Shell, one of the world’s largest energy producers, has announced it will halt new investments in offshore wind energy. The company instead intends to concentrate on its existing offshore wind projects, and increasing spending on oil and gas operations.
The decision is part of a company-wide review initiated in 2023 to cut costs while prioritizing activities with higher and more immediate financial returns.
Earlier this year, Shell exited two offshore wind projects. Shell pulled out of a South Korea-based floating wind farm in February. In March, the company sold its stake in a company established to develop wind projects off the coast of Massachusetts.
In addition to these moves, Shell weakened its carbon emission reduction targets in 2024. The company cited strong near-term demand for natural gas and uncertainties in the renewable energy transition.
Shell’s decision mirrors a broader trend among energy giants like BP and Equinor. Both companies have also reduced renewable investments under investor pressure to increase profitability and maintain high shareholder payouts.
The offshore wind industry has faced significant challenges in recent years, including rising material costs and higher interest rates, further influencing Shell’s strategic shift.