Shell Eases 2030 Emissions Target

Shell reaffirmed on Thursday its ambitions to be a net-zero energy business by 2050 but eased its carbon intensity target for 2030 as it has shifted away from clean power sales to retail customers.  

The UK-based supermajor said in its updated Energy Transition Strategy 2024 that it would aim for a 15-20% reduction in its net carbon intensity target by 2030, compared to 2016 levels, against a previous target of a 20% cut. The eased emissions target is the result of Shell prioritizing value over volume in power, with a focus on select markets and segments and selling more power to commercial customers, and less to retail customers.

“Given this focus on value, we expect lower total growth of power sales to 2030, which has led to an update to our net carbon intensity target,” Shell said. 

Last year, Shell agreed to sell its retail home energy businesses in the UK and Germany to Octopus Energy Group, in line with its strategy to prioritize countries, projects, and routes to market where it can deliver the most value.

Shell is also retiring its interim 2035 target of a 45% reduction in net carbon intensity, “acknowledging uncertainty in the pace of change in the energy transition,” the supermajor said in its transition strategy update.

But the company introduced a new ambition, “to help drive the decarbonisation of the transport sector.” This ambition is to reduce customer emissions from the use of its oil products by 15-20% by 2030 compared with 2021.

“Our target to become a net-zero emissions energy business by 2050 remains at the heart of our strategy,” Shell Chair, Sir Andrew Mackenzie, said.

Shell, however, also noted that investment in oil and gas would be needed because demand for oil and gas is expected to drop at a slower rate than the natural decline rate of the world’s oil and gas fields, which is 4-5% per year. 

In the summer of 2023, Shell unveiled its new strategy to continue investing in oil and gas production and selectively pour capital into renewable energy solutions, angering climate activists and some institutional investors.

Shell’s CEO Wael Sawan has said that reducing global oil and gas production would be “dangerous and irresponsible” as the world still desperately needs those hydrocarbons.  

By Tsvetana Paraskova for Oilprice.com

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