Royal Dutch Shell May Miss Green Targets

Oil giant Royal Dutch Shell may fail to reach key green targets by the end of this year, based on its current investment trajectory.

The company had planned to invest up to a total of $6bn in green energy projects by the end of 2020.

Progress towards this goal has been slow, however, prompting concerns that oil companies are not working hard enough to help alleviate the current climate crisis.

Since setting up its ‘new energies’ division in 2016, an estimated $2bn has already been invested by the company into low-carbon energy and electricity generation. With only 12 month’s left, the Anglo-Dutch company would have to invest another $2-4bn or risk failing to meet its own target of investing between $4bn and $6bn between 2016 and 2020.

Its investors were told in 2017 that $1bn to $2bn a year would be spent on developing a clean energy business until the end of 2020. This was up from $1bn a year in a previous plan for the same time period.

Shell should have invested $6bn in green energy by the end of this year, but is currently on track to achieve just a third of this total, despite the company’s guidance advising that half of the entire total should have been spent up until the end of 2019.

In the same four-year time period, the company spent in excess of $120bn on the development of fossil fuel projects, and set out a plan to increase its total spending yearly spending to $30bn in the early 2020s.

Despite having assigned only 10% of its budget to ‘new energies’, Shell’s green energy goals are some of the most ambitious in the entire oil industry. The company is considered a leader when it comes to the climate, even though only a small portion of its total spending is on clean energies.

Norwegian consultancy, Rystad Energy, produced a report that showed that the five largest oil companies in Europe spent only $5.5bn on renewable energy projects to date, despite their combined budget being $90bn for 2019 alone. These companies included Shell, along with Total, Eni, BP, and Equinor.

Executive director of Oil Change International, Stephen Kretzmann, said that oil executives “trumpet their relatively tiny investments in renewables” whilst continuing to “pour more fuel on the fire of global warming every day”.

“It used to be the case that some people believed that an oil company that invested even only a small portion of their resources in renewable energy was worthy of praise… because it makes us feel better to believe that the people who run these powerful companies get it”, he said.