CLEAN ENERGY SOLUTIONS

SHELL ENERGY EUROPE

THE WORLD NEEDS MORE AND CLEANER ENERGYGlobal energy challenge

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The world will need much more energy to power homes and fuel transport for a growing population with rising living standards. But, to tackle climate change, energy must increasingly come from lower-carbon sources. 

The world today is dynamic and fast-changing, and for many, energy is a defining feature

Lives and livelihoods, economies and communities depend on convenient, reliable and affordable energy to thrive

As the global population increases and incomes rise, demand for energy will grow

Meanwhile the need to address stresses on the environment – especially climate change – has never been more important

Changes need to happen across all sectors of economic activity especially in power, transport, buildings and industry – four major sectors where energy is consumed, and that produce significant energy-related CO2 emissions.

Urgency, realism, innovation and collaboration are key. The global energy transition, therefore, will span decades and require unprecedented collaboration between policy-makers, leaders from business and non-governmental organisations, and consumers.

To tackle climate change, energy must increasingly come from lower-carbon sources.

GETTING TO NET-ZERO EMISSIONS The only way to go

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“ Reducing emissions to net-zero – lowering them to the point at which the world is no longer adding to the stock of greenhouse gases in the atmosphere – is the only way to go.” Ben van Beurden Shell CEO July 2019

The Paris Agreement has sent a signal around the world: climate change is a serious issue that governments, businesses and society are determined to address. The Paris Agreement set a goal of keeping the rise in the global average temperature well below 2°C, and Shell strongly supports it.

By 2070, there is the potential for a very different energy system to emerge. To achieve the goal of the Paris Agreement, Shell believes the world is likely to have to stop adding to the stock of greenhouse gases in the atmosphere by 2070. This is a state known as net-zero emissions.

But by 2070, the number of people on the planet will have risen by around a third from today to more than 10 billion, and people’s living standards will have improved. Together, these trends mean the world will use more and more energy. Even with a huge improvement in energy efficiency, the world is likely to be using 50% more energy by 2070, compared to today.

CHANGING WORLD: MOVING TO A LOWER-CARBON ENERGY SYSTEM

Population increases by around a third

Energy demand increases by around a third

7.6 BILLION

32Gt (net CO2e emissions)

9.8 BILLION

18.4Gt (net CO2e emissions)

CO2 emissions need to reduce by around a half

2017 2050

SHELL’S ROLE IN THE TRANSITION TO A LOW-CARBON WORLD Committed to playing our part

SHELL’S NET CARBON FOOTPRINT AMBITION Thrive in the energy transition

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We agree that action is needed now on climate change, so we fully support the Paris Agreement and the need for society to transition to a lower-carbon future.

We’re committed to playing our part, by addressing our own emissions and helping customers to reduce theirs. As the energy system evolves, so will our business, to provide the mix of products that our customers need. We are reshaping our portfolio by growing our Integrated Gas, Chemicals, and New Energies businesses.

We have already invested billions of dollars in a range of low-carbon technologies, from biofuels, hydrogen and wind power, to electric vehicle charging and smart energy storage solutions. But addressing a challenge as big as climate change requires a truly collaborative, society-wide approach.

We believe that smart policy from government, supported by inclusive action from businesses like ours and from civil society, is the best way to reach solutions and drive progress. We want to work together to #MakeTheFuture energy system one that enables a world of opportunities – for individuals, communities, countries and companies – while helping to protect the planet.

We intend to cut the carbon intensity of the energy products we sell, in step with society as it moves towards the goal of the Paris Agreement.

That means fewer greenhouse gases emitted on average with each unit of energy we sell – by around 20% by 2035 and by around half by 2050*. And that includes all the emissions from the life cycle of each of our energy products:

from production to processing, to transportation and through to final use. This is what we call our Net Carbon Footprint ambition.

In 2019, we set a three-year target to reduce our Net Carbon Footprint by 2% to 3%, compared to 2016

Our executives’ pay is linked to this target

* Net Carbon Footprint measured on an aggregate “well to wheel” or “well to wire” basis, from production through to consumption, on grams of CO2 equivalent per megajoule of energy products consumed; chemicals + lubricants products are excluded. Carbon Footprint of the energy system is modelled using Shell methodology aggregating lifecycle emissions of energy products on a fossil equivalence basis. The methodology will be further reviewed and validated in collaboration with external experts.

