Introduction

More than 70% of anthropogenic industrial CO2 emissions since the industrial revolution can be attributed to just 180 corporate and state-owned entities. The largest private emitters within this group, including Shell and TotalEnergies, account for more than 24% of global emissions between 1854 and 2024. While both companies have communicated targets to reach net-zero emissions, the report states that neither has a plan in line with the Paris Agreement nor is taking meaningful action to meet them. Fossil fuel companies often use carbon credits to create an illusion of progress towards climate targets, which frequently acts as a smokescreen to avoid necessary structural changes in their supply chains.

A track record of pollution and inaction: big oil’s retreat from net zero commitments

Recent net-zero announcements from major oil and gas corporations are often built on fragile foundations. Shell, for example, opted for a target measuring “Net Carbon Intensity” (NCI), which allows fossil fuel production to grow as long as average emissions per unit of energy decline. In 2024, Shell revised its 2030 target from an initial pledge of a 20% reduction to a looser, flexible 15-20% and scrapped its 2035 target altogether. In 2025, Shell indicated its 2050 target was “outside the company’s planning period”. In 2024, Shell was responsible for 426 megatonnes of emissions, exceeding the total production of Italy in 2023.

Similar patterns are observed at TotalEnergies, which announced its net-zero ambition in 2020 with a focus on reducing carbon intensity by up to 60%. In 2026, the company back-tracked by announcing it would reassess its 2050 ambition, arguing the global energy transition is progressing too slowly. In 2024, TotalEnergies was responsible for 352 megatonnes of emissions, more than the whole of France produced in 2023.

Shell and TotalEnergies dominate forces in the VCM ecosystem

Major oil and gas companies hold a structurally dominant position within the voluntary carbon market (VCM). Beyond purchasing large volumes of credits, these fossil fuel majors influence the supply of credits by financing projects, possessing financial stakes in project developers, and leveraging their transfer through trading desks. They also seek to influence the rules and requirements governing credit quality and use.

Shell’s dominant role in the VCM ecosystem

Between 2017 and 2026, Shell retired nearly 50 million credits from 147 projects, with forestry and land use accounting for over 35 million of these. Shell was the biggest purchaser of carbon credits in the market over the three years preceding 2026, with retirements exceeding 10 million credits in 2025 alone. Shell’s influence extends to supply, having acquired SelectCarbon in 2020 and a minority stake in the Brazilian developer Carbonext in 2022. Carbonext has faced legal challenges; in 2024, Brazil’s Federal Public Prosecutor’s Office filed action against Amazonian initiatives for failing to obtain free, prior and informed consent from Indigenous communities.

Shell also partnered with C-Quest to produce over 60 million credits from cookstove projects. However, in 2024, Verra suspended 27 C-Quest cookstove projects following concerns over overcrediting and allegations of falsified data. Shell’s involvement in the VCM also includes customer-facing schemes like “Shell Go+”, which allows customers to “drive carbon neutral”. Regulators in the UK, Netherlands, Canada, and Germany have ruled such advertising misleading because it relies on low-credibility offsets for fossil fuel consumption. Furthermore, Shell staff have held roles in market institutions like the Voluntary Carbon Market Integrity initiative (VCMI) Stakeholder Forum.

TotalEnergies’ dominant role in the VCM

TotalEnergies plays a significant role in credit supply, acting in a quasi-developer capacity. In 2024, it entered a $100 million agreement with Anew Climate and Aurora Sustainable Lands to develop 20 forest management projects in the United States. In 2025, it signed an agreement with NativState for 13 additional projects. The company aims to build a portfolio of approximately 50 million nature-based credits by 2030 to offset scope 1 and 2 emissions from 2030 onwards.

TotalEnergies has purchased credits from controversial projects, including the Kariba REDD+ Forest Protection Project in Zimbabwe, to support claims that its liquefied natural gas (LNG) was carbon neutral. Analyses indicate the company generated approximately $17 million from LNG cargo marketed as “carbon neutral” while spending only $600,000 on Kariba credits. It also used credits from the Hebei Guyuan Wind Power Project in China, which received low likelihood ratings for achieving claimed mitigation.

Conclusion

Shell and TotalEnergies pursue a strategy to occupy influential positions across the supply, demand, and governance of the voluntary carbon market. This extensive involvement raises significant concerns regarding potential conflicts of interest, as companies whose core business depends on fossil fuel production create the potential to shape market development in ways that prioritise commercial interests over environmental integrity and meaningful emissions reductions.