LONDON (Reuters) - Oil Major Royal Dutch Shell Plc doesn’t plan to make any more large investments in wind and solar energy in the future and does not expect hydrogen to play an important role in energy supply for some time.
“We do not expect material amounts of investment in those areas going forward,” Linda Cook, head of Shell’s gas and power unit told reporters at a press conference on Tuesday.
“They continue to struggle to compete with the other investment opportunities we have in our portfolio,” Cook said of solar and wind.
Shell’s future involvement in renewables will be principally limited to biofuels, which the world’s second-largest non- government-controlled oil company by market value believes is a better fit with its core oil and gas operations.
In the past year, the company said it was refocusing its wind business on the U.S. as it pulled out of European projects.
Shell has around 550 megawatts of wind power capacity but does not break out figures for investment in each renewable energy source.
From 1999-2006 Shell invested around $1.25 billion in green energy, according to Reuters analysis of Shell’s statements. Wind played a large part of that.
One renewables analyst said the decision could reflect the $100/bbl drop in oil prices since July which has eased concerns about energy supply and the economic crisis which has pushed environmental concerns down the agenda.
“There may not be any political pressure on them to invest in renewables at this particular stage,” the analyst, who asked not to be named, said.
The decision may anger environmental groups who, in recent years, have put pressure on Shell over its major investments in Canada’s oil sands, an energy and water intensive business which involves squeezing crude from bitumen-soaked soil.
While Shell’s advertising focuses on its involvement in renewable energy, only around 1 percent of its investments go to these energy sources.
Additional reporting by Michael Szabo; Editing by Rupert Winchester