Energy Efficiency, Industrial, Sourcing Renewables - November 19, 2021
Baker Hughes and Shell Collaborate to Reach Net Zero Emissions by 2050
Energy technology company Baker Hughes and Shell Global Solutions BV have signed a broad strategic collaboration agreement to accelerate the global energy transition by helping each other achieve their respective commitments for net-zero carbon emissions and advancing solutions to decarbonize energy and industrial sectors.
The memorandum of understanding (MoU) intends to build on the existing relationship between Dutch oil company Shell and Baker Hughes in these areas:
- Shell will initially provide selected Baker Hughes U.S. sites with power and REC and the companies will negotiate renewable power for Baker Hughes’ sites in Europe and Singapore.
- Shell and Baker Hughes also agreed to broader collaboration to identify other opportunities to accelerate each other’s transition to net zero carbon emissions by 2050, such as Baker Hughes providing low-carbon technology solutions for Shell’s LNG fleet.
- The two companies will further explore potential opportunities to co-invest and participate in new models to decarbonize energy and industrial sectors.
“Our agreement with Shell is another example of how we are collaborating in new ways to meet net-zero targets for our company and for our customers,” said Lorenzo Simonelli, Baker Hughes chairman and CEO in a statement. “The urgency around the energy transition to meet Paris Agreement goals requires collaboration to accelerate actionable steps to reduce emissions in various ways."
As a first step in the collaboration, the two companies seek to finalize Shell’s supply of certain Baker Hughes U.S. facilities with power and renewable energy credits for a two-year period. In 2020, Baker Hughes’ global renewable electricity consumption was 22% and with this agreement, it is expected to grow by 2% to 24% annually. Shell and Baker Hughes will also negotiate supply of up to 100 GWh of renewable power for Baker Hughes facilities in Europe and explore the development of an on-site solar solution for Baker Hughes’ chemical blending plant in Singapore.
Shell and Baker Hughes will further collaborate to explore additional opportunities to help Baker Hughes accelerate its transition to net-zero carbon equivalent emissions, including Shell providing low-carbon transportation and fuel solutions for Baker Hughes.
In turn, Shell will evaluate opportunities for Baker Hughes to provide low-carbon solutions for Shell’s LNG fleet through technology upgrades and compressor re-bundles. Baker Hughes will also help Shell develop digital solutions to accelerate decarbonization across Shell’s global assets and operations.
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