TotalEnergies commits to exiting fossil fuels in South Africa greenwashing case | USAEMALL.com

Hello and welcome back to Energy Source, coming to you from London.

Today’s edition contains not one, not two, but three cases of climate activists taking on Big Oil. From Johannesburg, Rob Rose reports on a first of its kind greenwashing case in South Africa, as TotalEnergies tries to convince sceptics that it really does plan to abandon fossil fuels in the future.

But first, Shell has won a major case in the Netherlands today. The Dutch court of appeal overturned a 2021 case in which Shell was told to slash its emissions by 45 per cent by 2030, relative to 2019 levels.

Shell successfully argued that it should be politicians, rather than courts, that determined the speed of the transition to clean energy, and that by targeting an individual company, it left open the prospect that other players in the market would increase their oil and gas sales to fill any gap.

It was not clear whether Friends of the Earth, which brought the case, would take it upwards to the Dutch Supreme Court.

Meanwhile Laurie van der Burg at campaign group Oil Change International, said: “While we mourn today’s setback, the ruling establishes a responsibility for big oil and gas to act that future litigation can build on. We’re just getting started.

But that’s not the only court case facing Shell today. In the UK, it is arguing, together with Equinor and Ithaca , that it should be allowed to develop two offshore fields in the North Sea.

Greenpeace and Uplift have taken the oil companies to judicial review, challenging the government’s decision to allow the projects in the wake of a judgment in June from the UK’s Supreme Court that all drilling permits should take into account the climate impact of burning the oil and gas produced.

The government has already said it will not fight the latest cases, which threaten Equinor’s $3.8bn Rosebank project and Shell’s Jackdaw project. A verdict is likely to take several weeks. — Malcolm

Total’s climate plans face scrutiny in South Africa 

French oil company TotalEnergies has mounted a spirited defence to accusations that it used greenwashing tactics in South Africa, arguing that it remains committed to a plan to abandon fossil fuels entirely “in the long term”.

In August, the company lost a dispute at South Africa’s Advertising Regulatory Board in which the independent, self-regulatory body found that it was “misleading” for TotalEnergies to claim it was “committed to sustainable development” in a campaign with the country’s national parks.

This is one of many such battles that TotalEnergies is fighting globally, but the first in Africa, underscoring the extent to which advertising has become the new front in the battle between industry and climate activists.

In an appeal hearing earlier this month, Lesego Funde, communications manager at TotalEnergies Marketing South Africa, said the company’s claims in the campaign with South African National Parks — in which it offered prizes to people who uploaded photos at the parks while tagging Total — were “never intended to mislead or promote propaganda in the public domain about the nature of our business”.

Krinesh Govender, the company secretary for TotalEnergies Marketing South Africa, said the company “did not, on the strict definition of greenwashing, engage in any greenwashing.”

Govender said any attempt to paint this as a cynical effort to distract the public was incorrect, as the company had invested heavily in “changing the culture” of its workforce, pushing them to embrace renewable energy sources. “Our long-term goal, and as far as I know it has not changed — it might be a bit easier in Europe — is to exit fossil fuels,” he said.

Asked by the appeal panel what quantifiable data suggested this was indeed the plan, Govender cited the company’s commitments in its sustainability report, its investments in solar energy and the proportion of funding that its treasury had committed to renewables. 

TotalEnergies’ 2024 sustainability report showed total investments of $16.8bn last year, of which 35 per cent was in low-carbon energy — such as biofuels and green hydrogen — and the rest for “maintenance” of oil and gas projects. While it committed to “transitioning away from fossil fuels”, it added the caveat that this must be done “in a just, orderly and equitable manner” and “we cannot ask countries of the global south to not develop their resources”.

Fossil Free South Africa, a non-profit that submitted the complaint to the advertising watchdog and advocates for divestment in oil companies, described TotalEnergies’ argument as cynical and misleading.

“[TotalEnergies’] comments suggesting they’re committed to phasing out and exiting fossil fuels are not reflected by the reality on the ground,” said David Le Page, founder of the group. “A company that is committed to exiting fossil fuels would not be planning new projects.” 

Le Page cited, in particular, the East African Crude Oil Pipeline — one of the largest fossil fuel infrastructure projects in the world now being developed at an estimated cost of $5bn. TotalEnergies owns 62 per cent of the 1,443km pipeline, which would connect Uganda’s oilfields with the Tanzanian coast.

Speaking about the SANParks campaign, Lazola Kati, Fossil Free SA’s advertising co-ordinator, said TotalEnergies had used its sponsorship to “project an image of environmental stewardship”, when it was one of 57 companies responsible for 80 per cent of fossil fuel emissions globally since 2015, according to think-tank InfluenceMap’s Carbon Majors database.

“This contradiction, where TotalEnergies sponsors conservation efforts while also feeling the crisis, destroying habitats and species, is glaring, because at the end of the day, [its] primary business is in fossil fuels,” she said.

While the advertising panel reiterated that oil companies have a right to make use of advertising to advance their business, Le Page proposed that they ought to be required to clearly declare their greenhouse gas emissions in all public-facing marketing. He cited as a precedent the health warnings that tobacco companies are obliged to include on cigarette packages.

Sentiment shifts

The arguments by the non-profit underscored the deep scepticism among environmental groups towards TotalEnergies’ motives behind its sustainability plans. 

This clash, along with several other greenwashing cases that TotalEnergies and its peers are fighting largely in Europe, comes as oil groups are considering the implications of a US led by Donald Trump, who pledged to “rescind every one of Joe Biden’s industry-killing” climate rules.

Last week, TotalEnergies chief executive Patrick Pouyanné urged Trump not to nix climate rules, warning that a “wild west” approach to regulating fossil fuels would only backfire for oil companies. “This will not help the industry, but on the contrary it will demonise, and then the dialogue will be even more antagonised,” he told the Financial Times. 

Nazmeera Moola, the head of sustainability at the London-based asset manager Ninety One, said she did not believe a company such as TotalEnergies would ever be able to reinvent itself entirely as a renewable energy company. 

“There are very different business models required for the oil and gas sector, as opposed to renewables companies. Expecting oil companies to simply transition into renewables companies over the next 10 to 15 years just won’t work,” she said.

Moola said that after an initial flurry of overly optimistic promises, the reality of just how hard it would be for countries to change their energy composition had extended the likely timeline of this transition, giving oil companies an extra few years to adapt.

“Companies like TotalEnergies probably do retain a long-term ambition to move away from fossil fuels, but the timeline has changed due to factors like energy security and the affordability of new green programmes.” 

The second Trump administration, she said, was likely to see US companies retreat even further from climate initiatives as environmental rules were rolled back — giving European oil majors further reason to pause. “These European companies see their US rivals doing well, with few climate plans, so their boards are now less focused on meeting climate goals,” she said. (Rob Rose)

Power Points

Energy Source is written and edited by Jamie Smyth, Myles McCormick, Amanda Chu, Tom Wilson and Malcolm Moore, with support from the FT’s global team of reporters. Reach us at energy.source@ft.com and follow us on X at @FTEnergy. Catch up on past editions of the newsletter here.