BASELINE OPERATIONALEFFICIENCY NATURAL

GAS SHIFT RENEWABLEPOWER

BIOFUELSELECTRICMOBILITY

CCS NATURALSINKS

MEETING THE AMBITION: POTENTIAL SOLUTIONS TO ACHIEVE OUR AMBITION

EXISTING EXAMPLES...

FLARE REDUCTION

INCREASED LNG

WIND POWER

RAÍZEN BIOFUELS

SHELL RECHARGE AND NEW MOTION

QUEST CCS

NATURE-BASED SOLUTIONS

DEVELOPING OUR GAS BUSINESS

ADVANCING CCS

ADVOCATE CO2 PRICING POLICIES

R&D IN LOW-CARBON TECHNOLOGIES

SCENARIOS THOUGHT LEADERSHIP

SHELL VENTURES

COALITIONS AND GOV’T ADVISORY

NEW FUELS RENEWABLE POWER

NO SINGLE SOLUTION, BUT MANY The three-part answer: avoid, reduce and compensate

SHELL ENERGY EUROPE, YOUR PARTNER TO DELIVER CLEAN ENERGY SOLUTIONS

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AVOID EMISSIONSMaximising the role of renewables in the energy transition

We develop wind and solar projects, produce power from existing assets and manage renewable power offtakes to meet our customers’ energy needs.

Some of Shell’s recent investments:

Borssele 3 & 4 wind project in the Netherlands.

US offshore wind projects.

US solar company Silicon Ranch Corp.

Cleantech Solar in Singapore.

We are improving and expanding our renewables offering to customers, starting from renewable certificates through to corporate power purchase agreements with additionality.

COMPENSATE EMISSIONSOffering innovative solutions for emissions that cannot be avoided or reduced

Customers can purchase credits from high-quality emission reduction projects to compensate any unavoidable emissions.

For unavoidable emissions from combustion of natural gas, we offer a bespoke solution to bundle gas supply with nature-based carbon credits.

REDUCE EMISSIONSPromoting the use of natural gas as the cleanest burning hydrocarbon

To further accelerate decarbonisation of the gas system, we offer various renewable gas solutions including biomethane tailored to customer needs.

We have one of the largest natural gas trading operations in the world. This allows us to connect buyers and sellers and provide reliable and flexible gas supply to our customers.

Natural gas plays an increasingly important role in sectors of the economy that cannot be easily electrified. It helps lower emissions and improves air quality when it replaces coal and diesel. Gas is also an ideal partner for renewable energy sources, providing critical support in matching supply and demand.CO2

CO2 CO2

AVOID EMISSIONS

Renewable power Renewable energy certificates

Corporate power purchase agreements

REDUCE EMISSIONS

Renewable gas

COMPENSATE EMISSIONS

Voluntary carbon credits Natural gas with voluntary carbon offsets

There is no single solution to keep the rise in the global average temperature well below 2°C. Many different solutions are urgently needed for a successful transition to a low-carbon world.

Shell Energy Europe provides you with a range of clean energy solutions that can help you meet your decarbonisation goals. We tailor solutions that aim to avoid, reduce or compensate for the emissions of your business.

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With our renewable power offering, you can be active in reducing emissions and showcase your commitment to tackling climate change.

Renewable energy certificates document that the energy you consume comes from renewable sources. These certificates provide information on the asset type, location and production date of renewable power and thus make it possible to track and trade renewable electricity.

Renewable power is a bundled electricity supply with the renewable energy certificate of your choice.

RENEWABLE POWERAll-in-one renewable energy solution

Shell Energy Europe, an established power trader and licensed supplier with 15 years of trading experience, can offer you renewable power products.

We can source and supply electricity at competitive prices and give you the opportunity to fix and unfix your commodity price before your power is delivered.

You will receive a bespoke renewable power contract and access your invoice and power consumption on the Shell Energy Customer Portal.

