Shell presents energy transition strategy

In: Corporate

Shell has issued its Energy Transition Strategy publication, which will be put to shareholders for an advisory vote at the company’s Annual General Meeting on May 18, 2021. This is the first time that an energy company has asked shareholders to vote on its energy transition strategy.

“As we transform our business, it is more important than ever for shareholders to understand and support our approach,”
said Royal Dutch Shell's Chief Executive Officer, Ben van Beurden, in his introduction to the publication. “We are asking our shareholders to vote for an energy transition strategy that is designed to bring our energy products, our services, and our investments in line with the goal of the Paris Agreement and the global drive to combat climate change.”

This publication sets out the company’s target to achieve net-zero emissions by 2050, in step with society’s progress towards the goal of the Paris Agreement on climate change. It also describes Shell’s short- and medium-term climate targets, customer focussed decarbonisation strategy, capital allocation and approach to climate-related policy and advocacy.

The decision to seek an advisory vote was announced in February as part of Shell’s Powering Progress strategy, which aims to accelerate the transition of the company’s business to net-zero emissions, in step with society. It follows continuing engagement with shareholders, including with Climate Action 100+ which represents investors with assets of around $54 trillion.

The vote is purely advisory and will not be binding. Shell’s Board and Executive Committee remain responsible and accountable for setting and approving Shell’s energy transition strategy.

Shell will publish an update to its Energy Transition Strategy publication every three years until 2050. Every year, starting in 2022, it will also seek an advisory vote on its progress towards its plans and targets.

Offshore wind is a key growth area for Shell as it looks to generate cleaner power for its customers. Shell entered the offshore wind business in 2000 as part of a consortium that installed the first offshore wind turbine in UK waters. The company owns interest in the
Egmond aan Zee and Blauwwind offshore wind farms currently operating off the Dutch coast. It is also supporting the development of the subsidy-free Hollandse Kust Noord project through the CrossWind consortium. Shell is a 79.9% shareholder in the consortium.

In the US, Shell is a 50% shareholder in
Atlantic Shores in New Jersey that is working to develop an offshore lease area capable of generating 2.5 GW of power. Shell is also a 50% shareholder in the Mayflower consortium, which is working to develop a lease area off the coast of Massachusetts, USA. That site will have the potential to generate 1.6GW of power that will power more than 680,000 US homes. In 2019, the Mayflower Wind project was chosen to supply 804 MW of offshore wind capacity to Massachusetts, with the expected start-up in 2025.

Shell is also investing floating wind energy. It is a major shareholder in the Tetraspar Demo - a new floating turbine foundation, that offers leaner manufacturing, assembly and installation leading to lower costs. The structure will be tested in Norwegian waters in 2021.

Shell acquired Eolfi in 2019, a French renewable energies developer specialising in floating offshore wind projects. The acquisition added the
Groix & Belle-Île pilot wind farm to its portfolio, which is being developed off the coast of Brittany with an expected installed capacity of 28.5 MWonce complete.

Shell has a entered a joint development agreement with floating wind specialist CoensHexicon for a project in Ulsan province, Korea. In 2020 it deployed a FLiDAR (floating light detection and ranging) system to assess the feasibility for floating wind in South Korea.

In Ireland Shell owns a 51% share in the 300 MW
Emerald floating wind farm which is in early-stage development.

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