Anglo-Dutch Shell Plc says its focus is to accelerate the transition to net-zero emissions energy business by 2050, towards achieving the goals of the Paris Agreement.
This is contained in the oil and gas company’s 2021 Sustainability Report detailing five steps to managing its transition through energy provision, managing greenhouse gas (GHG) emissions, lower carbon electricity, fuelling mobility, and driving innovation.
Energy transition
The net-zero emissions by 2050, targets to reduce Shell’s carbon intensity (Net Carbon Footprint) of the energy products it sells.
This includes short-term targets of 3-4% by 2022, 6-8% by 2023 and 9-12% by 2024. It also includes medium- and long-term targets of 20% by 2030, 45% by 2035, and 100% by 2050.
Managing GHG emissions
In October 2021, the company announced an absolute emissions reduction target of 50% by 2030, compared with 2016 levels on a net basis.
By 2025, Shell expects to have kept the methane emissions intensity of Shell-operated assets to below 0.2%. In 2021, the company’s methane emissions intensity averaged 0.06% for assets with marketed gas and 0.01% for assets without marketed gas.
Shell’s methane emissions intensity ranged from below 0.01% to 1.5% in 2021 compared with 0.01% to 0.6% in 2020.
In terms of flaring, the company has committed to bringing forward the target to eliminate routine gas flaring from its upstream operated assets from 2030 to 2025.
Flaring of gas in Shell’s upstream and integrated gas businesses contributed around 7% to its overall direct greenhouse gas (GHG) emissions in 2021.
The projections also cover sectoral decarbonisation, which aims to produce about 2 million tonnes of sustainable aviation fuel (SAF) yearly by 2025, and increase by at least 10% by 2030.
The company’s aim is to use nature-based solutions to mitigate emissions of around 120 million tonnes of carbon dioxide (CO2) yearly by 2030, and last year, plans to invest about $100 million in nature-based solutions such as forests and wetlands that store carbon.
It also seeks to have access to an additional 25 million tonnes/year of carbon capture and storage (CCS) capacity by 2035, a move that cost it about $146 million last year.
Shell has been formally reporting on sustainability-related performance for 25 years, aimed at being transparent about activities that are important to investors, governments, and civil society.
Providing low-carbon electricity
Shell plans to increase its power sales to 560 terawatts yearly by 2030. Last year, it sold 251 TWh of power and cash capital expenditure in renewables and energy solutions amounted to $2.4 billion, and to increase investment to $3 billion this year.
For 2021, total installed capacity combined from onshore and offshore wind was 466 megawatts (MW) alternating current (MWac), with a further 838 MWac under construction.
From solar, installed power capacity was 734MW direct current (MWdc), with 1,484 MWdc under construction.
Fuelling mobility
In the review period about 9.1 billion litres of biofuels went into Shell’s petrol and diesel worldwide, which included 3.2 billion litres through its joint venture Raízen on an equity basis, but lower than the 9.5 billion litres recorded in 2020.
Also, for renewable natural gas, the company had planned to grow its European LNG refuelling stations to 50 sites for bioLNG distribution by the end of 2021. But it fell short, as it had 44 Shell-branded LNG refuelling stations across seven countries, but higher than the 26 stations it had in 2020.
In 2021, the company started production at the electrolyser Shell Energy and Chemicals Park Rheinland in Germany. The 10MW proton exchange membrane (PEM) electrolyser uses renewable energy to produce up to 1,300 tonnes of decarbonised hydrogen a year, which we are using to make lower-carbon fuels at the park.
Our Powering Progress strategy, which we launched in 2021, sets out how Shell can play a leading role in helping the world to reduce its carbon emissions.
ESG transparency
The 2021 Sustainability Report also contains Shell’s 2022 Industry Associations Climate Review Update, and its 2021 Payments to Governments Report.
Shell has been formally reporting on sustainability-related performance for 25 years, aimed at being transparent about activities that are important to investors, governments, and civil society.
The 2021 Shell Sustainability Report outlines the progress towards many of its Powering Progress strategic ambitions, and shares related social, safety and environmental performance data.
Shell’s CEO, Ben van Beurden, in his introduction to the report, said: “Our Powering Progress strategy, which we launched in 2021, sets out how Shell can play a leading role in helping the world to reduce its carbon emissions.
“At the heart of our strategy lies our own target to become a net-zero emissions energy business by 2050, in step with society’s progress in achieving the Paris climate goals. In this our 25th Sustainability Report, we share how we are working towards our Powering Progress goals.”
Shell also published its 2022 Industry Associations Climate Review Update, which provides a progress update on actions taken over the past year to address differences in climate-related positions with industry associations where the company identified misalignment.
It also provides a summary of how much Shell paid to 36 associations in 2021.
In addition, Shell published its 2021 Payments to Governments Report covering countries where it has exploration and production (E&P) activities.
This report details payments in 25 countries and was prepared in accordance with the UK’s The Reports on Payments to Governments Regulations 2014 (as amended in December 2015).