We will guarantee that the volume of your actual power consumption is the same as the retired renewable energy certificates and provide you with the cancellation statement.

We will take care of all the administrative procedures on your behalf, making it a hassle-free product.

Globally, we manage 5,000+ MW of renewable power assets, including hydro, wind and solar.

CO2 CO2AVOID EMISSIONS

AVOID EMISSIONS

RENEWABLE ENERGY CERTIFICATES An effective tool to avoid your CO2 emissions

How it works:

ENERGYENERGY

ENERGY

CERTIFICATES

Shell Energy Europe offers you a variety of renewable energy certificates, which can be used to meet your renewable energy commitments. These include European Guarantees of Origin (GoOs), UK Renewable Obligation Certificates (ROCs) and UK Renewable Energy Guarantees of Origin (REGOs).

We can source a variety of certificates according to your needs, from the most basic ones to more advanced eco-labels with additional sustainability features.

We can take care of all the administration around your GoOs, ensuring that they are registered, tracked and retired on your behalf in the national registry and providing you with the cancellation statement.

In the UK, we can maintain 100% renewable fuel mix disclosure by presenting renewable energy certificates to the regulator.

This is a flexible product, enabling you to source renewable energy on a pan-European or global scale where alternative renewable power options are not available.

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GENERATION FROM NATURAL GAS

CUSTOMERS TRADING GENERATIONTRANSMISSION AND DISTRIBUTIONPOWER PRODUCTS

I N C R E A S I N G E X P E C T E D R E T U R N S T H R O U G H I N T E G R A T I O N

SOLAR

GIANT STORAGE SYSTEMS

ELECTRIC VEHICLE (EV) CHARGING

MOBILITY

INDUSTRIAL

COMMERCIAL

RESIDENTIAL

CONNECTED HOME STORAGE

SMART HOME

COMMERCIAL AND INDUSTRIAL ON-SITE

SOLUTIONS

MANAGE CUSTOMER ELECTRICITY USE AND

PRODUCTIONWIND

TRADING AND OPTIMISATION

TRANSMISSION AND DISTRIBUTION

BUILDING AN INTEGRATED POWER BUSINESS

We are ready to meet our customers’ evolving energy needsThe changing energy system is a commercial opportunity for Shell. We are expanding our existing electricity businesses and moving into new areas. We are becoming a key player thanks to the combination of our power trading capability, our experience dealing with governments and regulators across the world, and the strength of the Shell brand.

ELECTRICITY

CORPORATE POWER PURCHASE AGREEMENTS The emerging preference for buying renewable power

GROWING OUR RENEWABLE FOOTPRINT, GLOBALLY

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AVOID EMISSIONS

RENEWABLE PROJECT

CORPORATE

CUSTOMERS AND SOCIETY

PRICE-RISK MANAGEMENT AND BALANCING

RENEWABLE ENERGY CERTIFICATES, WHEN AVAILABLE

How it works:PROFILE

ELECTRICITY

ELECTRICITY

NORTH AMERICA

Shell Energy North America manages 1,400 MW of hydro-electric capacity; with 1,400 GW of solar capacity operated and contracted; and 2,900 MW of wind power capacity in development and installed.

Investment in Silicon Ranch Corp, a leading US developer, owner and operator of solar assets.

Since 2001, development and co-ownership of five onshore wind projects, from California to West Virginia.

New Jersey offshore wind joint venture with EDF Renewables North America.

SOUTHEAST ASIA AND INDIA

Solar investment in Cleantech Solar (49%), a rapidly growing Singapore-based developer with more than 120 solar power projects across Southeast Asia and India.

EUROPE

Power purchase agreements for 1,000+ MW capacity from wind, solar, biomass, co-generation and hydro in the Netherlands, Italy, Spain and the UK.

NETHERLANDS Part of the consortium developing the Borssele 3 and 4 wind farms (total installed capacity: 731.5 MW).

Part of the joint venture that owns the Edmond aan Zee offshore wind farm (total installed capacity: 108 MW).

ITALYPower purchase agreement for 385 MW total capacity from solar and wind.

