Shell Commits to RE Investments Worth $565 M in Brazil by 2025

Anglo-Dutch energy giant Royal Dutch Shell has committed to invest 3 billion reais ($565 million) by 2025 in renewable energy in Brazil, for which it has launched a new division, Shell Energy Brazil, in the country.

Most of the capex is related to solar energy projects, Reuters reported executives as saying. The head of renewable development for Latin America, Gabriela Oliveira, said Shell has 2GW of solar energy projects under development and expects to reach 5GW by year-end. According to Oliveira, Shell also intends to launch an offshore wind development campaign this year.

“The launch of the brand in Brazil reflects the effort towards decarbonization and also the opportunities opened up by the New Gas Law and by the entry of consumers into the free electricity market,” stated Guilherme Perdigão, director of renewables and energy solutions at Shell Brazil and Shell Energy. Shell has not dismissed the possibility of making new investments in renewable energy generation joint ventures, Perdigão, added.

The company also plans to develop natural gas-fired thermal plant Marlim Azul and expects to begin generation by next year, the executive said during a press conference for the launch in Brazil of Shell Energy, the company’s division focused on clean energy and decarbonization.

Brazil is increasingly seen as an attractive market for solar by analysts and investors given the country’s energy needs, a lack of supply, favourable legislation and climate. At present, Shell Energy Brazil has six solar projects with a combined capacity of more than 2 GW, including the partnership with local steel producer Gerdau SA to develop a 190-MW direct current solar project in Minas Gerais state.

• On August 5, 2021, Shell Brazil marked the start of trading in shares of Raízen, the renewable energy joint venture between Shell and Brazilian energy company Cosan, on the São Paulo Stock Exchange (B3), following the successful execution of an initial public offering (IPO). “Shell is committed to Raízen as we grow our renewable energy business and our presence in Brazil and Argentina,” Huibert Vigeveno, Shell’s Downstream Director had said then.

Although Shell announced in February investments worth US$2 billion and US$3 billion on renewables and energy solutions annually to help it attain net zero status by 2050, it remains largely dependant on fossil fuels. The oil and gas major recently came under fire for its unwillingness to regulate its Scope 3 emissions, i.e. the emissions released by the consumers of its products, such as utility companies and gas stations that are providers of electricity and gasoline.