Shell has sold its European wind and solar energy business to French rival TotalEnergies in its latest retreat from green energy. The sale includes assets located across the United Kingdom, Italy, the Netherlands and Spain.
The offloaded assets together accounted for around 0.5 gigawatts of renewable energy capacity, alongside a pipeline of future development projects. The companies did not disclose the purchase price for the business.
The sale represents another pivot away from green energy as Shell proceeds with plans to double down on oil and gas production. Under chief executive Wael Sawan, the company has deprioritised low-carbon investments in favour of a more profitable fossil fuels business.
Last week, Shell reported that it had more than doubled its earnings in the second quarter of the year. The group cashed in on severe disruption in energy markets after the Iran war pushed up oil and gas prices.
Machteld de Haan, president of downstream, renewables and energy solutions at Shell, said: "We are recycling capital and prioritising areas where we have differentiated capabilities and can create the most value over time, including through asset-backed power trading and customer-focused energy solutions."
Shell shares rose 0.7 per cent, or 22p, to 3405.5p following the news.
Refocus on fossil fuels
Sawan said Shell would prioritise money-making assets rather than the lower returns offered by wind and solar farms. The company is also executing a cost-cutting drive focused on boosting investor returns rather than cutting carbon emissions.
Shell has also abandoned plans to develop offshore wind farms in Scotland. The European green energy sale comes after Shell offloaded its India-based renewable unit, Sprng Energy, in June, four years after purchasing it for $1.6billion.
Shell's main British rival, BP, is also focusing on fossil fuel production and slimming down operations under its new boss, Meg O'Neill.
Last week, BP put its North Sea business up for sale. O'Neill said the unit would be "better positioned as part of another company."
