Oil giant Shell waters down its near-term emission cuts in strategy update
A Shell logo displayed on a sign at a gas station in Nakuru, Kenya.
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British oil giant Shell on Thursday announced plans to moderate its near-term carbon emissions cuts, while maintaining its pledge to become a net-zero company by the middle of the century.
In its latest energy transition strategy update, the oil and gas major said it is now aiming to reduce its net carbon intensity on the third-party use of products it sells by 15% to 20% by 2030, compared with a previous target of 20%.
Shell said it had also dropped its goal of a 45% reduction by 2035, citing “uncertainty in the pace of change in the energy transition.” The net carbon intensity targets are measured against a baseline of emissions in 2016.
“Our focus on value has led to a strategic shift in our power business towards select markets and segments,” Shell CEO Wael Sawan said in a statement. “As a result, we expect lower growth in sales of power overall. We have updated our net carbon intensity target to reflect that change.”
Shell said that by the end of 2023, it had achieved over 60% of its target to halve emissions from its operations by 2030, compared with 2016.
The company also said it achieved its target to reduce the net carbon intensity of the energy products sold last year, with a 6.3% reduction compared to 2016. Shell said this marked the third straight year it had hit its target.
Shell’s update comes as European energy majors continue to tweak their plans in the transition to clean-energy technologies. Last year, British rival BP said it was targeting a 20% to 30% emissions cut by the end of the decade, compared to a previous commitment to a 35% to 40% trim.
BP, which is also planning to become a net-zero company by 2050, said at the time that it needed to keep investing in oil and gas to meet global demand.
Activist investors have put pressure on fossil fuel companies to do more to align their emission reduction targets with the landmark 2015 Paris Agreement, while some have urged firms to scale back on green pledges and instead lean into their core oil and gas businesses.
The burning of fossil fuels, such as coal, oil and gas, is the chief driver of the climate crisis.
‘Exacerbating the climate crisis’
“With this backtrack, Shell bets on the failure of the Paris Climate Agreement which requires almost halving emissions this decade,” said Mark van Baal, founder of activist shareholder group Follow This.
“This backtracking removes any doubt about Shell’s intentions: the company wants to stay in fossil fuels as long as possible,” van Baal said.
“The board not only endangers the global economy by exacerbating the climate crisis, but also puts the company’s future at risk through policy interventions, disruptive innovation, stranded assets, and accountability for the costs of climate change.”
Chief executives of some of the world’s largest energy companies have repeatedly sought to fend off criticism, claiming that Big Oil is not to blame for the climate crisis and saying it isn’t possible to keep everyone happy in the energy transition.
Shell on Thursday reaffirmed its target to become a net-zero company by 2050, a pledge it first made in 2020 under previous CEO Ben van Beurden. The company said it planned to spend $10 billion to $15 billion on unspecified low-carbon solutions between 2023 and 2025.
Shares of Shell were 0.2% higher on Thursday morning. The London-listed stock price is around 1.3% lower year-to-date.
EV sales kept up their momentum in December 2024, with incentives playing a big role, according to the latest Cox Automotive’s Kelley Blue Book report.
December’s strong EV sales saw an average transaction price (ATP) of $55,544, which helped push the industry-wide ATP higher, according to Kelley Blue Book. The December ATP for an EV was higher year-over-year by 0.8%, slightly below the industry average, and higher month-over-month by 1.1%. Tesla ATPs were higher year-over-year by 10.5%.
Incentives for EVs remained elevated in December, although they were slightly lower month-over-month at 14.3% of ATP, down from 14.7% in November.
EV incentives were higher by an impressive 41% year-over-year and have been above 12% of ATP for six consecutive months. Strong sales incentives, which averaged more than $6,700 per sale in 2024, were one reason EV sales surpassed 1.3 million units last year, according to Cox Automotive, a new record for volume and share.
(My colleague Jameson Dow reported yesterday, “In 2024, the world sold 3.5 million more EVs than it did in the previous year … This increase is larger than the 3.2 million increase in EV sales from the previous year – meaning that EV sales aren’t just up, but that the rate of growth is itself increasing.”)
Kelley Blue Book estimated that in December, approximately 84,000 vehicles – or 5.6% of total sales – transacted at prices higher than $80,000 – the highest volume ever. KBB lumps gas cars and EVs together into this luxury vehicle category, so this is where Tesla Cybertruck is slotted.
However, Tesla bundles sales figures of Cybertruck with Model S, Model X, and Tesla Semi(!) into a category it calls “other models,” so we don’t know for sure exactly how many Cybertrucks Tesla sold in Q4, much less in December. However, Electrek‘s Fred Lambert estimates between 9,000 and 12,000 Cybertrucks were sold in Q4, and that’s not a stellar sales figure.
What will January bring when it comes to EV ATPs? What about tax credits? Check back in a month and I’ll fill you in.
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Tesla is now claiming that Cybertruck was the ‘best-selling electric pickup in US’ last year despite not even reporting the number of deliveries.
There’s a lot of context needed here.
As we often highlighted, Tesla is sadly one of, if not the most, opaque automakers regarding sales reports.
Tesla doesn’t break down sales per model or even region.
For comparison, here’s Ford’s Q4 2024 sales report compared to Tesla’s:
You could argue that Tesla has fewer models than Ford, and that’s true, but Tesla’s report literally has two lines despite having six different models.
There’s no reason not to offer a complete breakdown like all other automakers other than trying to make it hard to verify the health of each vehicle program.
This has been the case with the Cybertruck. Tesla is bundling its Cybertruck deliveries with Model S, Model X, and Tesla Semi deliveries.
Despite this lack of disclosure, Tesla has been able to claim that the Cybertruck has become “the best-selling electric pickup truck” in the US in 2024:
It very well might be true. Ford disclosed 33,510 F-150 Lightning truck deliveries in the US in 2024 while most estimates are putting Cybertruck deliveries at around 40,000 units.
Those are global deliveries, but Tesla only delivered the Cybertruck in the US, Canada, and Mexico in 2024, and most of the deliveries are believed to be in the US.
However, there’s essential context needed here, as we highlighted in our recent ‘Tesla Cybertruck sales are disastrous‘ article.
First off, Tesla had a backlog of over 1 million reservations for the Cybertruck that it has been building since 2019. This led many to believe Tesla already had years of demand baked in for the truck and that production would be the constraint.
However, based on estimates, again, because Tesla refuses to disclose the data, Cybertruck deliveries were either flat or down in Q4 versus Q3 despite Tesla introducing cheaper versions of the vehicle and ramping up production.
Again, that’s after just about 40,000 deliveries.
Furthermore, with almost 11,000 deliveries in Q4 in the US, Ford more likely than not outsold Cybertruck with the F-150 Lightning in Q4.
Electrek’s Take
Tesla is in damage control here. There’s no doubt that it is having issues selling the Cybertruck.
Inventory is full of Cybertrucks and Tesla is now discounting them and offering free lifetime Supercharging.
Tesla is great at ramping up production, and it’s clear the Cybertruck is not production-constrained anymore. It is demand-constrained despite having over 1 million reservations.
Again, those reservations were made before Tesla unveiled the production version, which happened to have less range and cost significantly more.
The upcoming cheaper single motor version should help with demand, but I have serious doubts Tesla can ramp this program up to more than 100,000 units in the US.
As a reminder, Tesla installed a production capacity of 250,000 units annually and Musk said he could see Tesla selling 500,000 Cybertrucks per year.
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