Parameters: Shells Oil Corporation Invests In Renewable Energy Infrastructure

Source: Offshore Winds

Over the last few years, various corporations have started to divest from investments into the fossil fuel industry.  Additionally, bits and pieces of news have surfaced over the same years suggesting that big oil companies are following suit.  Chemical & Engineering News reports briefly that another large investment has occurred with the following story shown below:

Shell will buy a 43.8% stake in the U.S. solar developer Silicon Ranch from private investment firm Partners Group for $217 million. With the move, Shell joins other European oil majors that are looking to renewable energy to diversify their future sources of revenue.

“With this entry into the fast-growing solar sector, Shell is able to leverage its expertise as one of the top three wholesale power sellers in the U.S., while expanding its global new energies footprint,” says Marc van Gerven, Shell’s vice president of solar. Silicon Ranch builds and operates large-scale solar installations on behalf of electric cooperatives, corporations, and the military. The company says it has 880 MW of projects underway in 14 states and a development pipeline of 1 gigawatt. Shell’s move comes four months after France’s Total bought a 23% stake in the solar and wind energy producer EREN RE for $285 million. Total also owns a majority stake in the solar panel maker SunPower. In 2010, the British oil company BP famously shuttered its solar power business, claiming it was unable to make profits manufacturing solar panels. The company closed all of its solar manufacturing facilities and laid off 1,750 workers. But in December 2017, BP returned to the sector, buying a stake in the solar project company Lightsource for $200 million. “We’re excited to be coming back to solar, but in a new and very different way,“ said BP CEO Bob Dudley at the time. The U.S. continues to be a hot market for large solar projects. According to market tracking firm GTM Research, about 8.1 GW of utility scale installations were deployed in 2017. The company expects new U.S. installations to dip to 6.5 GW this year before rebounding to 9.0 GW in 2019. The new U.S. tax bill preserves previously threatened tax credits for wind and solar energy production. Shell’s solar investment is a drop in the barrel compared to its profits from oil and gas extraction. Despite low average oil prices of $52 per barrel, the company’s 2017 third-quarter earnings were $4.1 billion.

Wow.  Although, this should not be surprising given a previous blog post I wrote last year regarding a massive reinvestment in renewable energy.



The world is moving toward renewable energy sources.  More broadly, the public is moving (in demand) toward 'greener chemicals' in their consumer products.  'Green chemicals' are chemicals or chemical processes which reduce the amount of toxic chemicals.  Recently, with the movement toward renewable sources of energy, the chemical industry along with other industries have been under pressure to adhere to more sustainable (safe and environmentally friendly) processes and products to market.



Conclusion...


Ultimately, the news above is not too surprising given the direction the world is headed in the next few decades.  Past blog posts have reinforced the information above which suggest that increasingly further industries are starting to transition toward incorporating renewable resources into their infrastructure.  With this being said, this also contributes to the surprise of industry experts (and lobbyists on the whole) when hearing of 'rolling back' Obama era climate policies.  Industries are heavily invested in transitioning toward a more sustainable future -- which includes renewable energy.



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