BP made its biggest move yet to add renewable energy capacity, swooping for a 9-gigawatt portfolio of US solar projects.
It will pay independent group 7X Energy $220 million for the under-development projects, in a move that instantly propels its renewables pipeline to 23GW.
The UK-based oil and gas group is chasing a 50GW net renewables development goal by 2030 that is among the most ambitious of any fossil group globally, and an interim 20GW by 2025. Its focus so far has been on solar and offshore wind.
Dev Sanyal, executive vice president of gas and low carbon energy, said: “With this purchase, we are continuing to put our strategy in action as we grow our renewables business in a deliberate and disciplined way.
"It brings us 9GW of high-quality solar projects in markets where we can create integrated renewable energy offers through our trading and customer franchises.”
Although purchased by BP independently, the projects — which span 12 states, with the largest concentration in Texas and the Midwest — will be developed by Lightsource BP, its 50/50 PV joint venture.
Lightsource BP international chief executive Kareen Boutonnat told Upstream's sister renewable energy publication Recharge last week how the ability of the oil giant to leverage its expertise in areas such as energy trading is helping to unlock doors for solar development across the world.
Announcing the latest deal, which is expected to be closed within 30 days, BP stressed the projects’ potential to meet the “disciplined low-carbon investment criteria, generating returns of at least 8% to 10%” that have proved vital in its case to investors in its push into renewables.
The new solar foray confirms the company as a significant force in US renewables.
As well as Lightsource BP’s existing US solar investments, BP last year made a dramatic entry to the American offshore wind scene via a $1 billion deal to buy into projects being developed off New York by Equinor.
The US is also home to BP’s long-standing onshore wind operations.
BP America president Dave Lawler said: “In line with our strategy, we’ll aim to integrate these projects with our existing onshore and offshore wind, natural gas and trading and shipping businesses to give customers what they want — reliable, affordable and clean energy.”
(This article first appeared in Upstream's sister renewable energy publication,
Recharge, on 1 June, 2021)