On Wednesday and Thursday of this past week, I attended the 2022 Global Energy Forum at Stanford, a biennial gathering focused on the evolving energy ecosystem. This year’s agenda was compelling, with speakers from top corporate and government institutions and topics ranging from clean transportation to corporate pledges to government financing. I hoped to learn about some new challenges and interesting work that I could cover in future blog posts, and I do have some good ideas. But I am surprised to find myself writing about the Forum itself for this post.
The two-day Global Energy Forum was organized into a series of one-hour panels. A moderator would introduce an area and then ask questions of the experts on stage before choosing from questions that the audience had submitted. This worked out well and there was some interesting discussion. There were two exceptions to this format. On Wednesday Senator Joe Manchin dialed into a virtual “fireside chat” to discuss the Inflation Reduction Act with Professor Steven Chu, and on Thursday Exxon CEO Darren Woods took the stage to answer questions from Exxon board member Alexander Karsner.
This is where I started to wonder about the influence of Exxon funding at Stanford’s Precourt Institute for Energy, the Forum’s sponsor, which is part of the Doerr School of Sustainability at Stanford. What has Exxon accomplished recently that is so laudable and noteworthy as to merit a solo hour on stage at this event? Just the day before, Karsner had hosted a panel on “Energy Company Transitions” with senior executives from Shell and TotalEnergies. It would have been terrific to have a US oil company on stage with those two European firms. And yet Woods was given almost a full hour on his own.
The main thing I recall Woods talking about was the way that Exxon reorganized earlier in the year to be more flexible as they transition their business to include work on green hydrogen, biofuels, and carbon capture and storage. (1) Exxon has switched from 11 companies, each with their own R&D labs, to three companies that share central R&D and engineering capabilities. The idea is to make it easier for them to shift resources between businesses as some grow more quickly than others. It also puts their growing low carbon business on the same level as their fossil fuel and petrochemicals businesses.
That makes a lot of sense to me, and you can read more about it here. But is a corporate reorganization really enough to elevate Exxon to its own “fireside chat”? The Exxon CEO got more stage time than anyone else at the conference except for Karsner, who was interviewing him. And unlike in any of the other panels or interviews, Karsner didn’t engage much or even at all with the audience questions, though there were some good ones. For example, Exxon does not include Scope 3 emissions in its goals, while both Shell and TotalEnergies do. It would have been great to get Woods’ take on that, and even more so if they were all on the same stage.
Instead Karsner offered up his own questions during what was meant to be the Q&A period. He ended with “If you could wave a magic wand and have some technology become reality, what would it be?” I thought Woods might suggest something like “low cost synthetic fuel”, since that is in their domain and we had just heard from Airbus about the challenges we have with low-emission flight. But Woods’ answer was that he would like to see negative emissions at scale. I was struck by that, because it doesn’t help his business evolve and get cleaner, it just facilitates the growth of their old, polluting business. Why is that his number one choice? So they don’t have to change anything? It seems backwards looking at best. (2)
When the European oil majors (Shell and TotalEnergies) were on the stage, I submitted the question that I discussed in an earlier blog, a question that was asked of a Chevron executive at UC Berkeley. “You have a choice between following the market and meeting demand for clean energy, or using your considerable leverage in the energy ecosystem to accelerate the transition to clean energy. What are you doing to proactively help and encourage your customers to switch to clean energy?” The Chevron exec had pushed back hard against this question, saying it was not their business to influence demand. So I was curious to see what the Europeans would say, though I suspected they might just skip over the question.
To my surprise, the TotalEnergies executive specifically picked out my question saying “This is a great question!” and responded with something like “Yes, it’s frustrating right, we don’t control demand but we need to influence it in order to hit our goals. So, there are a couple of things that we are doing. As one example, there is a sort of a chicken-and-egg between people who want an EV but are waiting for more charging infrastructure to be deployed, and the charging infrastructure waiting for there to be enough demand from EVs. So we said, okay, we are just going to go out in front and build the charging infrastructure. We are putting in 150,000 charging stations by 2024.” He didn’t duck the question, instead he embraced the question and was able to elucidate some of the corporate strategy around it.
The Exxon CEO in constrast sounded much like the Chevron CFO at Berkeley, saying that Exxon will respond to demand with the lowest emissions possible; that when the transition happens, Exxon will be ready; that price is a function of supply and demand, and with demand going up supply needs to go up; etc. Exxon is a mere passive participant in a market that is beyond their control.
All of this is to say that, by the end of the Exxon hour, I was feeling a little queasy. The conversation was very chummy, the questions very soft, and the session went well beyond its allocated time, with Karsner joking about how he was annoying the host with this. I can only listen to so much of “Tell me, why would Stanford students want to come and work at a place like Exxon?” (3) When it ended, I grabbed a packet of M&Ms from the host desk thinking they might make me feel better, and headed outside for some fresh air. And what happened then is why I am writing this blog.
Outside the patio, just past a barrier, a group of people stood with signs reading “Exxon Knew”, “Shut the Doerr on Fossil Fuel”, and “Stop Fossil Fuel Capture”. Some wore costumes and one hit a small gong as they chanted “Hey hey, ho ho, Exxon funding’s got to go”. I was curious and moved closer to take a look. As I realized what the group was about, a smile spread across my face and I sank into a chair nearby to soak in the hope and relief that I felt from this protest. I noticed other attendees lingering as well, watching and listening. After a while one of the protestors picked up a microphone and talked about the history of Exxon, their complicity and even leadership in climate denial and climate delay, and their low level of investment today in clean technology relative to their traditional business (less than 10%).
Many Stanford students, faculty, and staff have led a campaign for months to encourage the Doerr School of Sustainability to refuse fossil fuel funding and sponsorship. Dean Arun Majumdar has shared his thoughts on this topic, encouraged people to have open minds and patience, and has said that he will listen and come to a conclusion at the end of fall quarter. I now have a somewhat more informed opinion about this. I believe that oil and gas companies need to transition and that we should help them to transition. Their scale and influence can be a big lift. But they need to be sincere and committed, forthright about the damage (and good) that their products are doing, and willing to spend much of their recent windfall profits to accelerate the clean energy transition. They should be championing and acting in lock step with our Paris ambitions. Exxon is not there. And it may well be that most others aren’t as well. So for Stanford’s Doerr School of Sustainability to lionize the CEO on a stage is just wrong. I don’t disagree with Majumdar when he writes “I believe the businesses trying to make a meaningful effort to change ought to be allowed some room and time to change their course and align their values, goals, and actions to address climate change.” But you can give people room without giving them a stage.
In my opinion, Stanford needs to look beyond words to commitments, beyond commitments to actions, and beyond actions to investment. The protesters are right to protest, and I hope that Majumdar and Doerr listen. I don’t want to go to Stanford again and have the same feeling and experience that I did with that Exxon performance.
Notes and References
1. Oil and gas companies often branch out into those three areas because they use many of the skill sets of their employees, and Exxon is no exception. The only thing I missed hearing him talk about was geothermal exploration.
2. We absolutely need negative emissions, but the oil and gas companies should not be focused on that, and in fact we want them to push ahead as if there are none, not grow to rely on them.
3. One thing that’s interesting is that Karsner was brought onto Exxon’s board, against Woods’ will, to help the company transition to clean energy. So maybe he is making inroads and helping the company to change, and this performance was an attempt to help Woods feel good about it. But even if that is the case, Stanford doesn’t have to be complicit in that.
Current Climate Data (September 2022)
Global impacts, US impacts, CO2 metric, Climate dashboard
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