Oil firms' renewable investments lag image

By Tom Bergin - Analysis

LONDON (Reuters) - Oil majors love to boast about their renewable energy activities but the glossy advertisements showing windmills and solar panels often mask modest investments and even skepticism.

The companies say their investments show they are doing their part to help fight climate change.

Environmentalists counter that the spending is inadequate and aimed solely at deflecting criticism away from the role that burning oil and gas plays in global warming.

"The advertising campaigns that are suggesting a big green shift within these companies are misleading," said Tony Juniper, executive director at Friends of the Earth.

Juniper said oil companies' acknowledgement of climate change had been more constructive in fighting climate change than "the few wind turbines they've built".

Despite the millions spent publicizing their green credentials, none of the big international oil companies publishes figures for annual investments in renewable energy, making it hard to judge whether actions match adverts.

Nonetheless, a review by Reuters of published material, figures from company spokespersons and analysts' estimates does give a good indication of investment since the end of the last decade, when the oil industry started to catch the green bug.

Royal Dutch Shell Plc says it invested over $850 million in renewables, largely wind power, in the past five years. This excludes spending on hydrogen projects, which rely on natural gas, and biofuels.

Analysts estimate that biofuels investments added around another $100 million over the period and that Shell invested around $100 million per year 1999-2001 in green energy.

A spokeswoman said official figures were not available but did not dispute the estimates.

These figures suggest a total investment by Shell 1999-2006 of around $1.25 billion, making the Anglo-Dutch company the oil business's biggest investor in green energy.

This reflects Shell's aim of developing a significant business based on one renewable energy source. However, its spending is just 1 percent of its total capital budget over the period -- $121 billion.

BEYOND PUBLICITY

BP Plc, whose "Beyond Petroleum" slogan set the tone for the greening of the oil industry, is second with an investment of around $900 million in renewables since 1999, according to published figures and information from BP sources.

BP has been active in solar power since 1980 and in the past year has ramped up investment in wind, since the London-based company launched its Alternative Energy division.