BP is to acquire the remaining interest in solar developer and operator Lightsource BP.
The oil and gas major will acquire the remaining 50.03% interest in Lightsource BP, following the parties agreeing that “now is the right time” for BP to take full ownership.
Lightsource BP operates with a proven capital-light, develop, engineer, construct and farm-down business model that creates value through selling majority interests in assets it has developed to strategic partners.
With this capital-light model, it has built a track record of delivering renewables projects with equity returns in the mid-teens.
Full ownership will now enable BP to further scale up Lightsource BP and create additional value by applying BP’s complementary capabilities and strengths, including in finance and trading, fully to the business.
BP will continue to target double digit equity returns from this business.
In addition, BP intends to use Lightsource BP’s “world-class” capabilities as a developer of cost-competitive utility-scale onshore renewable power to help meet its own demand for low carbon power.
This integration is expected to underpin and de-risk delivery of BP’s targets for its transition growth engines in hydrogen, EV charging and biofuels as well as in power trading.
Subject to regulatory approvals, the transaction is currently anticipated to close in mid-2024.
Anja-Isabel Dotzenrath, BP executive vice president for gas and low-carbon energy, said: “This is a natural evolution of the partnership we have built over the past six years – now we will be able to take Lightsource BP to the next level of profitable growth and performance.
“We will continue to scale this successful business, and also apply its capabilities and expertise to help meet bp’s growing demand for low carbon power from our transition growth engines.
“I look forward to welcoming the Lightsource BP team to BP and am confident that together we can further strengthen its position as a leading global renewables developer.”