British energy giant BP has announced plans to sell its US onshore wind energy business, BP Wind Energy, citing misalignment with its strategic growth goals. The sale, which includes ten onshore wind assets across seven US states with a combined net generating capacity of 1.3 GW, is expected to begin in autumn 2024.
This move comes amid a broader shift in BP’s strategy, driven by new CEO Murray Auchincloss, who has placed renewed emphasis on oil and gas, halting offshore wind projects and implementing a hiring freeze. BP’s pivot contrasts with the earlier direction set by former CEO Bernard Looney, who had aimed for a rapid transition away from fossil fuels.
The sale decision aligns with BP’s focus on integrating onshore renewable power development into Lightsource bp, Europe’s largest solar energy developer, which BP plans to fully acquire by the end of 2023. BP’s reorientation has affected its share value, as renewable energy returns have waned, while oil and gas profits surged post-pandemic and following the Ukraine conflict.
BP’s shift mirrors broader industry challenges in the US, where rising material costs, high interest rates, and supply chain issues have led many offshore wind companies to cancel or renegotiate contracts for planned projects.
In a parallel move, Lightsource bp and Contact Energy secured financing in August 2024 for the 168 MWdc Kōwhai Park solar farm in Christchurch, New Zealand, under a green financing loan underwritten by Westpac, Mizuho, China Construction Bank, and Intesa Sanpaolo.