The Wonk Room

Exxon Spends More On Its CEO Than It Does On Renewables

Exxon Mobil’s CEO Rex Tillerson made $21.7 million last year — admittedly a small chunk of the company’s $40 billion in profits. The skyrocketing price of oil behind Tellerson’s windfall has a very different impact on most people — everyone from school districts to small businesses are struggling to survive. What makes Tillerson’s good fortune particularly galling is that his company is leading the rush to burn up the planet. At a conference for oil and gas executives in 2007, he claimed that most politicians make bad decisions because they don’t take the long view — unlike companies like Exxon:

Most policymakers operate on two-, four- or six-year timelines, while most energy companies operate on two-, four- or six-decade timelines. This is an important point, because acting impulsively in setting energy policy with the expectation of immediate results will likely have negative consequences that will be felt for decades to come.

The truth is Exxon’s policy is based entirely on short-term gains with disastrous long-term consequences. At the recent Congressional hearing with top oil executives, Exxon’s Stephen Simon said his company agrees with the U.S. Energy Information Administration projection that the world will continue to be powered 80 percent by fossil fuels and that “the impact of renewables” will be “very, very small” for decades to come.

Tillerson is trying to make that business-as-usual outlook a self-fulfilling prophecy. Over the next five years, Simon said, Exxon Mobil plans to invest at least $125 billion in oil and gas projects that will last for decades. Unlike other energy majors who have at least some investment in the wind, solar, and geothermal industry, Exxon’s only significant “investment” in renewable alternatives to fossil fuels is a $10 million-a-year R&D partnership with Stanford University — about half of Tillerson’s salary and 0.02% of Exxon’s investment in fossil fuel extraction.

Exxon’s energy policy will send us careening to climate disaster. The International Energy Agency (IEA) has calculated that “global emissions will increase 50% by 2030 and more than double by 2050” if the Exxon-desired future comes to pass, “leading to a global average temperature increase of 1.7 to 4.4°C, with a best estimate at 2.8°C” in 2050, which would cross the “tipping point into truly catastrophic change.” It is certainly true that energy policy decisions being made now could have, as Rex Tillerson said, “negative consequences that will be felt for decades to come” — but he is the guilty party.