LONDON (Reuters) - Royal Dutch Shell (LON:RDSa) said on Thursday it would offset the carbon dioxide emissions of around 1.5 million road users in Britain starting later this month under a loyalty scheme.
Shell, like other oil companies, has come under pressure from shareholders to show how it plans to reduce its carbon footprint and help cut greenhouse gas emissions, a major cause of global warming.
Britons are increasingly concerned about their environmental impact, with thousands of students striking earlier this year and green group Extinction Rebellion carrying out civil disobedience to push for more ambition on climate change.
Sinead Lynch, Shell UK country chair, said the best way for people to cut their road emissions was to use electric vehicles, supplied with renewable power.
"But today the majority of people still use petrol and diesel. We can help them address the impact of their emissions by offsetting their fuel purchases," she said in a statement.
From Oct. 17, emissions relating to fuel purchased by customers with the Shell Go+ app or card will be offset for free until September 2020.
Shell said about 20% of its customers were registered with the loyalty scheme. It expects the program to cost roughly 10 million pounds ($12.2 million) and offset emissions from around 1.5 million cars.
Carbon offsetting involves helping to fund a cut in emissions elsewhere, such as through preventing deforestation.
Some climate groups say offsetting should be used as a last resort and that absolute emission cuts should be the priority.
Shell said it would use carbon credits from conservation projects in Peru, Indonesia, the United States and Britain.
Most of the credits that will be used for the scheme have already been bought, Shell said, but it did not disclose the purchase price.
The cost of carbon offsets varies widely depending on the type of project and the social and environmental benefits it brings.
Credits traded under a U.N.-backed scheme are trading at around 0.22 euro per tonne of carbon dioxide, while carbon-offsetting firms can charge around 8 euros a tonne.