^ Net emissions from its own operations and the bulk of greenhouse gases from the fuel
Source: Fugitive Emissions Journal
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The energy giant is following in the footsteps of its peers BP Plc and Repsol SA, which have already set similar targets. Shell’s move indicates that, despite the turmoil caused in the industry by COVID-19, major oil and gas companies aren’t abandoning the transition to cleaner energy. “Society’s expectations have shifted quickly in the debate around climate change. Shell now needs to go further with our own ambitions,” Chief Executive Officer Ben van Beurden said in a statement. “Even at this time of immediate challenge, we must also maintain the focus on the long term.”
Lower carbon products
Shell aims to have net-zero emissions from its own operations, categories known as scope one and two, by 2050. It also intends to reduce the carbon footprint of the energy products it sells to customers, scope three emissions, by around 30 per cent by 2035 and 65 per cent by 2050. To achieve this, the company will sell products with lower carbon intensity, such as renewable power, biofuels and hydrogen. The Anglo-Dutch oil major will work with industries such as airlines to help them decarbonize, and ultimately, will only do business with emission free companies, van Beurden said on an investor conference call.
Shell said it’s offering more low-carbon power, providing offsets and has even sold liquefied natural gas cargoes with net-zero emissions. But more needs to be done and at a faster pace to achieve the goals it has set, van Beurden said. It’s linking the pay of 16,500 employees to carbon-reduction targets, extending an existing plan that ties executive renumeration to cutting greenhouse gases by as much as 3 per cent by 2021.
Event information
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Shell and Eni leading
The Transition Pathway Initiative, which assesses how prepared companies are for the transition to a low carbon economy, stated that “European integrated oil & gas companies have significantly increased their ambitions over the last six months, with Shell and Eni leading in the race to make their operations carbon neutral. However, all need to go further to achieve their targets. None of the companies in the analysis were yet aligned with the (Paris) agreement’s goal of limiting the heating of the atmosphere by a further 2°C by 2050, or the more ambitious interpretation of the agreement of limiting temperature rises to 1.5°C.”
Shell’s goal to cut its emissions by 65 per cent by 2050 was the most ambitious in the sector and closest to being aligned with the 2°C target, TPI says. But it added: “Shell’s claim that it will be aligned with a 1.5°C climate scenario is not consistent with our analysis.” A Shell spokesperson said: “By 2050 or sooner Shell intends to be a net-zero emissions energy business. We need to look at the detail of this report, but we are pleased our ambition is recognised and we are confident our approach is aligned with the 1.5°C goal of the Paris Agreement.”
