Those Energy Company Advertisements

There is way too much money being spent on advertising by the major energy companies–at least from the viewpoint of a nonpolitical energy world.

The December 8, 2008, Wall Street Journal, for example, contains a phenomenal 4 1/12 pages of industry ads. For the 20-page front section A, that comes out to about 20%–surely an all-time record. There was a lot of industry advertising back during the energy crises of the highly regulated 1970s, but nothing like this!

There is a massive two-pager by Chevron with a bearded man saying, “I Will Use Less Energy.” Shell’s one pager is: “In the New Energy Future: We’ll Need to Think Around Corners.”  ExxonMobil’s one-pager on the back of Section A is: “The Challenge: Securing America’s Energy Future,” the first installment of six in a series titled “integrated energy solutions.”

It is a shame that so much money is going out the door in this way. This is money that should either go to stockholders as dividends or go toward energy infrastructure. (Or, if corporate philanthropy is your thing, more playgrounds.) And ad buys are just a piece of the total that is diverted into public relations and government affairs that should be going into creating real wealth.

The anti-energy lobby is all too happy to see this money being spent on ink and paper–it displaces real energy production and thus lowers emissions, right? It helps confirm “peak oil,” right?

Given an imperfect world, is this amount of advertising a good thing? I will have to defer to others, but I can editorialize that I like some of the ads better than others. Chevron’s conservation campaign is the most questionable. It has been overtaken by events. If the company had known that oil would be as low as $40 rather than $140 a barrel, perhaps the theme would have been different.

Shell’s campaign is too focused on the “silver bullet” of energy transformation, which to me is premised on a number of fallacies that I will not get into here. ExxonMobil’s is the best in my opinion, explaining how self-interested technology can achieve a variety of social purposes. But normally, that company would just do what it does and not have to tell the world about it, saving that ink to describe how great its retail products are (as retailers do).

BP is not in the bunch, by the way, but their ad campaign from the beginning has been the most disappointing to me (another story for another day).

I wish each and every company campaign would skip the gloss–and to critics on the Left, “greenwashing”–and make the straightforward case that: 1) energy is the master resource; 2) affordable, plentiful energy is a social good; and 3) free-market energy is the best for consumers and society. Talk about “government failure” alongside “market failure.” And so on.

I predict that as the anti-energy nature of the Obama Administration rears its ugly head, the major energy companies will move toward these three themes more. The public will like it because it speaks to their pocketbooks and has a good intellectual case behind it. And it speaks truth to power (yes, government is power, not energy companies who cannot initiate coercion).  But maybe I’m too optimistic during this holiday season.