BP Accelerates Renewable Energy Ambitions with Full Ownership of Lightsource BP

In a strategic move aimed at bolstering its renewable energy portfolio, BP has announced its decision to acquire the remaining 50.03% interest in Lightsource BP, a prominent player in the development and operation of utility-scale solar and battery storage assets worldwide.

The agreement signifies BP’s commitment to harnessing the full potential of Lightsource BP, positioning it for continued growth and heightened performance in the dynamic renewable energy sector. Lightsource BP has established itself with a capital-light business model, focusing on the development, engineering, construction, and farm-down of projects. The company has successfully created value by selling majority interests in its developed assets to strategic partners, boasting a track record of delivering renewable projects with equity returns in the mid-teens.

With this acquisition, BP aims to leverage its complementary capabilities, including financial expertise and trading strengths, to scale up Lightsource BP and unlock additional value. BP will continue targeting double-digit equity returns from the business, aligning with its broader strategy in the renewable energy sector.

Furthermore, BP plans to integrate Lightsource BP’s renowned capabilities as a developer of cost-competitive utility-scale onshore renewable power to meet its growing demand for low-carbon power. This integration is expected to support and de-risk the delivery of BP’s targets for its transition growth engines, encompassing hydrogen, electric vehicle (EV) charging, biofuels, and power trading.

The acquisition terms have been structured and priced to be highly competitive, reflecting prevailing market conditions. The consideration structure is notably biased toward performance, demonstrating BP’s commitment to maximizing value. The company may explore opportunities to bring a strategic partner into the business, unlocking further potential in the future.

This acquisition, fully accommodated within BP’s financial framework, is expected to meet the company’s investment return expectations from renewables and power. Subject to regulatory approvals, the transaction is anticipated to conclude by mid-2024.

Anja-Isabel Dotzenrath, BP Executive Vice President for Gas and Low-Carbon Energy, expressed enthusiasm stating “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.”