Shell has canceled the construction of its biofuels factory in the Netherlands, ending what would have been one of the largest waste converters with green jet fuel in Europe.
The oil company, which took a construction break on the site in July of last year to tackle the technical problems, said that it had decided not to restart construction after having noticed that the factory would be “insufficiently competitive” to meet the demand for “affordable products with low carbon content”.
The move to eliminate the project in Rotterdam marks another setback for its biofuels conceptions, after the company canceled a sustainable aviation fuel project (SAF) on Bukom Island in Singapore in March 2023.
It occurs in the midst of a broader distance from renewable energy projects in the oil and gas sector while fossil fuel companies pursue higher profits.
In March of last year, Shell educated a target of key emissions, stating a plan to reduce the intensity of energy carbon emissions that it sells by 15 to 20% by the end of the decade compared to its previous 20% target.
Shell began building the factory in Rotterdam in the Netherlands in 2021, initially expecting to start producing up to 820,000 tonnes of biofuels, with plans to put it online in April 2024. This was then pushed until 2025.
Machteld de Haan, head of the company downstream, downstream, renewable energies and energy, said: “While we assess the market dynamics and the cost of completion, it has become clear that the project would be insufficiently competitive to meet the needs of our customers of affordable products and low -fighting against carbon.
“It was a difficult decision, but the right one, because we favor our capital towards projects that meet both the needs of our customers and our value for our shareholders.”
She added that the company continued “to believe that the low carbon molecules, including biofuels, underlie the future energy system” and that Shell was “one of the largest traders and suppliers of biofuels in the world, including sustainable aviation fuel”.
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About half of the Rotterdam plant biofuels were to be used for SAF, made from waste cooking oil and animal fat.
SAF supporters believe that it could be crucial for airlines to reduce their carbon emissions in accordance with global climate targets, although criticism argues that this is not a realistic alternative given the limited time scale to prevent the increase in emissions from creating a climate disaster. The aviation industry represents around 3% of world carbon emissions, according to the International Energy Agency.
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