Shell Energy Transition Report
How are we driving our business strategy in the context of climate-related risks and opportunities? This report helps answer questions from shareholders, governments and non-governmental organisations about what the energy transition means for Shell.
Shell and the energy transition
The Paris Agreement has sent a signal around the world. A new energy system is emerging. It will unfold over decades, moving at different paces in different places. The transition offers challenges, opportunities and tough choices for governments, businesses and customers.
The Shell Energy Transition Report sets out why we believe Shell will be resilient to expected changes in the energy system and how our strategy should allow us to thrive as the world transitions to lower-carbon energy. As well as describing Shell’s understanding of the transition, it provides information about our medium-term resilience, and examples of how we are already active in many of the growth areas that will drive our continued success.
For Shell, this means that we will continue to sell the oil and gas that society needs, while preparing our portfolio to move into lower-carbon energy, when this makes commercial sense. We believe Shell’s strategy, portfolio and strong financial framework give us the ability to thrive through potential changes to the energy system to 2030.
In the medium-term, Shell will grow its business in areas it expects to be important in the energy transition, while reducing costs and improving our CO2-intensity performance. We are expanding in the power market as we expect the energy system to increasingly electrify. We are also adjusting our businesses to meet changing demand in different countries. This includes investments in areas such as wind generation in the Netherlands, supplying power to retail customers in the UK and offering hydrogen and electric-car charging in European markets.
Longer term, there is great uncertainty, but we believe Shell’s strategic flexibility will allow us to adapt in step with society. The Shell Energy Transition Report describes Shell’s intent to move in step with society towards a lower-carbon future. It describes our previously-stated ambition to halve the Net Carbon Footprint of the energy we sell by 2050.
The Shell Energy Transition Report responds to society’s request for greater transparency on climate-related risks and, as such, is our principal response to recommendations of the Task Force for Climate-related Financial Disclosures (TCFD).
The TCFD is a global initiative to encourage companies across all sectors to assess the risks and opportunities presented by climate change. It recommends that companies disclose information in four areas: governance; strategy; risk management; and targets and metrics. Shell supports the work and objectives of TCFD. In this report we provide the information investors need to assess our strategy and performance.
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