bp boosts renewables business in U.S. with acquisition

bp has agreed to purchase 9 gigawatts (GW) of solar development projects in the U.S. from independent U.S. solar developer 7X Energy. The acquisition represents a significant step towards bp’s target of growing its net developed renewable generating capacity to 20 GW by 2025 and 50 GW by 2030. 

The deal will also grow bp’s renewables pipeline from 14 GW to 23 GW. The assets will be developed  through bp’s 50-50 solar joint venture Lightsource bp, a global leader in solar energy.

bp will pay 7X Energy USD220 million for the projects and 1 GW of “safe harbour” equipment. The acquisition is expected to close in 30 days. The projects are expected to meet bp’s low-carbon  investment criteria, generating returns of at least 8-10%. 

“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 9 GW of high-quality solar projects in markets where we can create integrated renewable energy offers through our trading and customer franchises,” Dev Sanyal, bp executive vice president of gas and low carbon energy, said.

“We will bring the industry-leading expertise of Lightsource bp together with the breadth of bp’s  integration capabilities in the U.S. to develop this portfolio of projects. This is a significant step as we continue to deliver on our net zero ambition.” 

“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,” Dave Lawler, bp America chairman and president, said.

Solar energy is the fastest growing power source in the U.S. and is expected to quadruple over the next 10 years. It currently accounts for more than 40% of all new electricity generating capacity added in  the U.S. 

The projects are spread across 12 U.S. states, with the largest portfolios in Texas (ERCOT) and the  Midwest (PJM). Assets with a combined generating capacity of 2.2 GW are expected to reach final  investment decision (FID) by 2025, with the remaining progressing by 2030. Once developed, these  projects will have the capacity to generate enough clean energy to power around 1.7 million U.S.  homes. The development is also expected to support thousands of jobs through construction. 

As an integrated energy company, bp is able to combine its trading, mobility and customer expertise  with Lightsource bp’s world-class solar project development experience and execution capabilities.  

“This transaction speaks volumes  about the success of our JV with bp, and how we leverage each other’s strengths to realize our  ambitions for solar and a low-carbon future. It also positions Lightsource bp as a growing force in the  US solar market, as we expand our portfolio across the United States,” said Nick Boyle, group chief executive officer of Lightsource bp.

bp is America’s largest energy investor since 2005, investing more than USD125 billion in the economy and supporting more than 125,000 additional jobs through its business activities.