Exxon Mobil (NYSE: XOM) isn’t an obvious clean-energy champion; indeed, last May CEO Rex Tillerson told investors that he didn’t dabble in clean-energy projects because he preferred “not to lose money on purpose”. That made it all the more surprising, then, when the oil giant announced last week that it had been working since 2011 on a joint project with clean-tech specialist FuelCell Energy (NASDAQ: FCEL) aimed at cleaning up power plant emissions. 

The project, which Exxon and FuelCell are now preparing to commercialize, hinges upon a new carbon-capture system (CCS) that uses fuel cells rather than the exhaust scrubbers typically used to clean up smokestacks. The technology removes about 90 percent of the carbon and 70 percent of the nitrogen oxides from emissions by feeding the gases through a fuel-cell system that simultaneously generates energy and concentrates carbon into a more easily stored form.

That’s potentially a game-changer for the CCS sector, since conventional scrubbers require significant amounts of energy to run, effectively reducing a power-plant’s output. FuelCell’s technology, by contrast, actually increases the total amount of energy produced: Exxon estimates that a 500-megawatt natural gas power plant equipped with FuelCell’s technology would see its output increase by 120 megawatts, versus a 50-megawatt reduction using conventional scrubbers. 

FuelCell’s technologies are already in use at dozens of sites around the world, but haven’t yet been rolled out at power plants. That’s the big leap forward that Exxon is hoping to facilitate, both by stumping up the capital needed by FuelCell’s researchers, and by providing strategic and marketing expertise. More R&D work is needed, and the final launch could be years away; still, officials are bullish about the technology’s potential. “This is a global opportunity and it’s a U.S. technology leading the way. We have to move as quickly as we can,” FuelCell CEO Chip Bottone told Bloomberg

The Exxon endorsement is undoubtedly good news for FuelCell, which can now count on Exxon’s deep pockets and sheer scale as it brings its CCS technology to market. The company, which has received more than $19 million in U.S. Energy Department support and counts NRG Energy (NYSE: NRG) as its second-largest shareholder, saw its stocks spike 25 percent following the announcement. The company’s valuation has since slipped back, but analysts remain positive about the stock, which has comfortably outperformed the Nasdaq over the past year, with Craig Hallum analysts giving the stock a buy rating.

More significantly, however, the deal is also an important indication of Exxon’s own long-term strategic thinking. Despite CEO Tillerson’s dismissive rhetoric, the company is well aware both that climate change is a real and pressing problem, and that investors are increasingly concerned that fossil fuel companies will see their hydrocarbon assets stranded as governments begin to put a price on carbon emissions.

That reality is increasingly driving fossil fuel giants to invest in cleaner energy technologies. Biofuels have historically been a big winner — and a favorite of Exxon — with oil majors investing $9.4 billion in ethanol and other biofuels between 2005 and 2013. Now, companies are branching out into other clean-tech areas: Total SA (NYSE: TOT) just inked a $1.1 billion deal to buy battery maker Saft Groupe SA (EPA: SAFT), while Canada’s Enbridge Inc. (TSE: ENB) is spending $218 million to buy stakes in offshore wind farms. “The supermajors recognize there is going to be tremendous growth in low-carbon sources of energy,” says Jason Bordoff, director of Columbia University’s Center on Global Energy Policy. “To thrive in the long term, they need a mix in their portfolio.”

Exxon’s decision to climb aboard the alt-energy bandwagon doesn’t mean that it will walk away from its core oil-and-gas business, or that it’s on the brink of a Damascene conversion from which it will emerge as an unequivocal champion of clean energy. But it does mean the company is likely to keep on incrementally diversifying its portfolio, and seeking out ways to hedge its fossil-fuel liabilities through careful investments in clean technologies. 

That approach could eventually lead Exxon to become a bona fide clean-energy player — think “Exxon Solar” — in coming months or years, writes Investing.com analyst Scott Fearon. “If (or, rather, when) solar technology improves to the point that it threatens Exxon’s market share in a serious way, you’d better believe the company will do what’s needed to become a major player in that space,” he writes. 

In the meantime, the FuelCell deal is right in Exxon’s sweet spot — an investment that could provide the company with a useful carbon-negative revenue stream, while simultaneously helping to shield its natural-gas assets from the impact of carbon pricing. It’s a deal, in other words, that’s founded not on a desire to save the planet, but rather on an attempt to protect the company’s bottom line. Ironically, Exxon’s aversion to “losing money on purpose” could wind up being the very thing that forces it, and the rest of the fossil-fuel sector, to get serious about investing in clean energy technologies. 

Ben Whitford is the US correspondent for The Ecologist. He has written for the Guardian, Newsweek, Mother Jones, Slate, and many other publications.