Shell is further scaling back its involvement in major energy transition projects and has definitively abandoned plans for a biofuel plant in Rotterdam. The company halted construction following an economic and technical reassessment. High completion costs and weak market conditions rendered the project unprofitable in Shell’s view. At the same time, the company is selling off wind and solar projects in Europe and India. Consequently, Shell is shifting its capital back toward oil, gas, LNG, and other high-yield business areas.
Biofuel project in Rotterdam permanently halted
Shell had approved the facility in 2021 and begun construction in 2022. It was intended to produce up to 820,000 tonnes of renewable diesel and sustainable aviation fuel annually. Planned feedstocks included used cooking oils, animal fats, and industrial residues, among others. However, Shell initially halted work on a temporary basis in July 2024.
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In September 2025, the group finally drew a line under the project. Shell stated that the remaining construction costs were no longer economically justifiable given the market conditions at the time. Consequently, the company decided against investing further capital in the biofuel project. Instead, the aim is for investments to generate higher returns and improve the group’s financial flexibility.
Shell Sells Wind and Solar Projects
However, the withdrawal now extends well beyond Rotterdam. In early August 2026, Shell agreed to sell its European onshore renewable energy business to TotalEnergies. The package includes approximately 500 megawatts of capacity—either operational or already under construction. Ownership of development projects for an additional 3.5 gigawatts of wind, solar, and battery storage capacity is also changing hands.
Shell is also divesting a large renewable energy portfolio in India. In July 2026, the group agreed to sell Sprng Energy to Aditya Birla Renewables. The purchase price, including debt, is approximately $1.8 billion. With this move, Shell is offloading a company it had acquired only in 2022—a business that possesses several gigawatts of renewable energy capacity.
Oil, gas, and LNG yield significantly higher returns
While Shell sells off green projects, its oil, gas, and LNG operations are proving particularly profitable. In the second quarter of 2026, the group posted an adjusted profit of $9.84 billion—up from just $4.26 billion a year earlier. Higher energy prices, along with strong performance in LNG and oil trading, were key drivers of these results.
This economic disparity explains the shift in strategy. Shell is not abandoning the energy transition entirely, but it is increasingly limiting investments to projects offering attractive returns. Major undertakings, such as the Rotterdam biofuels plant, are falling victim to this approach. At the same time, more capital is flowing into traditional energy businesses, while wind, solar, and other renewable energy projects are being sold off or scaled back.
Author: Blackout News
Sources: Reuters (03.08.26) – Allsurplus (Stand: 06.08.26) – Biomass Magazine (03.08.26)