Oil major Royal Dutch Shell will seek ways to accelerate its energy transition strategy and deepen carbon emission cuts, after a landmark Dutch court ruling last month, said the company’s CEO Ben van Beurden, Wednesday.
In a historic decision on 26 May, the District Court in The Hague ruled that by 2030 Shell must reduce its net carbon emissions by 45%, compared to its 2019 level, not just in the Netherlands, but worldwide, marking the first time a judge has held a corporation liable for causing climate change.
Since 2020, the company has already set a target to become a net-zero emissions energy business by 2050, in line with Paris Agreement goal (find a roadmap here), but the verdict finds the company’s sustainability policy as insufficiently “concrete” and accelerates its existing strategy.
For Shell, this ruling does not mean a change, but rather an acceleration of our strategy. We have a clear target to become a net-zero emissions business by 2050, in step with society’s progress towards achieving the goal of the Paris Agreement. We have set rigorous, short-term reduction targets along the way to make sure we achieve net zero,
…said Mr. Ben van Beurden in a Linkedin post, adding that the oil major will now seek ways to reduce emissions even further in a way that remains profitable. This is likely to mean taking some “bold but measured steps over the coming years”.
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In addition, he stressed that the answer to climate change will be a greater collaboration between governments, companies, and customers to allow companies build up low-carbon energy businesses, rather than ordering one energy company to reduce its emissions.
Imagine Shell decided to stop selling petrol and diesel today. This would certainly cut Shell’s carbon emissions. But it would not help the world one bit. Demand for fuel would not change,
…he said.
The court has also said its decision applies immediately and should not be suspended pending an appeal. Analysts have said the ruling could lead to a 12% decline in the company’s energy output, including a sharp drop in oil and gas sales, according to Reuters.
We may disagree with this order, but we will continue to embrace the leading role we must play in helping to develop a low-carbon energy system,
…Mr. van Beurden concluded.
