IEA warns oil and gas companies about lax emission policies

IEA warns oil and gas companies about lax emission policies

The International Energy Agency (IEA) on Monday cautioned oil and gas companies that failing to increase investments in low carbon energies may result in them facing backlash that could threaten long-term profits and public support. Around 15% of global energy-related emissions have come from the process of drilling out oil and gas, the IEA added.

In a report with the World Economic Forum presented in Davos, the IEA said that oil and gas companies face a critical challenge as the world slowly adopts clean energy transitions to curb global warming. Furthermore, the companies have yet to respond to demands to explain how they would reduce emissions in line with the 2015 Paris climate agreement.

“Every part of the industry needs to consider how to respond. Doing nothing is simply not an option,” IEA’s Executive Director Fatih Birol, said in a statement.

The IEA said that a key move for oil and gas companies would be to invest in cleaner fuels such as hydrogen, biomethane, and advanced biofuels.

So far, average investment by the sector is still limited to around 1% of total capital spending, being mainly focused on solar and wind projects.