Shell's $300 million nature investment steps toward a 'low-carbon future'
As Total completes its latest renewables acquisition, Shell steps up emissions reduction efforts with a new ecosystems offset effort.
Shell unveiled the latest part of its new emission reduction strategy Monday, announcing plans to invest $300 million over the next three years in natural ecosystem-based projects.
The oil giant said the new program, which initially will focus on reforestation partnerships in Spain and the Netherlands, is designed to support its recently announced target to reduce its Net Carbon Footprint by 2 percent to 3 percent over the next three years. It added that the emissions savings that should result from the work to restore and protect natural ecosystems also would serve to address carbon emissions generated by the customers who use Shell's products.
Ben van Beurden, chief executive at Royal Dutch Shell, said the latest investments are part of the company's wider emission reduction strategy, which has seen the oil giant step up investment in electric vehicle charging infrastructure, renewables and other clean technologies in recent years.
"There is no single solution to tackling climate change," he said in a statement. "A transformation of the global energy system is needed, from electricity generation to industry and transport. Shell will play its part. Our focus on natural ecosystems is one step we are taking today to support the transition towards a low-carbon future. This comes in addition to our existing efforts, from reducing the carbon intensity of oil and gas operations to investments in renewable sources of energy."
Shell also has signed a deal with Land Life Company to create a 740-acre reforestation project in Spain, where around 300,000 trees will be planted in the Castilla y Leon region by the end of this year.
In addition, the company confirmed that it will link its new and existing investments in natural emission reduction programs to a new offset service for customers. From April 17, customers who buy Shell V-Power petrol or diesel will be able to offset their emissions at no extra cost, while those who fill up with regular Shell petrol or diesel can participate in the scheme for an additional 1 cent a liter. The firm said it will roll out similar offers in other countries.
The announcement is the latest in a string of moves by Shell to cut its operational emissions, pivot to offer a wider range of clean tech services and incentivize senior managers to deliver emissions reductions.
Last week the company also announced it would quit the American Fuel & Petrochemical Manufacturers (AFPM) trade body, citing a "material misalignment" over climate policy. The company said AFPM had not stated its support for the Paris Agreement, creating a misalignment with Shell's goals.
The decision came as part of a review of the 19 trade bodies Shell is signed up to globally. Van Beurden stressed Shell should be willing groups to quit groups that work counter to its climate goals. "We must be prepared to openly voice our concerns where we find misalignment with an industry association on climate-related policy," he said in statement. "In cases of material misalignment, we should also be prepared to walk away."
However, Shell's moves do appear to have bought it some breathing space with some investors.
Reports over the weekend revealed that the Follow This group of activists has withdrawn a resolution ahead of the company's AGM that would have called on it to drastically reduce its spending on fossil fuel infrastructure.
The group said that following talks with six leading Dutch investors, it was pulling the resolution for this year to give the firm time to demonstrate it is making progress towards delivering on its new emissions targets and its wider goal to move into line with the Paris Agreement.
In related news, Total Eren, the renewables arm of oil giant Total, announced it has completed its planned acquisition of European renewables developer NovEnergia Holding Company.
The company said the deal "diversifies its portfolio of renewable energy assets, significantly increasing its presence in Southern Europe" and delivers 669MW of installed capacity across 47 fully operating assets in Portugal, Italy, France, Spain, Poland and Bulgaria.
Pâris Mouratoglou, chairman of Total Eren, said the deal "represents a turning point in our history... It enables us to further diversify our portfolio and to substantially expand our presence in Europe."
The latest developments also come as Norway's $1 trillion Sovereign Wealth Fund followed its recent decision to ditch upstream oil and gas stocks with plans to drastically increase its investment in wind and solar projects.
Norway's government approved plans Friday that will allow the fund to invest in renewable energy projects that are not listed on stock markets, significantly increasing the pool of available clean energy investments for the influential fund.
Reports suggested the change meant the sum the fund can invest in renewable energy projects has doubled to $14 billion.
The fund also confirmed last week that it is to tighten the rules governing its investments in companies with coal assets, setting a new limit of 20 million tonnes of reserves.
Campaigners quite rightly will argue that the transformation of the fossil fuel industry is still proceeding far too slowly if it is to be brought into line with the goals of the Paris Agreement. Carbon offset schemes continue to face legitimate questions over whether they deliver sustainable net emissions reductions or simply enable "greenwash." Meanwhile, investment in low carbon infrastructure is still billions of dollars short of the level required to deliver a net zero emission economy by 2050. Despite these justified caveats, evidence that parts of the fossil fuel industry are at least starting to change is continuing to stack up.
This story first appeared on: