Energy transition strategy
Powering Progress is our strategy to generate more value with less emissions for the benefit of our shareholders, customers and wider society as we work to become a net-zero emissions energy business by 2050. Our purpose -- to provide more and cleaner energy solutions – drives our strategy.
Our strategy supports a balanced energy transition by responsibly delivering the oil and gas people need today, while helping to build the energy system of the future. As we implement our strategy, we are becoming a multi-energy business offering our customers more and cleaner energy solutions. Our energy transition plans cover all our businesses. They aim to reduce emissions from our operations, and help our customers transition to cost-competitive and cleaner energy.
We are reducing emissions from our operations, and helping our customers move to cost-competitive and cleaner energy. Our energy transition plans cover all our businesses:
- Integrated Gas – Growing our world-leading LNG business with lower carbon intensity.
- Upstream – Cutting emissions from oil and gas production, while keeping oil production stable.
- Downstream, Renewables and Energy Solutions – Transforming our businesses to offer more low-carbon solutions, while reducing sales of oil products.
See the "Our strategy" section.
Board holds Strategy Days in Canada and visits LNG project
In June 2023, the Board held its Strategy Days in Canada, where members discussed the key elements of Shell's energy transition strategy with the Executive Committee. Board members also visited LNG Canada (Shell interest 40%, non-operated), which is being built on the west coast of Canada. They met with employees, customers, suppliers and other key stakeholders, including leaders of the Haisla Nation in the nearby community of Kitimat, British Columbia.
LNG Canada is expected to start production in the middle of this decade. It is designed to have the lowest carbon intensity of any large liquefaction facility currently operating anywhere in the world ― about 60% lower than the average facility today and 35% lower than the best-performing facility.
Our strategy aims to support the more ambitious goal of the Paris Agreement
Tackling climate change is an urgent challenge. It requires a fundamental transformation of the global economy and the energy system so that society stops adding to the total amount of greenhouse gases in the atmosphere, achieving what is known as net-zero emissions. That is why Shell has set a target to become a net-zero emissions energy business by 2050.
The Paris Agreement aims to strengthen the global response to the threat of climate change by "holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels". Shell supports the more ambitious goal of the Paris Agreement, which is to limit the rise in global average temperature this century to 1.5°C above pre-industrial levels.
To help us get there, we have set short-, medium- and long-term targets to reduce the carbon intensity of the energy products we sell, measured using our net carbon intensity metric. We believe these targets are aligned with a 1.5°C pathway derived from scenarios developed for the IPCCs Sixth Assessment Report (AR6). For more information see "Setting targets for NCI".
Becoming a net-zero emissions energy business means reducing emissions from our operations, and from the fuels and other energy products, such as electricity, that we sell to our customers. It also means capturing and storing any remaining emissions using technology, protecting natural carbon sinks, and providing high-quality carbon credits to our customers to compensate for hard-to-abate emissions.
An increasing number of countries and companies have announced targets to achieve net-zero emissions by the middle of the century, and we are starting to see some changes in the demand and supply of energy. However, achieving the 1.5°C goal will be challenging and requires unprecedented global collaboration. The pace of change will also vary around the world.
