Did Shell abandon ambitious strategy to reduce its carbon footprint?

After assuming the role of CEO at Shell Plc, Wael Sawan quietly halted the world’s largest corporate plan for carbon offsets, projects designed to counteract CO2 emissions’ warming effects.

The revised strategy of the European oil giant emphasises on cost reduction and reinforcing profitable verticals like oil and gas. There was no mention of the previous commitment to invest up to $100 million annually in developing a pipeline of carbon credits, an integral part of Shell’s pledge to achieve net-zero emissions by 2050.

Sawan’s decision to discontinue the carbon offsets plan reflects both Shell’s renewed emphasis on its core oil and gas business, which generates a significant portion of the company’s profits, and an acknowledgement of the practical challenges associated with the initial offset targets. Over the past few years, Shell’s efforts in this area have yielded limited results. The company allocated only $95 million, less than half of the initial budget, to develop or invest in various carbon projects. These projects, ranging from Western Africa to the Brazilian Amazon and Australian farmlands, have generated minimal offsets and faced difficulties in maintaining the desired quality standards.

This development casts a critical light on carbon offsets, which have gained prominence as a climate solution for numerous major corporations. The voluntary carbon market, valued at around $2 billion today, could potentially balloon to $950 billion by 2037, as estimated by Bloomberg New Energy Finance.

While criticisms have traditionally centred on the quality of offsets, Shell’s experience reveals that achieving both volume and quality remains a formidable challenge. The scale and high standards, essential for environmental credibility, often counteract each other, presenting a formidable dilemma in the pursuit of effective offsets.

Related Posts
Others have also viewed

C-Crete advances cement-free carbon-negative concrete product with $2M DOE boost

C-Crete Technologies is developing a method for using carbon dioxide captured at industrial sources or ...

Albemarle and Caterpillar: pioneering zero-emissions lithium mine

Albemarle Corporation, a global leader in essential elements for mobility, energy, connectivity, and health, has ...

Saudi’s oil giant announces first global liquified natural gas deal

Saudi Aramco announced its first global investment in liquefied natural gas, part of a broader ...

Petrobras and Vale to seek joint renewable investments

Vale has entered into a protocol of intent with Petrobras, one of the world’s largest ...