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Friday, 19 October 2007

Shell makes a statement

James Smith, UK Chairman of Shell, has authored an article in the BBC's 'Gren Room' today

Smith draws attention to what he sees as a number of 'hard truths':

  • acceleration of global energy demand
  • fossil fuels will continue to be the main source of energy for decades to come
  • production of "easy oil" (oil and gas that are relatively easy to extract) will not keep pace with the growing demand
  • carbon dioxide (CO2) emissions are set to rise even faster than demand for energy
He urges governments to urgently provide policies that encourage investment in new technologies and energy conservation, and comments that "a good way to put a price on CO2 and to force reductions is to implement a "cap-and-trade" system."
Not exactly a revolutionary statement there.
He goes on to clarify Shell's role:
Companies like Shell must work to make a diversified mix on energy sources fit for the world's purpose. That purpose is enough energy to support economies while avoiding the damage of climate change.
That is why Shell has such a broad range of technology developments, from clean coal, to making oil sands less carbon intensive, to later generation biofuels that make biofuel from crop waste, to wind, to thin film solar and to hydrogen.
Shell apparently have the broadest alternative energy portfolio of any major energy company, having established renewable energy as their fifth core business in 1997. However, in an article on June this year in the GUardian, Greenpeace (always good for an opposing pr angle) pointed out that global energy investment was in the region of $1 trillion a year and that BP and Shell spent 5% or less of their money on supporting renewables and 95% on oil and gas schemes.
As ever, the truth is probably somewhere between the two. Shell should be applauded for making moves towards bringing renewables further into the mainstream. However, I still feel that the nature of their core business prevents them from being a true and credible leader in the sector.

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