Exxon lobbying quietly for a U.S. carbon tax

ExxonMobil is quietly lobbying for the U.S. to adopt a carbon tax, both in Washington circles and at the American Petroleum Institute.

For years a denier of climate change, the company is facing probes in New York and Massachusetts over whether it hid its understanding of a link between climate change and the burning of oil and gas. Exxon also has an eye on coming government initiatives to battle climate change thatcould be more intrusive than a carbon tax.

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The Wall Street Journal reports that ExxonMobil has been lobbying members of the U.S. Congress to implement a carbon tax, believing it to be the least painful tool to deal with greenhouse gas emissions.

It is also trying to get that message across inside the American Petroleum Institute and American Fuel and Petrochemical Manufacturers, where many other oil and gas producers believe the most effective strategy is to keep denying the link between burning fossil fuels and climate change.

Carbon tax less intrusive

Oil giants like BP, Shell and Exxon believe they risk more intrusive forms of legislation unless they are seen to be on board with the need to limit greenhouse gas emissions.

"Of the policy options being considered by governments, we believe a revenue-neutral carbon tax is the best," Suzanne McCarron, Exxon's vice president of public and government affairs, wrote in the Dallas Morning News in May.

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A carbon tax that is revenue-neutral meaning other taxes should be lowered to offset the impact is seen as preferable to a welter of overlappingstate, federal and international regulations.

In the past, Exxon funded organizations critical of theKyoto Protocoland helped to found theGlobal Climate Coalition, abusiness groupopposed to the regulation of greenhouse gas emissions.

The corporation has had an official position since 2009 that it supports a carbon tax, but has done little to advance that view until recently.

The WSJ says recent lobby disclosure forms show Exxon officials have met with Capitol Hill offices to advocate for a carbon tax.

Exxon is joining oil companies such as Royal Dutch Shell PLC and BP PLCin publicly advocating for a price on carbon.

Shifting investment in anticipation of new laws

Like many oil giants, Exxon has been shifting its investment into fields that may do better after such a tax is in place. For example, it is backing out of coal, but investing more in natural gas.

It also is pouring money into carbon capture technology, hoping there might be a technological solution that would stop its fossil fuel assets from becomingworth less because of concerted global action on controlling greenhouse gas.

In the wake of the deal struck in Paris last year by 200 nations to reduce greenhouse gas emissions, oil companies know legislation is on the way. Yesterday, Canada, Mexico and U.S. struck a deal to co-ordinate targets for greenhouse gasemissions, especially methane, a byproduct of oil or gas production. And shareholders are beginning to ask questions about where the company stands.

Exxon'spublic change of heart might also have to do with the attempts by several state attorneys to force it to open up its record books to show what it knew about climate change in the past 30 years.

So far, most conservative legislators inside the U.S. oppose a carbon tax, and Democratic contender Hillary Clintion has refused to say where she stands on pricing carbon.