Shell retail looks to the future with car charging

ROYAL Dutch Shell wants 20 per cent of fuel margins from its retail forecourts to come from vehicles that don’t burn diesel or gasoline, as the company anticipates an accelerating transition to clean energy over the coming decade.

Shell set up its first hydrogen refueling station in the UK earlier this year and will install its first electric car charging point later this month, said John Abbott, the top executive of its downstream business, which includes refining, marketing, retail, trading and chemicals. By 2025, he expects these new operations supplying cleaner fuels, including natural gas, to make up a fifth of margins from selling fuel.

As major markets including France, the UK and China talk about phasing out the sale of fossil-fuel-powered cars in the coming decades, major energy companies are taking steps to prepare and adapt.

The downstream businesses of Shell and its peers have been an important source of profit during the oil market’s threeyear downturn, but there are growing signs that demand for gasoline and diesel will start to wane as people switch to new forms of transport.

Shell and rivals including BP have said that demand for oil could stop growing as early as the 2030s as the use of electric vehicles expands and more renewable sources of energy are used.

As battery prices drop, the proportion of fully electric cars sold in the UK will rise to one in 12 by 2030, from one in 200 today, according Bloomberg New Energy Finance. — WPBloomberg