Royal Dutch Shell will launch next week an initiative with multiple partners which it says will investigate and inform how the world can shift to a low-carbon economy.
The first task of its “Energy Transitions Commission” may be to convince sceptics of its sincerity and impartiality.
Shell has recruited external thought leaders and the chief executives of multiple energy, technology and consultancy companies to the Commission, which it will launch at a “Fortune Brainstorm” conference on energy, technology and sustainability in Texas.
It is difficult to know, before seeing the results, how far the initiative is enquiry, brand management, a strategic attempt to bend the debate, or a combination of these.
Naturally, some doubters might wonder if this is Shell’s attempt to get back on the front step, after long-running environmental campaigns against its Arctic drilling, in the run-up to the biggest summit on climate change for years, in Paris at the end of this year. And some will question how sincerely a fossil fuel company can contribute to a low-carbon transition which ultimately threatens its core business.
Some “progressive” solar energy and digital technology companies have been invited to the Commission, which is a good sign, alongside fossil fuel companies such as BHP Billiton and Statoil. But would Shell follow the advice of its own Commission, or, how impartial would it be?
So far, Shell has offered a skewed vision of the world’s energy future. Its own analysis concludes that renewable energy will only make up – at the very most – 25% of the global energy mix in 2050. But even coal-dominated China has signalled that renewable energy will reach about this level in its own energy mix some 20 years sooner, in 2030. An alternative view is that the falling cost of solar power plus the energy ambition of technology companies like Apple may see fossil fuels get left behind in coming decades.
Shell’s view reflects its own fossil fuel business. In power generation, it wants to promote its gas business over higher carbon-emitting coal. It is also a leader in developing carbon capture and storage (CCS), as a technology to eliminate emissions from gas-fired power. But it has exited most of its interests in wind and solar. In transport fuels, Shell has only very small biofuel ventures, and little or no interest in electric vehicles.
Shell may want to influence its Commission. Who knows, the key findings may repeat its call for a global carbon price, which will hurt coal. And it will want to highlight CCS in the fight against climate change, given the funds at stake. In Britain, Shell is hoping to win next year a share of £900 million for its gas-CCS project at Peterhead in Scotland.
If its Commission can also convincingly analyse, argue and inform across a wide range of other scenarios, it could make a useful contribution, perhaps even to Shell itself.