Shareholder intervention has helped to produce Shell’s green plan, a way to cut the energy giant’s climate impact. But questions remain, writes Mitchell Beer for The Energy Mix.
A leading producer of fossil fuels, which last month announced its intention to reduce its contribution to the global warming stoked by society’s prodigal consumption of its products, may now be feeling a little crestfallen. Shell’s green plan leaves some critics saying the group’s figures don’t add up very impressively.
Royal Dutch Shell pledged last month to cut its net greenhouse gas emissions 20 percent by 2035 and 50 percent by 2050, while investing US$1-2 billion per year in renewables, and electric vehicles between 2018 and 2020.
The group said its announcement was a response to shareholder pressure and the targets in the Paris Agreement on cutting emissions.
“Tackling climate change is a cross-generational, global, and multi-faceted effort,” said CEO Ben van Beurden. “This is a challenge for the whole planet, for all of society, for customers, for governments, and indeed for businesses.
“It will mean meeting increasing energy demand with an ever-lower carbon footprint. And it is critical that our ambition covers the full energy life cycle, from production to consumption. We are committed to play our part.’’
The announcement earned measured praise from environmental groups, and van Beurden said the commitment was just a first step.
But the cash infusion to Shell’s new energies division was still well below 10 percent of the company’s total annual investment, and the phrasing of the GHG promise suggested an intensity-based target – which would mean the 20 and 50 percent reductions will be calculated on fossil production levels that Shell will expect to increase year after year.