BP has bought a pipeline of US solar farms, capable of powering more than 1.7m homes, for more than $220m (£155m) as part of its plan to distance itself from the fossil fuel industry.
The oil company has agreed to snap up a string of development projects, totalling 9GW, from the independent US solar developer 7X Energy in a “significant step” towards its goal of securing 20GW by 2025.
The projects will be developed by the UK solar company Lightsource BP across 12 states in the US, which is one of the world’s fastest growing solar energy markets and is expected to double in the next five years and quadruple over the next decade.
Lightsource BP, the British solar startup which formed a 50:50 joint venture with BP in 2017, broke into its second new market in a week on Tuesday after snapping up 40% of the capacity awarded in a Greek government renewables auction alongside the Greek energy firm Kiefer TEK. The award emerged days after it entered the Portuguese solar energy market for the first time.
Dev Sanyal, BP’s head of gas and low-carbon energy, said the US deal was “a significant step as we continue to deliver on our net zero ambition” by growing the renewable energy business “in a deliberate and disciplined way”.
BP aims to establish a pipeline of renewable energy projects totalling 20GW by 2025 and 50GW by the end of the decade, while slowly reducing its production of fossil fuels to transform from an oil company into a clean energy business.
The group also used the US market for its first significant step into the offshore wind market after agreeing last year to pay $1.1bn (£850m) for a stake in two US offshore wind projects being developed by the Norwegian state oil company, Equinor.
Only a few months later BP and its partner, the Germany utility EnBW, struck a deal to pay the crown estate a record-breaking £462m-a-year to lease the seabed for two offshore windfarms in the Irish Sea capable of powering more than 3.4m UK households.
“This is an integrated energy company in action,” Sanyal said. “This will bring together the best of BP to create value and provide customers with what they want – clean, affordable, energy.”
The company has faced criticism from some investors who believe the company is paying too much to accelerate its move into clean energy. BP’s plans, under the chief executive, Bernard Looney, are some of the most ambitious put forward by a big oil company, and even won cautious praise from green groups including Greenpeace.