BP Putting $200 Million Into Solar Energy Firm Lightsource

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BP will be putting $200 million into the solar energy firm Lightsource, thereby acquiring a 43% stake in it, the company has revealed.

Lightsource, it should be remembered, is the largest solar energy project developer in Europe — and it’s also a firm now aiming to quadruple its project capacity to around 8 gigawatts (GW) over the coming years through large-scale project development in Europe, the US, India, and the Middle East.

The London-based company will have its name changed slightly as part of the deal — with the new tag reading “Lightsource BP,” as one might guess.

It should probably be stated up front that, while the $200 million figure sounds like a lot of money, it represents just a tiny fraction of the money that BP has spent so far this year (which now totals around $17 billion, reportedly).

Commenting on the differences between this new investment and earlier ones in the solar energy industry, the head of BP’s Alternative Energy business, Dev Sanyal, was quoted by Reuters as sayings: “We see in the solar business, in the way Lightsource (has) crafted it, a very attractive business proposition. We see growth in terms of return, cash delivery, and profitability.”

The CEO of Lightsource, Nick Boyle, provided a complement to that line of thinking by noting that: “The beautifully attractive thing about solar is the fact that it creates very predictable long-term revenue streams” — before explaining that long-term PPAs were essentially as “bankable” as government subsides.

Reuters provides more: “BP was the first of the world’s top oil companies to put a focus on energy sources other than fossil fuels two decades ago with an $8 billion investments in renewable energy, using the marketing slogan ‘Beyond Petroleum’. BP, which also has wind power, biofuels, and biopower investments, said it would pay $50 million when the deal was completed and the balance of the $200 million over 3 years.

“BP, which will have 2 seats on Lightsource board, expects the deal to be completed in early 2018. Lightsource were advised by Rothschild, White and Case, Deloitte, and Baker & McKenzie. … Global installed solar generating capacity more than tripled in the past 4 years and grew by over 30% in 2016 alone, according to BP’s Statistical Review of World Energy. BP expects solar to generate about a third of the world’s total renewable power and up to 10% of total global power by 2035.”

As it stands, Lightsource manages around 2 gigawatts (GW) worth of nameplate solar energy generating capacity under various long-term agreements, and a total of 1.3 GW worth of capacity has been commissioned.

This news follows on similar moves made in recent times by BP’s rivals Total and Royal Dutch Shell. Shell, it should be noted, has also been investing a fair amount into electric vehicle charging facilities in recent times.

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James Ayre

James Ayre's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy.

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