Equinor will allocate more than half of its annual gross capital expenditure to renewables and low carbon solutions by 2030, as part of actions detailed in its first energy transition plan.
The plan provides an overview of how the company is progressing towards its 2050 net zero ambition through short-term actions and medium-term ambitions.
The plan outlines Equinor’s ambition to have a total of 12-16GW of installed net renewable capacity by 2030, five years earlier than previously announced.
The company has already accessed around two thirds of our growth ambition through a “competitive and high-quality” pipeline anchored by the Dogger Bank and Empire and Beacon Wind offshore projects in the UK and US.
“As we execute on these world-class projects, we are well positioned to grow our presence in markets where we look to continue to create value and optionality,” Equinor stated.
Throughout its expansion into renewables, Equinor will continue to be guided by a focus on capital discipline, value creation and delivery.
Based on its outlook, Equinor plans to allocate around $23bn gross capex to renewables between 2021 and 2026 and expects a real base project return of 4-8%.
In addition to investments in offshore wind, the company is expanding into other areas of the renewable energy, including equity ownership stakes in Scatec, a renewable power producer, and Noriker Power, a UK-based battery storage developer focussed on utility scale storage.
Equinor Ventures has a mandate of $750m, with more than 50% of the fund’s capital being deployed towards renewables and low carbon activities by 2025.
The portfolio comprises more than 40 investments, with an almost even split between oil and gas, and renewables and low carbon solutions.
In 2021 Equinor started a separate reporting segment for its renewables unit to recognise its strategic importance and materiality.
In 2021, capital gains from renewables was $1.4bn, a more than seven-fold increase from 2020, resulting primarily from profitable asset farm-downs.
The plan will be submitted for an advisory vote by shareholders at the company’s 2022 Annual General Meeting on 11 May.