Summary of Council decision:
Two issues were investigated, both of which were Upheld.
A paid-for online display ad for Repsol, a global energy company, seen on a newspaper website on 2 February 2023, featured several images of leaves with text that stated, “At Repsol, we are developing biofuels and synthetic fuels to achieve net zero emissions”. After which a car was shown parked in a wooded area, surrounded by leaves, with text that stated, “Renewable fuels for more sustainable mobility”. In the top left-hand corner of the ad was a stylised outline of a petrol pump within which was a leaf.
1. Adfree Cities, who understood that Repsol’s business activities included substantial, ongoing and expanding fossil fuel production, challenged whether the ad was misleading because it omitted significant information about the overall impact of Repsol’s business activities.
2. The ASA challenged whether the basis of the claim “At Repsol, we are developing biofuels and synthetic fuels to achieve net zero emissions” was clear.
1. Repsol said that by adding the message “Find out more about this and other projects”, accompanied by a button with the message “More information” at the end of the ad, the reader was invited to click and access Repsol’s website. Once accessed, the website provided further information and news related to the company’s global activity. They believed that it was impossible to maintain the attractiveness of the ad and place more information within it.
Repsol explained that the ad was mainly designed for inclusion in the Financial Times (FT) digital energy newsletter sponsored by Repsol, aimed at an informed audience of users who subscribe to it and are interested in issues and news related to the energy sector. They acknowledged that the ad was also published elsewhere on the FT’s website.
Repsol said that they opened Spain’s first electric charging point, and operated Spain’s largest public electric vehicle charging network. In addition, they are a significant operator in the electricity and gas market in Spain, with 1.5 million customers. They currently have an installed renewable generation capacity of more than 1,800 MW worldwide and plan to reach 6,000 MW by 2025 and 20,000 MW by 2030. They produce an average of approximately 600,000 barrels of oil equivalent per day, of which nearly 70% is gas. Their hydrocarbons production is focused on gas since the fuel helps transition from higher-emissions coal to electricity production, thus speeding up the energy transition. They further stated that oil will still be needed in a more decarbonized world, even according to the International Energy Agency’s most aggressive scenarios.
Repsol summarised that they have reduced energy consumption in their industrial centres by 20% in the period 2011-2022 and reduced emissions by more than 20% in all their facilities.
2. Repsol said they were aware that there is no single solution for sustainability. They explained that renewable fuels are one of the main elements in the company’s strategy to reach net zero by 2050. They aimed to reduce 55% of emissions from operated assets and 30% of net emissions by 2030. They also stated that they set a target for reducing their methane emissions intensity to 0.20% in 2025, which would be a reduction of 85%.
Repsol said that they will allocate more than €5 billion in organic investment and that 35% of these investments will be allocated to low-carbon technologies and projects. The company has implemented a methodology to determine whether a new investment is in line with its decarbonisation targets, and any investment proposed to the Executive Committee and the Board of Directors must include a report prepared by their Sustainability Department. In the second half of 2023 they are introducing a new biofuels facility that will supply 250,000 tons per year of advanced biofuels. The use of these fuels will make it possible to avoid emissions of 900,000 tons of carbon dioxide per year. They also are preparing to build synthetic fuels and urban waste recovery plants and have partnered with Enerkem to develop a plant which will process around 400,000 tons of non-recyclable municipal solid waste to produce around 240,000 tons of renewable methanol (biomethanol).
Repsol explained that renewable fuels make up 10% of their fuel sales in Spain and they expect to grow this aggressively. They have existing pilot projects in three cities which involve 100% biofuel pumps for fleet vehicles and have also launched a recent initiative to pay customers for their used cooking oil for incorporation into the processing of fatty residues. Repsol said they are committed to acting ethically and would remove the ad immediately.
The ASA welcomed Repsol’s assurance that the ad would be removed. The CAP Code stated that unqualified claims could mislead if material information was omitted.
