In 2024, despite high inflation and interest rates, the global LPG market somewhat stabilized, with modest growth and price stability returning after years of post-pandemic volatility. In addition to geopolitics and regulatory action, changing customer behavior, linked to energy security, energy costs and the energy transition, continued to play a pivotal role in market dynamics. LPG growth continued its gradual shift towards Asia, Africa and Latin America, with the EU balancing security of supply against the urgency of transition.
SHV Energy was affected by a number of external circumstances including a warmer winter at the start of the year; socio-political challenges in Bangladesh; supply pressure in India; hyperinflation in Turkey; and spillover from the Russia-Ukraine conflict to neighboring countries such as Poland and Germany. These challenging circumstances were offset by more positive developments in other regions including Brazil and Ireland, resulting in a flat volume development (adjusted for divestments) compared to 2023.
SHV Energy continued to pursue its strategy of ‘Advancing Energy Together’ with the goal of providing customers with cleaner and affordable energy alternatives over the long-term. In doing so, it remained fully aligned with SHV’s guiding purpose: the courage to care for generations to come. As in previous years, SHV Energy’s strategy is founded on three building blocks: (1) achieving the full potential of the current LPG business while exploring opportunities to optimize and selectively grow; (2) supporting the energy transition by providing sustainable fuel alternatives; (3) exploring renewable solutions to remain competitive in the long-term.
SHV Energy continued to maximize the potential of its LPG portfolio over the course of the year. The Horizons program, launched in 2023, continued at pace. The program clusters countries according to their potential and their specific market characteristics, providing the business with more focus and more efficiency. Results have been positive, with over 800 initiatives covering almost every aspect of the organization.
New growth opportunities and potential market exits are also being continuously reviewed. The successful sale of operations in Austria, Denmark, and Sweden enabled the business to increase its focus on remaining markets, while freeing up capital for strategic projects.
The Group remains committed to supporting the energy transition by providing cleaner alternatives developed from new molecules, while simultaneously leveraging the existing asset base. BioLPG, a greener alternative that shares the same chemical structure as LPG, continues to be offered in selected markets. Further options are also being actively pursued through partnerships and joint ventures – including a new collaboration with DCC to develop renewable liquid gas. Staying true to its entrepreneurial spirit, the company invested in an rDME, dimethyl ether produced from renewable and recycled carbon feedstock, demo plant over the last few years in partnership with UGI. The project, aimed at producing a clean fuel from feedstock, was halted due to technical and commercial challenges, demonstrating the complexities of successfully developing new technologies. Following this, SHV Energy adapted its approach and will continue to explore new pathways within the energy transition.
New ways to expand the business into emerging energy sectors are being continually explored. Examples include SunSource, an Indian solar generation company that continued to grow at a modest pace within a very competitive market; and Ireland-based EM3, which provides advisory services to help European businesses improve their energy efficiency. Looking ahead to 2025, SHV Energy plans to review its Renewable Solutions approach to align more closely with the overall strategy and maximize growth opportunities.
The execution of SHV Energy’s strategy very much reflects SHV’s core values. By putting people first, SHV Energy promotes an inclusive culture and develops talent and new skills within the organization. The health and safety of employees, contractors, and customers remains a priority, with various programs in place across the value chain. ESG has been embedded into the core strategy and focuses on defining a clear set of goals, preparing for CSRD, and developing a roadmap for delivering material results, such as GHG reduction. Digital and transformation initiatives have also supported the organization by leveraging data, analytics, and hyper-automation to optimize business processes and deliver actionable insights. Cybersecurity was also high on the agenda with the goal of minimizing all potential and real risk.
Overall, SHV Energy had a solid operational year. Performance was above average historic levels, despite of a number of one-offs affecting bottom-line results, including having stopped the rDME project and the complicated implementation of a new ERP system in France.
Looking ahead, SHV Energy is well positioned to deliver a strong operational performance in 2025, focusing on execution of its differentiated operating models and delivery of its strategic agenda.
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