SPAINPower purchase agreements for 337 MW total capacity from biogas, solar, hydro, wind and co-generation.

UNITED KINGDOMPower purchase agreements for 261 MW total capacity from wind and solar.

Shell Energy Europe can partner with you for the most suitable corporate power purchase agreement (corporate PPA) for your company.

You can access a fast-growing global portfolio of renewable power supplies from assets that we either own, are in development or, sometimes, are owned by third parties.

We can handle the power operations and balancing for you.

You can fix and manage the power price along the tenure of the PPA.

We can publicise together the PPA and increase the environmental attributes of your brand.

Corporate PPAs enable you to contribute to the development of new renewable assets.

Shell produces electricity from existing projects, develops wind and solar projects and buys more renewable power from other producers – via power purchase agreements (PPAs) – to meet your energy needs.

A corporate power purchase agreement is a long-term agreement that enables a corporation to purchase its electricity from a specific renewable technology.

EXAMPLES OF SHELL’S RENEWABLE PORTFOLIO:

Updated at Q4 2019

Existing project Under developmentKEY

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CO2

REDUCE EMISSIONS

COMPENSATE EMISSIONS

RENEWABLE GASProviding more and cleaner gas

VOLUNTARY CARBON CREDITSHelping you to achieve your decarbonisation targets

MANURE AND SLURRY

FEED

STO

CK

FOOD ANDAMENITY WASTE

CROPS ANDRESIDUES

ANAEROBIC DIGESTER

POWER

GAS GRID

TRANSPORT FUELS

HEAT

DIGESTATECAPTURE

CO2

BIOGAS UPGRADEDTO BIOMETHANE

How biomethane works:

Shell Energy Europe leverages our expertise as an established natural gas trader and supplier to offer renewable gas products, including biomethane which can help you achieve your decarbonisation goals.

Depending on what is most important for your business we have a biomethane strategy which can work for you from supplying certificates only, to gas with transport and corresponding certificates.

We can offer you biomethane without the need to alter your physical infrastructure or gas purchase agreements.

Shell works with environmental projects around the world that help reduce greenhouse gas emissions while improving the livelihoods of local communities and preserving biodiversity and wildlife. These projects generate carbon credits that can be used to compensate for your company’s emissions.

In January 2020 Shell announced an important step towards decarbonising heavy-duty road transport in Germany by extending its German LNG station network to 35-40 sites and supplying it with carbon-neutral LNG fuel. The initiative includes sourcing biomethane produced from wet manure, agricultural or municipal waste, building gas liquefaction capacity and the distribution of carbon neutral LNG through Shell’s LNG station network.

Biomethane can help you achieve complete decarbonisation without the need for additional capital investment.

1 CARBON CREDIT REPRESENTS THE AVOIDANCE OR REMOVAL OF 1 TONNE OF CO₂

WHEN CO₂ EMISSIONS ARE HARD TO ABATE...

...THEY CAN BE COMPENSATED THROUGH PROJECTS IN THE SHELL GLOBAL CARBON CREDIT PORTFOLIO...

...THAT ARE INDEPENDENTLY VERIFIED TO CAPTURE OR REDUCE CO₂ EMISSIONS AND CREATE CARBON CREDITS...

...WHICH CAN BE RETIRED TO DEMONSTRATE AN AMOUNT OF CO₂ EMISSIONS HAVE BEEN COMPENSATED FOR.

How it works: Compensating for your CO₂ emissions

Voluntary carbon credits are a recognised mechanism that allows individuals and companies to invest in environmental projects that contribute to reducing the amount of CO₂ in the atmosphere. Some offer broader value to society, including improved social livelihoods and biodiversity, clean water and air quality while balancing peoples’ carbon footprints.

