Question: How do you convince the world your business plan won’t cause disasterous climate change?
Answer: Make up some numbers to pretend it’ll be fine, while not actually changing anything.
That’s pretty much what Shell did when it released a new climate change scenario in March 2018. Known as the ‘Sky’ scenario, the report outlines how the company thinks the world can prevent warming of more than two degrees while handily still consuming lots of fossil fuels.
Up until recently, Shell effectively rejected the idea that the world would make serious efforts to curb climate change. Both of its climate action plans released in 2013 allowed warming that was far greater than the internationally agreed limit of two degrees — which might explain why it was still busily planning to explore the Arctic for oil.
Analysis from Oil Change International (OCI), published in 2016, reveals that to stand a chance of achieving the Paris Agreement goals, we must enforce a managed decline of the fossil fuel industry.
Shell’s new ‘Sky’ initiative is not in line with this. The report immediately received criticism for not truly testing Shell’s existing business model and instead maintaining the company’s fossil fuel extraction at current levels. OCI said the Sky scenario ‘describes a future with so much oil and gas that the company faces no stress’.
The modelling relied heavily on as-yet-unproven carbon capture and storage technology (CCS), a means of separating out and then burying carbon dioxide when burning fossil fuels. This would allow companies like Shell to keep producing and selling fossil fuels for much longer than if policymakers enacted more effective strategies, such as working to rapidly increase the amount of energy we get from renewables like wind and solar power.
However, CCS technology is still widely considered to be at an experimental stage, with little to no evidence that they could be effectively scaled up in the ways Shell is imagining.
By 2070, Shell says there would need to be at least 10,000 large CCS sites in operation, or 3,000 much larger facilities on the scale of major coal-fired power stations. By comparison, there are less than 3,000 coal plants in total globally today.
In the UK, efforts to get CCS going have proven difficult and expensive, as the UK government concluded in 2015 when it pulled a £1 billion grant from a Shell project to build a new CCS plant in Aberdeenshire.
OCI’s analysis also points out that the Shell scenario relies on eight billion tonnes of carbon dioxide needing to be sucked out of the atmosphere by 2070. This technology does not exist yet but, if it could even be made to work, it would use a staggering amount of land, up to five times the size of India.
Shell is proposing we tackle climate change with unproven technologies such as CCS, but in reality, such projects are nowhere near operational, and may never be. By talking up its prospects, Shell is attempting to preserve the status quo when it’s time to transition.