The Hague-based LNG giant Shell aims to spend as much as $1 billion a year on its New Energies unit by the end of the decade as it is seeking to lower emissions.
“In some parts of the world we are beginning to see battery electric cars starting to gain consumer acceptance. This has to happen as part of society’s push to decarbonise,” Shell Chief Executive Ben Van Beurden said in a speech at the World Petroleum Congress in Istanbul on Monday.
But the weight and capacity limits of batteries still mean there was no immediate zero-carbon solution for air travel, for shipping and for heavy freight, Van Beurden said.
“So the world will need hydrogen fuel cell vehicles, it will need liquefied natural gas as a transport fuel… and it will need the next generation of sustainable biofuels.”
According to the CEO, wind and solar were contributing more and more to the global energy system and this must also happen if the world is to decarbonise.
“But the intermittency of renewables – both day by day and also season by season – means there will be a long-term role for natural gas power generation. New energy storage technologies will, in time, help the intermittency issue, but they do not exist yet,” he said.
During his speech, Van Beurden highlighted the potential for some of the fastest-growing nations to switch directly to a cleaner energy mix.
“When you consider the areas of the world where energy demand is still to expand, like Asia and sub-Saharan Africa, there is a huge opportunity here,” he said. “These are areas that are not, on the whole, locked in to a coal-driven system. There is the potential for them to shift more directly onto a less energy-intensive pathway to development.”
Even so, these growing countries would still require hydrocarbons to develop their industries. Not least because there were some sectors of the economy that are just not yet able to achieve zero carbon, Van Beurden said.
“So, there is not one, single energy transition underway, but many, all running alongside each other. These are happening right now, but they will take many decades to play out,” he said.