Spillover

The report details how Shell and TotalEnergies integrate themselves across the VCM value chain—from project development and trading to influencing governance—to maintain fossil fuel production while claiming progress toward net-zero. It highlights systemic issues with the integrity of the credits they use, specifically in forestry and cookstove projects, and notes that neither company has a decarbonisation plan aligned with the Paris Agreement.

• Shell and TotalEnergies have failed to establish net-zero commitments aligned with the Paris Agreement 1.5°C goal, instead using carbon credits to mask a lack of meaningful action.
• Shell maintains a comprehensive presence in the VCM by acting as a project developer, trader, and influencer of market rules. It has invested in nature-based projects in Australia and Brazil, and technology-based projects in the US and India, including a household-efficiency programme in India called Project SHINE I.
• Shell's carbon credit portfolio is heavily reliant on forestry-based credits, including REDD+ projects. Between 2017 and 2026, Shell retired nearly 50 million credits, with over 34.4 million belonging to REDD+ projects. Specific projects like Cordillera Azul in Peru and Kasigau Corridor in Kenya have been criticised for inflating baselines and overstating climate benefits.
• Shell has been linked to fraudulent or low-integrity projects, including 27 C-Quest cookstove projects suspended by Verra for overcrediting and falsified data, and ARR projects in Guizhou, China, which were rejected due to inauthentic land tenure documentation.
• TotalEnergies is expanding its role as a project developer, notably through agreements with Anew Climate and NativState to develop Improved Forest Management (IFM) projects in the United States. It also aims to build a portfolio of 50 million nature-based credits by 2030 to offset scope 1 and 2 emissions after 2030.
• TotalEnergies has used low-quality credits to support misleading 'carbon neutral' claims for its liquefied natural gas (LNG), including credits from the Kariba REDD+ project in Zimbabwe and the Hebei Guyuan Wind Power Project in China.
• Shell exerts influence over VCM governance through representatives in the VCMI Stakeholder Forum and the CFTC Energy and Environmental Markets Advisory Committee, as well as through trade associations like IETA and API.

APA

Wyburd, I., & Zisis, C. (2026). Spillover. Carbon Market Watch. https://carbonmarketwatch.org/wp-content/uploads/2026/08/26_08_Spillover.pdf

Chicago

Wyburd, Inigo, and Christoforos Zisis. Spillover. Carbon Market Watch, 2026. https://carbonmarketwatch.org/wp-content/uploads/2026/08/26_08_Spillover.pdf.

Wikipedia

{{cite report |last1=Wyburd |first1=Inigo |last2=Zisis |first2=Christoforos |title=Spillover |publisher=Carbon Market Watch |date=September 2026 |url=https://carbonmarketwatch.org/wp-content/uploads/2026/08/26_08_Spillover.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{wyburd2026spillover, author = {Wyburd, Inigo and Zisis, Christoforos}, title = {{Spillover}}, institution = {Carbon Market Watch}, year = {2026}, month = sep, url = {https://carbonmarketwatch.org/wp-content/uploads/2026/08/26_08_Spillover.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }