The U.S.’s preeminent trade and lobbying group, the American Petroleum Institute (API) announced today the launch of a new policy framework, aimed at confronting the challenges of climate change while addressing growing global energy needs. Among the new policies is an endorsement by the API of carbon pricing, marking a major position shift for the organization.
In its new Climate Action Framework, the API said:
“API and its members commit to delivering solutions that reduce the risks of climate change while meeting society’s growing energy needs. We support global action that drives greenhouse gas emissions reductions and economic development.”
The API’s policy shift comes as the lobbying group is facing increasing pressure both from a more environmentally conscious US presidential administration and from major industry participants looking to address their own climate impact. In January, President Biden announced a pause on new oil and gas leases on public lands and offshore, as part of a series of climate-focused executive actions.
Earlier this year, energy major Total announced that it will not renew its membership in the API, after completing a detailed analysis of the API’s climate positions. One of the key areas of misalignment cited by Total was the API’s opposition to carbon pricing.
The new framework lays out actions by government and the energy industry, along with policies that the API recommends in order to ensure energy delivery and emissions reductions, focused on five key areas. These include accelerating technology and innovation, including carbon capture, utilization and storage (CCUS) and hydrogen technology and infrastructure; mitigating emissions from operations through methane regulations, refinery carbon reduction programs, and flaring reduction; endorsing a market-based carbon pricing policy; advancing cleaner fuels, including natural gas, as well as developments in lower carbon electricity and lowering transportation emissions, and; climate reporting, including increased ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. More reporting guidance for the natural gas and oil industry, and the development of GHG emissions indicators and methodologies.
API President and CEO Mike Sommers said:
“Confronting the challenge of climate change and building a lower-carbon future will require a combination of government policies, industry initiatives and continuous innovation. America has made significant progress in reducing emissions to generational lows, but there’s more work to do, and there’s nobody better equipped to drive further progress than the people who solve some of the world’s toughest energy problems every day.”
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