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COMPENSATE EMISSIONS

NORTH AMERICAA GREENTREES (USA)

B CONSERVATION COAST (GUATEMALA)

SOUTH AMERICAC CORDILLERA AZUL

(PERU)

D NII KANITI (PERU)

E TAMBOPATA (PERU)

AFRICAF FORM GHANA (GHANA)

G MAI NDOMBE (DR OF CONGO)

H BOREHOLES (MALAWI)

I TIST (KENYA)

J KASIGAU (KENYA)

ASIA-PACIFICK TIST (INDIA)

L ENVIROFIT (INDIA)

M XINIJANG MAKIT (CHINA)

N QINGHAI (CHINA)

O XINING (CHINA)

P HAIDONG (CHINA)

Q PUZHEN (CHINA)

R XIGUAN (CHINA)

S SAIHANBA (CHINA)

T CARDAMOM (CAMBODIA)

U KATINGAN (INDONESIA)

A

B

CD

E

JI

F

GU

T

K

L

H

M

RQ

SN

OP

SHELL’S GLOBAL PORTFOLIO OF VOLUNTARY EMISSION REDUCTION PROJECTS

Criteria used to determine a project’s suitability for inclusion in the Shell Global Offset Portfolio.

www.shell.com/environmentalproducts

PROJECT SELECTION

SHELL’S GLOBAL OFFSET PORTFOLIO

PROJECT TYPES

Reforestation Avoided forest conversion Natural forest management Avoided woodfuel Fire management

FORESTS CLIMATE

Peat restoration and protection

WETLANDS NATURE

Wind

RENEWABLES PEOPLE

Cook stoves Clean water provision and sanitation

HOUSEHOLD DEVICES

ECONOMY

Adherence to approved carbon standards

Environmental impact beyond CO₂ reduction

Social benefit to the local community

Reputation and experience of project developer

Government support for project

ALIGNMENT WITH UN SUSTAINABLE DEVELOPMENT GOALS (SDGs)

Climate mitigation Climate adaption

Biodiversity Clean air and water Wildlife protection

Job creation Medicine and health

Food security Energy security Water security

€

CONSERVATION

AFFORESTATION

REFORESTATION

HOUSEHOLD DEVICES

Qinghai Afforestation Project, China.

Saihanba Mechanical Forestry Farm Afforestation and Sequestration Project, China, Asia.

All information taken from project developers’ materials, correct as of October 2019.

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PROJECT PORTFOLIO HIGHLIGHTS

25.2 MILLION TONNES OF CARBON CREDITS GENERATED BY 2021

770,000 TONNES OF CARBON CREDITS GENERATED ANNUALLY ON AVERAGE

CORDILLERA AZUL NATIONAL PARK REDD+ PROJECT PERU, SOUTH AMERICADEVELOPED BY ALTHELIA FUNDS

QINGHAI AFFORESTATION PROJECTCHINA, ASIADEVELOPED BY SHELL AND CLIMATE BRIDGE

The Cordillera Azul project supports a rich ecosystem of indigenous biodiversity, high carbon stock forests and a multicultural population of more than 250,000 people organised in 400 communities living in the buffer zone around the Park boundaries. The project protects this unique biodiversity and restores degraded lands with agroforestry systems (cocoa and coffee) in the buffer zone, which are relied upon by small farmers and local communities for their livelihoods.

IMPACT TARGETS FOR 2021 PROJECT HIGHLIGHTSPROJECT COMMITMENT TO UN SUSTAINABLE DEVELOPMENT GOALS (SDGs)Providing additional benefits

The Qinghai Afforestation Project is located on an inland plateau southwest of the Qilian Mountain and crossed by the Huangshui River. The region is subject to extreme weather conditions.

The project covers two rural counties in Xining city where the predominant land use is agriculture. Xining city is one of the most important historic cities in Northwest China because it is located on one of China’s busiest trade routes.

THIS PROJECT MEETS THE FOLLOWING SDGs:1.6 million hectares of threatened forest protected

28 High Conservation Value Species protected

716 jobs supported, 30% held by women

25 sustainable enterprises created or supported

Producing sustainable commodities including Fair Trade and organic cocoa and coffee

Helped 6 communities to improve their schools, benefiting 5,000 people

13,862 hectares covered by the project

Protection of 2 Critically Endangered species

More than 10,000 jobs created to plant and directly created to plant and maintain the forests

7,000 female community members who will have improved livelihoods or income

The Qinghai VCS+CCB Project is an afforestation in Qinghai Province, China. It is designed to increase carbon sequestration and contribute to local sustainable development by planting trees on the barren or degraded lands.