The ad appeared within the FT’s digital energy newsletter and elsewhere on the FT website. It would therefore have been seen by both consumers, who may be interested in Repsol as a brand for the products and services they provide, and business readers, such as potential investors, partners and clients. We considered that both audiences would have an awareness that many companies in carbon-intensive industries, including the oil and gas sector, aimed to dramatically reduce their emissions in response to the climate crisis. In addition, both were increasingly concerned about the environmental impact of activities related to higher-carbon products and services, and would be interested in seeking out businesses, including oil and gas companies, who were making meaningful progress towards transitioning away from higher-carbon products and services, including towards achieving net zero emissions. However, we considered that consumers and many business readers were unlikely to be aware of the specific details of how companies planned to achieve this.
We considered that both consumers and business readers were likely to interpret the claim, “At Repsol, we are developing biofuels and synthetic fuels to achieve net zero emissions”, in addition to the imagery of nature and the natural environment, as meaning that Repsol’s development of biofuels and synthetic fuels formed a significant element of their current activities that were making meaningful progress towards achieving net zero emissions.
We acknowledged Repsol’s comments regarding their contribution to electrical charging, renewable generation capacity, and reductions in energy consumption and emissions in industrial centres in other facilities. However, notwithstanding current actions towards improving their environmental impact, we understood that a number of Repsol’s new biofuel and synthetic fuel initiatives were not yet in operation. Furthermore, Repsol’s carbon emissions stood at 171 million tonnes of CO2e in 2021 (50% of the emissions of the United Kingdom in 2021, 346.7 Mt CO2e). They produced approximately 600,000 barrels of oil per day. We also understood that Repsol had a substantial oil and gas exploration strategy, owning an interest in 40,660 acres (gross) of oil and gas development and exploration across Europe, Latin America, North America, Africa, and Asia and Oceania.
We acknowledged that Repsol’s hydrocarbons production focused on gas and understood the reasons for that. We also acknowledged that oil would continue to play a legitimate role in the context of energy transition in the future. However, we understood that their focus on the production of biofuels and synthetic fuels to achieve net zero emissions was a fraction of their business activities when compared to their substantial, ongoing, and expanding fossil fuel production. Furthermore, notwithstanding the reasons given for the continued production of oil and gas, we noted that the ad focused solely on an initiative the company suggested would deliver their net zero goal (with no timeframe given) when at the same time, Repsol was continuing to emit notable levels of carbon dioxide and other greenhouse gasses and would do so for many years into the future.
We understood that consumers could access information about Repsol’s general business activities and plans on their website. However, further information to contextualise how and when Repsol would achieve net zero emissions, and the role that the development of biofuels would play in that plan, was material to consumers’ understanding of the ad’s overall message, and should have appeared in the ad itself.
We therefore concluded that the ad omitted material information and was misleading.
On this point, the ad breached CAP Code (Edition 12) rules 3.1, 3.3 (Misleading Advertising), and 11.1 (Environmental Claims).
The CAP Code required that the basis of environmental claims must be clear.
We acknowledged Repsol’s target to reach net zero emissions by 2050 and their objectives regarding emissions from operating assets, net emissions and methane emissions. We also acknowledged their aims and investments regarding biofuels and synthetic fuels. Further we noted the changes made to their investment process. We understood, however, that Repsol did not only accept investment opportunities based on carbon reducing activity.
We acknowledged Repsol’s comment that there is no single solution for sustainability, and that renewable fuels are one element in the company’s strategy to reach net zero by 2050. However, while we agreed that synthetic fuels and biofuels could contribute towards Repsol’s goal of achieving net zero emissions, they would not as a single measure ‘achieve’ net zero emissions. We also considered that in the context of an ad making a claim based on initiatives to achieve net zero, the timeframe of 2050 to achieve that goal was material information that needed to be made clear to consumers.
In the absence of any contextual information explaining that the initiative was part of a wider plan to achieve net zero by 2050, we concluded that the basis of the claim “At Repsol, we are developing biofuels and synthetic fuels to achieve net zero emissions” was not clear and it was likely to mislead as a result.
On this point, the ad breached CAP Code (Edition 12) rule 3.1, 3.11 (Misleading Advertising), and 11.1 (Environmental Claims).
The ad must not appear again in the form complained of. We told Repsol that the basis of environmental claims in future marketing communications must be clear, and to ensure that their marketing communications did not misleadingly omit material information, such as how and when Repsol would achieve net zero emissions, and the role that the development of biofuels would play in that plan.