Shell has agreed to sell its onshore renewable energy business in Europe to TotalEnergies as the British energy company continues to shift its investment focus towards oil, gas and energy trading.
The transaction, announced on Monday, covers renewable energy assets in Italy, the Netherlands, Spain and the United Kingdom. Although the companies did not reveal the financial terms of the deal, they expect the acquisition to be completed before the end of 2026.
The portfolio includes around 500 megawatts of solar and wind projects that are either already operating or currently under construction. It also features a development pipeline of about 3.5 gigawatts of solar, wind and battery storage projects across Italy, Spain and the UK.
The sale reflects Shell’s ongoing strategy under Chief Executive Wael Sawan to reduce spending on some low-carbon businesses while prioritising projects that generate stronger returns in oil, gas and trading operations.
Shell recently reported a sharp increase in second-quarter earnings, supported by stronger energy prices and improved performance in its liquefied natural gas trading business. Its renewables and energy solutions division also returned to profit during the period after posting a loss a year earlier.
Despite reducing its direct ownership of renewable generation assets, Shell has said it remains committed to supplying customers with integrated energy solutions that combine renewable electricity with more reliable forms of power generation.
Separately, TotalEnergies announced it had agreed to sell a 50 per cent stake in a separate 1.2-gigawatt European renewable energy portfolio to investment firm KKR. The transaction values the portfolio at approximately €1.8 billion.
According to TotalEnergies, both deals are consistent with its strategy of expanding renewable and gas-fired power generation in key European markets while bringing in investment partners by selling minority stakes in selected assets.
The French energy company said its European renewable energy portfolio currently comprises nearly 10 gigawatts of installed or under-construction capacity, with a further 27 gigawatts of projects under development. Meanwhile, Shell said it had about 4.5 gigawatts of renewable power generation capacity in operation at the end of the second quarter.
