Global Witness lodges greenwashing complaint against Shell to US financial regulator.
February 1, 2023, Washington D.C. – Just 1.5 per cent of Shell plc’s total expenditure in 2021 was invested into wind and solar power generation, despite claims of much higher investment into renewable energy, today forming the basis of a new greenwashing complaint against Shell to the US Securities and Exchange Commission (SEC).
In a pioneering complaint, Global Witness is calling on the SEC to investigate Shell’s misleading claims that overstate its energy transition efforts in part by including polluting fossil gas as part of its “renewable and energy solutions”.
Analysis of what Shell labels as “renewable and energy solutions” investments ($2.4 billion out of a total $19.7 billion expenditure in 2021) suggests that just $288 million was directed towards wind and solar power generation. This means that only 1.5 per cent of Shell’s total expenditure, in the most recent year for which there are full records, was used to produce wind and solar power.
Further analysis by Global Witness found the widespread use of fossil gas across its proclaimed renewable spending, including in integrated power, gas marketing and trading, hydrogen, and carbon capture and storage. Although Shell does not state how much it spends on fossil gas that it markets as renewable investment, it appears to be a significant portion.
Zorka Milin, Senior Adviser at Global Witness, said:
“Shell’s so-called renewable and energy solutions category is pure fiction. The company is living in fantasy land if it thinks fossil gas has any place in the much-needed energy transition. Shell’s business model has always been, and continues to be, overwhelmingly based on climate-polluting fossil fuels.”
“Overstating investments in renewables and misleading the public is pure greenwashing. Climate action cannot be dreamed up in marketing departments, instead it must underpin the concrete activity of the company as a whole.”
“With today’s complaint to the US Securities and Exchange Commission, not only are we putting Shell on notice but the entire fossil fuel industry at large. No more will we allow big polluters to pull the wool over our eyes while the world burns.”
Anything but renewable, fossil gas is the third most carbon-intensive method of generating electricity, according to the International Panel on Climate Change. The UN Environment Program says methane, the primary component of fossil gas, is responsible for more than a quarter of the global warming the world is today experiencing.
Global Witness calls on the SEC to open an investigation into whether Shell violated the relevant US securities laws, and if appropriate, to impose fines and to prohibit Shell from further violations. SEC action on this complaint would be the first application of long-standing US investor protection laws against any fossil fuel company for misleading investors on climate-related claims.
In response to claims in this complaint, a Shell representative wrote that “Shell is confident that its financial disclosures are fully compliant with all SEC and other reporting requirements” and pointed to disclosures in recent quarterly and annual reports in which “Renewables and Energy Solutions” is defined as including the gas-related activities described above.
This complaint comes the day before Shell is set to announce record annual profits, following criticism of profiteering from Russia’s invasion of Ukraine and the subsequent global energy crisis. Shell has sought to defend itself against these claims by suggesting its bumper profits are being spent on an energy transition.
Zorka Milin added:
“Shell shouldn’t get away with using its tiny investments in renewables as a fig leaf to cover up the reality that it is continuing to profit from the energy crisis at the expense of people and the planet. We call on the US authorities to hold Shell to account and to set a precedent to ensure other fossil fuel companies do not engage in similar greenwashing.”