Shell shakes up climate targets, sparking backlash

UK oil and gas giant Shell on Thursday watered down key targets on cutting carbon emissions, sparking anger from climate campaigners, but kept its pledge for net zero by 2050.

The London-listed group, which is investing heavily in renewables, revealed the news in an energy transition update published alongside its annual report.

Shell said it had diluted climate targets, including on "net carbon intensity", a measurement of emissions produced by each unit of energy sold by Shell.

The group said net carbon intensity would be cut 15-20 percent by 2030 compared to 2016 levels.

That marked a dilution from its previous 20-percent target owing to a slowdown in electricity sales.

For the first time, Shell gave a target on curbing customer emissions from the use of its oil products -- so-called Scope 3 emissions -- with a reduction of 15-20 percent by 2030 compared with 2021.

"Achieving this ambition will mean reducing sales of oil products, such as petrol and diesel, as we support customers as they move to electric mobility and lower-carbon fuels," Shell said.

The company maintained its plan to halve emissions generated from its own operations -- Scope 1 and 2 activities -- by 2030 compared with 2016.

It achieved 60 percent of this target by the end of 2023.

"Today, the world must meet growing demand for energy while tackling the urgent challenge of climate change," Shell chief executive Wael Sawan said in the update.

It confirmed plans to invest between $10-15 billion by the end of 2025 in low-carbon energy.

It added that it would drop a plan to slash net carbon intensity by 45 percent by 2035 due to "uncertainty in the pace of change in the energy transition". However, it still targets a 100-percent reduction by 2050.

'Shell backtracks'

Green campaigners lashed out at the company's latest stance, arguing it was counter to the 2015 Paris climate accord, which seeks to limit the increase in average global temperatures to 1.5 degrees Celsius above pre-industrial levels.

"Shell backtracks on climate targets," said environmental activist shareholders' group Follow This.

It said the company was betting "on the failure of the Paris climate agreement".

"The company wants to stay in fossil fuels as long as possible," it warned, declaring that the move "not only endangers the global economy by exacerbating the climate crisis but also puts the company's future at risk".

However, Shell insisted it sought a "balanced and orderly transition away from fossil fuels to low-carbon energy solutions to maintain secure and affordable energy supplies".

The group also revealed that Sawan earned £8 million ($10.25 million) in salary and bonuses in 2023, his first year as CEO.

That sparked additional fury at a time when millions of Britons are still struggling under a cost-of-living crisis sparked by elevated domestic energy bills.

"Shell's CEO pay packet is a bitter pill to swallow for the millions of workers living with the high costs of energy," said Jonathan Noronha-Gant, senior fossil fuels campaigner at pressure group Global Witness.