Major companies - including BP, ExxonMobil, LyondellBasell, and Dow – have privately lobbied European Commission Vice President Frans Timmermans over the Dutch government’s carbon tax on industrial pollution, new documents reveal.
In a letter obtained by InfluenceMap through a freedom of information request, the companies told the Dutch-born politician that the climate policy could have similar consequences to the “dramatic closure of the mines” in his home region of South Limburg, Netherlands.
“Our people fear for the future of their families. It's not just about tens of thousands direct jobs, but a multiple of that of indirect jobs at (SME) companies in the region,” the letter states. (Full English translation is below)
The 14 companies also claim they are experiencing an “economic crisis” because of the COVID-19 pandemic, and that the carbon tax could harm future investments.
However, Q1 2021 earnings data shows strong profit results for many of the signatories. For example, BP reported profit of $2.6 billion – well ahead of analyst expectations and more than 20 times the previous quarter’s result.
ExxonMobil, from whose email address the joint letter was sent, reported a Q1 profit of $2.7 billion – a dramatic turnaround from it Q4 2020 result.
The 11* publicly listed companies involved in the letter reported a combined group EBITDA of $26.6 billion in Q1 of this year – a 111% increase on the same period in 2020.
“Companies like ExxonMobil and BP publicly claim they support carbon pricing. But this letter shows that when national governments put forward actual policies to implement a price on carbon, these companies privately collaborate to oppose such real-world efforts,” InfluenceMap Analyst Venetia Roxburgh said.
“The fact that these companies are trying to involve a Dutch-born EU official shows the lengths to which they are willing to go to undermine the carbon tax policy.
“Furthermore, the tactic of appealing to concerns around costs and the economic impact of the COVID-19 pandemic is one that many companies have used during the past year. But the latest profit numbers for the companies appear to tell a very different story.”
The carbon tax was established this year as part of a larger climate policy package put forward by the Dutch government. It was modified from the original proposal to soften the impact on industry.
Two of the companies involved in the letter – ExxonMobil and Air Products & Chemicals – have also received significant funding from the Dutch government to subsidize a carbon capture and storage project.
Carbon Market Watch Policy Director, Sam Van den plas, said: "This is disingenuous scaremongering by large multinational polluters. If these companies were serious about wanting to compete on a level playing field, they should be calling for a stronger EU carbon price in line with the example set by the Dutch government. Instead, they use emotional arguments to encourage the EU Commission to undermine and oppose the Dutch carbon levy. The Commission must resist such irresponsible and short-sighted lobbying and for its part ensure that Europe's carbon pricing policies support innovation and drive industrial decarbonization."
Church of England Pensions Board’s Engagement Manager, Clare Richards, said: “Investors expect companies to lobby responsibly in support of Paris-aligned policies and not to seek to delay the policies necessary to encourage a low-carbon economy. The importance of addressing any disconnects between a company’s public rhetoric and its behind-the-scenes policy influence is why we continue to call for greater transparency on corporate lobbying activities.”
Frans Timmermans is in charge of the EU’s Green New Deal plan. The response from his office shows he declined their request for a direct meeting, but were instead offered a meeting with his Head of Cabinet Diederik Samsom.
The 11 companies are Exxon Mobil Corp, Dow Inc., Trinseo SA, LyondellBasell Industries NV, OCI NV, Air Products and Chemicals Inc, BP PLC, Kemira Oyj, Tata Steel Ltd., Saudi Basic Industries Corporation SJSC, and Yara International ASA
For further information or to arrange interviews, please contact:
Simon Cullen, Communications Manager, InfluenceMap (London)
simon.cullen( @ )influencemap.org