinism and our parochial components that resist common sense and the need to move very hastily to get this done,” he added.

U.S. climate czar urges oil industry to hasten transition to renewables

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