CO2

COMPENSATE EMISSIONS

Shell works with a carefully selected group of environmental project developers whose projects generate voluntary carbon offsets. Shell is also becoming a project developer partnering with key players across the world.

To find out more about our projects: www.shell.com/emissionsreductionprojects

All information taken from project developers’ materials, correct as of October 2019. All information taken from project developers’ materials, correct as of October 2019.

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CREATE LONG-TERM SUSTAINABILITY VALUE FOR YOUR BUSINESSInvesting in clean energy solutions, you will help to shape a more sustainable energy future.

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COMPENSATE EMISSIONS

COMBINED NATURAL GAS AND VOLUNTARY CARBON OFFSETSA step further in your decarbonisation journey

BENEFITS FOR YOUR BUSINESSShell Energy Europe, your trusted partner to deliver clean energy solutions for you

To help you offset the unavoidable emissions that are produced by natural gas combustion at your site, we can tailor a solution that is carbon neutral.

We can source and supply gas at competitive prices, giving you the opportunity to fix and unfix your commodity price before your gas is delivered.

Your natural gas supply is bundled with independently verified carbon credits to compensate greenhouse gas emissions from gas combustion.

We use emission factors published in the National Inventory Reports to calculate your emissions from combustion of natural gas.

We guarantee that the consumed volume of natural gas matches the volume of credits and provide you with a CO₂ compensation certificate.

You will be able to use all available marketing materials related to our global portfolio of nature-based projects to add value to your brand.

We supply natural gas with high-quality, voluntary carbon credits from nature-based projects around the world.

Illustrative example:For every 100 GWh of energy produced by burning natural gas, 20,400mt CO₂e is emitted.* These unavoidable emissions can be compensated through the retirement of 20,400 nature-based carbon credits. A certificate documenting the removal or avoidance of the CO₂ emissions will be issued.

*Conversion rates may vary by country.

Certificate

20,400mtCO2e

100 GWh

SHOWCASE CLIMATE LEADERSHIPClimate leaders are those who are pushing the limit for what companies or organisations can do to combat climate change.

APPEAL TO YOUR CUSTOMERS AND EMPLOYEESDifferentiate from less-responsible brands, create new sustainable products, inspire your workforce to engage with carbon reduction activities in-house.

MEET YOUR GREENHOUSE GAS EMISSIONS COMMITMENTSWhatever your decarbonisation targets are, we can provide you with tailor-made clean energy solutions that help you avoid, reduce and/or compensate your emissions.

www.shell.com/see/cleanenergysolutionsCLEAN ENERGY SOLUTIONS

DisclaimerApproved for issue by Shell International Trading and Shipping Company Limited. Shell International Trading and Shipping Company Limited is authorised and regulated in the UK by the Financial Conduct Authority (“FCA”). All financial products and services referred to in this document are offered through Shell Energy Europe Limited and Shell Trading International Limited, acting through its agent, Shell International Trading and Shipping Company Limited. Shell International Trading and Shipping Company Limited is authorised and regulated in the UK by the Financial Conduct Authority (“FCA”). The products and services referred to are directed exclusively at market professionals and institutional customers and are not available to Retail Clients, as defined by the FCA. Outside the UK, local regulations or restrictions may apply. This information is thought to be reliable; however, Shell and its affiliates make no representation as to the accuracy or completeness of the information contained herein or otherwise provided and accept no responsibility or liability, in contract, in tort, in negligence, or otherwise, should the information be found to be inaccurate or incomplete in any respect. Shell and its affiliates are not acting as an advisor to the recipient of this information, and the ultimate decision to proceed with any transaction rests solely with the recipient of this information. Therefore, prior to entering into any proposed transaction, the recipient of this information should determine, without reliance upon Shell or its affiliates, the economic risks and merits, as well as the legal, tax, and accounting characterisations and consequences, of the transaction and that it is able to assume these risks. This information is neither an offer to sell nor the solicitation of an offer to enter into a transaction.