Royal Dutch Shell (LON:RDSA) is to launch an electricity supplier in Britain, The Times has revealed. The move is part of the group’s strategic push into the electricity sector as it adapts to rising global demand for clean energy.
Shell’s share price has advanced today, having added about 0.8 percent in mid-morning trade, and outperforming the benchmark FTSE 100 index which is up about 0.2 percent. The Anglo-Dutch group’s shares have added more than 15 percent to their value over the past year, but have given up a little over two percent in the year-to-date.
The Times reported this morning that Shell had applied for a licence to supply power to businesses across Britain and was planning to start signing up industrial customers now to provide them with electricity early next year. The Anglo-Dutch group will further establish a significant business at a stroke by taking over power supply to all 600 sites that it owns in the UK, comprising about 550 petrol stations as well as its offices, terminals and oil and gas platforms.
The newspaper quoted Shell’s chief executive Ben van Beurden as commenting last month that “further electrification of the economy” would be crucial if the world was to hit its climate targets and could hasten the point at which global oil demand would peak. He added that the Anglo-Dutch oil major needed to adapt by getting “involved in the electrical chain, in the renewable business and more in petrochemicals”.
Today’s news comes after Shell recently updated investors on its performance, revealing that its profits had jumped in the second quarter of the year, with the oil major benefitting from higher crude prices and strong refining performance.