By Alex Nevill, General Manager, Nature-based Solutions, Shell on Mar 17, 2022
As companies act on the energy transition, demand for carbon offsets generated from nature-based solutions (NBS) is rising.1 NBS include projects which protect, enhance or restore natural ecosystems to avoid carbon dioxide (CO2) emissions or absorb CO2 from the atmosphere. They can lead to the generation and use of carbon credits by companies to offset emissions.
To gain insights on the rising discussion around nature-based climate solutions, we spoke with Alex Nevill, General Manager, Nature-based Solutions, Shell. In this interview, he shares how nature-based climate solutions are being incorporated into Shell and third-party net-zero strategies.
On 22 March 2022, Alex will be joined by Andy Gosse, President, Shell Catalysts & Technologies and Flora Ji, Shell Global Vice President, Nature-Based Solutions for the next webinar in the Make Every Molecule Matter series on “Building nature-based solutions into your net-zero strategy”. They will expound upon the topic and answer questions from participants about the role of NBS through the energy transition.
1. Why has interest around nature-based climate solutions increased over the past year?
Alex Nevill: Nature-based solutions are getting a lot of coverage for a number of reasons. First, the transition to net-zero carbon future is a huge challenge where technology will be key but where nature also has a vital role to play. Nature is a proven solution – it has been capturing and storing carbon for millennia – it is available at scale today and is affordable compared to some of the other solutions. If you invest well and wisely, you not only get the climate benefit, but you also get benefits of improved biodiversity and community livelihoods, which are issues that as a global society, we are also grappling with. There are scientific papers that report on nature’s capacity to deliver a third of what’s required to fulfill the Paris Agreement.2
The quality of these projects is absolutely fundamental to the success of nature-based solutions as a credible solution to climate change. A carbon credit is essentially an instrument of trust. When we sell a carbon credit to a customer, what we’re saying is that it represents one tonne of CO2 avoided or captured. Projects need to have all the systems in place to deliver on that trust.
At Shell, we’ve been very clear from the outset about the need for quality and published a paper on ensuring high quality nature-based carbon credits last year. We use third-party certification standards and run our own checks to ensure that the carbon accounting is robust and that there are net-positive impacts for biodiversity or the local communities.
2. How does Shell Catalysts & Technologies work with customers on building nature-based climate solutions into their carbon management journeys?
Offsets are part of the range of solutions within a decarbonisation hierarchy of “avoid, reduce and then mitigate”. Shell takes a customer perspective and offers a mix of solutions because there is no one solution that addresses all customer needs and circumstances.
To illustrate this with an example, a warehousing-and-freight company may come to Shell saying that they are looking to reduce their carbon footprint in order to be their customers’ preferred supplier. We can look at the organisation’s carbon footprint and support strategies to:
- Avoid – Their warehouse is consuming power; energy efficiency will be important and we can provide energy from a renewable source. For their light-duty vehicles, the company may switch to electric vehicles that can be recharged through Shell charging points.
- Reduce – If the switch to electric vehicles is not practical, we can help to reduce fleet emissions through advanced biofuels or natural gas.
- Mitigate – For their heavy-duty trucks, there may not be a commercially viable solution today, but while they continue to use gasoline or diesel, we can offer carbon credits to offset the emissions from their fleet.
Ultimately, technology will accelerate the energy transition. We see that around us today in the growth of wind and solar power and electric vehicles which have come down in price and are being increasingly deployed over time. There is progress being made in deploying hydrogen for different end-uses. But these technologies and solutions will take time to deploy at scale across all countries and consumers.
There are other parts of the energy economy where low-carbon solutions are simply not available, either because the technology doesn’t exist, or it’s still too expensive to be deployed at scale. Sustainable aviation fuel is a good example. Similarly, we do not yet have a low-carbon solutions at scale for industries like cement or steel. This is where carbon credits can also play a transitionary role.
That doesn’t stop the need for research and development in developing those low-carbon solutions, any more than it stops the need for their deployment. This is not an “either-or” dilemma, it’s “and-and” – we need everything here.
3. What are some topics you are interested in discussing with participants?
We’d like to highlight the benefits of nature-based solutions, including biodiversity and social impact, as well as emphasise the need for quality. I can also share insights into how we are investing to build a credible portfolio.
Lastly, it would be good to address the so-called “green-washing” point and highlight NBS’ role and contribution within a portfolio of the solutions needed to tackle climate change.
1 Max Tingyao Lin, “COP26: Nature-based solutions offset trading on the rise, as is concern,” IHS Markit, 9 November 2021, https://cleanenergynews.ihsmarkit.com/research-analysis/cop26-naturebased-solutions-offset-trading-on-the-rise-as-is-c.html.
2 “Nature-Based Solutions to Address Climate Change,” United Nations Global Compact, accessed 5 January 2022, https://www.unglobalcompact.org/take-action/events/climate-action-summit-2019/nature-based-solutions#:~:text=Nature%2DBased%20Solutions%20to%20Address%20Climate%20Change,-The%20Nature%20Based&text=Authoritative%20research%20indicates%20that%20Nature,gigatons%20of%20CO2%20per%20year.