Shell (SHEL.US) announced on Tuesday that it has signed a long-term agreement to supply renewable energy to Ferrari (RACE.US) through the end of 2034, aiding the luxury automaker in reducing its carbon footprint. Such "Power Purchase Agreements" (long-term contracts where companies buy electricity directly from generators) have gained popularity in Italy in recent years as a way for manufacturers to secure energy costs and ensure green power supply.
Under the agreement, Shell will provide a cumulative 650 gigawatt-hours of electricity over 10 years from a power plant it developed, covering nearly half of Ferrari’s energy needs at its Maranello facility near Modena and supporting decarbonization in its production processes. Shell Energy Italy will also supply additional power and renewable energy certificates to meet all of Ferrari’s electricity requirements in Italy.
The deal is expected to significantly reduce Ferrari’s Scope 1 and Scope 2 emissions—direct emissions from operations and indirect emissions from purchased energy. The luxury carmaker aims to cut absolute emissions by 90% by 2030.
Gianluca Formichetti, CEO of Shell Energy Italy, stated, "We are pleased to further strengthen our collaboration with Ferrari through this significant agreement." Shell is already a partner of Scuderia Ferrari, the automaker’s racing team.
Comments