Shell offloads all European onshore solar and wind farms to TotalEnergies as it refocuses on oil and gas

The deal

Shell announced on Monday that it is selling its entire European onshore renewable energy business to French rival TotalEnergies. The portfolio includes solar farms, onshore wind parks and battery storage facilities in the Netherlands, Italy, Spain and the United Kingdom. In the Netherlands, the sale covers five solar parks in Moerdijk, Heerenveen-Zuid, Emmen and two in Terneuzen, plus the combined wind and solar park Pottendijk in Emmen. The operational and in-development assets have a combined capacity of 0.5 gigawatt, roughly 12% of Shell's total energy projects and enough to power about half a million households. TotalEnergies also acquires a development pipeline of 3.5 GW of future solar, wind and battery projects in Italy, the UK and Spain. Financial terms were not disclosed. The transaction is subject to regulatory approval and is expected to close by the end of 2026.

Shell's retreat from green energy

The sale is the latest in a series of moves by Shell to scale back its renewable ambitions and refocus on oil and gas. Since Wael Sawan took over as CEO in 2023, the company has been reviewing its low-carbon investments. Late last year, Shell sold its stakes in two offshore wind farms off the Scottish coast. Earlier this month, it offloaded Indian renewables subsidiary Sprng Energy for nearly 1.6 billion euro. In April, Shell spent 12 billion euro to acquire a Canadian oil and gas company. The company has also been exploring new oil fields in Angola and Namibia. Shell's earlier climate target of a 45% reduction in emissions by 2035 has been dropped, though the company still pledges net zero by 2050.

“This agreement reflects Shell's focus on active management and improving its portfolio.”

TotalEnergies doubles down on renewables

While Shell retreats, TotalEnergies is expanding its green footprint. The French major has been actively buying renewable energy assets. Alongside the Shell deal, TotalEnergies announced that US investment firm KKR will acquire a 50% stake in a separate 1.2 GW portfolio of onshore solar and wind projects in Germany, Spain, France and Poland. The value of that portfolio is 1.8 billion euro, with TotalEnergies retaining the other half. Stéphane Michel, TotalEnergies' president for gas, renewables and power, said the company would keep 50% of the assets.

Shell operational0.5

Shell pipeline3.5

TotalEnergies-KKR portfolio1.2

Shell operational

0.5 GW

Shell pipeline

3.5 GW

TotalEnergies-KKR portfolio

1.2 GW

Data from the article text

What Shell keeps

Shell is not exiting renewables entirely. The company will retain its offshore wind farms and continue trading green power in Europe. It is also pressing ahead with the Holland Hydrogen I plant in the port of Rotterdam, which is designed to produce 60,000 kilograms of green hydrogen per day from 2027. Carbon capture and storage projects remain in the portfolio as well.

Expert view

Energy expert Jilles van den Beukel of The Hague Centre for Strategic Studies called Shell's decision "inevitable" from a business perspective. He said the company had been disappointed by the returns from its renewable energy projects and that shareholders were demanding results. Van den Beukel noted that Shell is gradually moving away from Europe, having already relocated its headquarters from The Hague to the UK. He suggested the company might eventually shift its centre of gravity to the United States, where the investment climate for fossil fuel companies is more favourable. He contrasted TotalEnergies' approach, pointing out that the French state, though only a 1% shareholder, still exerts influence over the company's direction.

“Shell is moving away from Europe.”