WEMO 2025 (complet) - Flipbook - Page 51
W E M O 202 5
O U T LO O K
In recent years, some large oil and gas companies like BP and
Shell have signi昀椀cantly scaled back their commitments to lowcarbon energy and emissions reduction377, shifting focus to
more pro昀椀table oil and gas production. BP, once a leader in
climate action, abandoned its 2030 target to cut oil and gas
production by 40% and revised its emissions reduction goal
from 35-40% to 20-30% by 2030. 378
In July 2025, it announced that it agreed to sell its US onshore
wind business to LS Power. The business includes interests in
10 operating onshore wind assets across seven US states with
a total generating capacity of 1.3GW net.
The root causes of this pivot include a focus on higher 昀椀nancial
return on oil and gas projects compared to less pro昀椀table
renewable energy projects due to their increasing costs,
regulation complexity and political uncertainties.
The retreat of oil majors from low-carbon commitments is
bad news for global emissions reduction goals as the top 5
investor-owned companies (ExxonMobil, Chevron, Shell,
TotalEnergies, and BP), accounted for a combined 2.2 GtCO2
(equivalent to 5.1% of global fossil CO2 emissions).383
has compelled European nations to signi昀椀cantly increase their
defence budgets384. They now aim at increasing their defence
spendings to 3.5% of their GDP385 with countries like Poland
aiming to 5%.
With EU debt-to-GDP at 81%386 and de昀椀cits at 3.2% in 2024,
new funding space is limited. EU could be tempted to
reallocate part of the €580 billion set aside in the 2021-2027
multiannual budget to achieve climate neutrality by 2050387.
Balancing climate actions and military priorities will require
innovative 昀椀nancing to avoid compromising climate goals.
Fears are growing that the development budgets reductions
will also threaten the COP29 agreement to provide $300 bn in
annual climate 昀椀nance to developing nations388. That is after
the U.S. announced it was abandoning the “loss and damage
fund”389, established after the COP28, in Dubai.
Will the energy transition's extra costs reduce
public support for sustainable energy?
The Trump administration’s reduction in U.S. funding for
NATO, coupled with ongoing Russian aggression in Ukraine,
E昀昀orts to move electricity generation to cleaner resources
require heavy capital investment – between $3.5 trillion and
$4.5 trillion per year globally – to achieve a zero-carbon
economy by 2050. This cost is being borne across various
industries, public and private funds, and individuals.390
昀昀shorewind.biz/2024/11/27/totalenergies-halts-us-o昀昀shore-wind-project-amid-politicaluncertainty/#:~:text=TotalEnergies%20Halts%20US%20O昀昀shore%20Wind,York's%20
latest%20o昀昀shore%20wind%20solicitation.
383
https://carbonmajors.org/brie昀椀ng/The-Carbon-Majors-Database-2023-Update-31397
384
https://www.bruegel.org/analysis/defending-europe-without-us-昀椀rst-estimates-what-needed
385
https://www.heritage.org/defense/report/
natos-underspending-problem-americas-allies-must-embrace-fair-burden-sharing
386
https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-22042025-ap#:~:text=In%20
the%20euro%20area%20the,from%2080.8%25%20to%2081.0%25.
387
https://www.heritage.org/global-politics/commentary/
eu-should-prioritize-defense-not-climate-change-funding
388
https://unfccc.int/news/cop29-un-climate-conference-agrees-to-triple-昀椀nance-to-developingcountries-protecting-lives-and
389
https://昀椀ftrustee.worldbank.org/en/about/unit/d昀椀/昀椀ftrustee/fund-detail/frld#:~:text=In%20
a%20historic%20decision%20at,and%20the%20eradication%20of%20poverty.&text=An%20
unexpected%20error%20occurred.,contact%20your%20Tableau%20Server%20Administrator.
390
https://www.publicpower.org/periodical/article/what-will-energy-transition-cost
391
For example: to isolate their house or to change car after2035 to buy an EV
392
https://www.city-journal.org/article/the-political-cost-of-the-energy-transition
Will the EU's increased defense spending lead to
a reduction in its climate change initiatives?
382
https://grist.org/economics/bp-exxon-shell-backing-o昀昀-climate-promises/
378
https://www.bp.com/en/global/corporate/news-and-insights/press-releases/bp-agrees-to-sellus-onshore-wind-business-to-ls-power.html
379
https://zerocarbon-analytics.org/archives/energy/
unpacking-the-energy-transition-strategies-of-oil-and-gas-majors
380
https://globalclimateinitiatives.com/en/e-brochures-knowledge/direct-and-indirectemissions/#:~:text=Scope%201%3A%20Direct%20GHG%20emissions,imported%20for%20
the%20organization's%20activities.
381
https://totalenergies.com/sustainability/climate-and-sustainability-energy/
reducing-our-scope-1-and-2-emissions
377
WEMO 2025
Big oil & gas companies are reducing their
commitments on climate actions.
Contrary to BP’s rollback of climate commitments, Total
Energies maintained its climate actions379, continuing to
invest in low-carbon energies. In 2024, it allocated €5 billion
(27% of its capital expenditure) to renewables, low-carbon
fuels, and electricity, commissioning 1.5 GW of solar and wind
capacity and targeting 100 GW of renewable capacity by 2030,
alongside a 30% reduction in Scope 1 and 2 emissions380 by
2030 from 2015 levels381.These commitments are driven by EU
regulatory pressures and shareholder support for its net-zero
2050 goal. However, at the end 2024, TotalEnergies paused
the development of its o昀昀shore wind project in New York,
citing political uncertainties 382
50
via the Turk Stream pipeline, despite EU e昀昀orts to reduce
Russian fossil fuel dependence. Critics highlight Hungary’s
slow progress on reducing gas consumption and urge
stronger energy e昀케ciency and renewable measures to meet
climate goals.
