BP (BP.L) aims to spend up to 10 billion euros ($10.7 billion) in low-carbon fuels, renewables, and EV charging in Germany by the end of the decade to compete with local power businesses in Europe’s biggest economy’s energy transformation.
Germany is one of the nations BP wants to build up its fossil fuel transition to low-carbon fuels and power.
BP’s German investment drive focuses on expanding its local EV fast charging network, decarbonizing its refineries, and developing wind power. It is considered a local center for low-carbon hydrogen imports.
“We are talking about refineries, the largest petrol station network in Germany, existing business relationships, and strong brands,” BP Europe board chair Patrick Wendeler told Reuters.
“These are great things we can build on that others don’t have. Those are advantages.”
The 10 billion euros are fresh investments, although BP must pay 678 million euros after winning two offshore wind licenses in Germany’s July auction.
BP will invest $55 billion to $65 billion in its new transition businesses between 2023 and 2030, equaling its oil and gas spending.
After giving up some ground earlier this year, former CEO Bernard Looney told Reuters he would not further cut down his energy transition plan. Looney resigned late on Tuesday in an unexpected move for failing to disclose prior personal ties with coworkers properly.
The investment will test existing power companies striving to compete with oil majors’ financial might.
Visuals from Reuters
BP has employed 4,000 workers in Germany, 6% of its total, via previous firms for over a century.
Wendeler said BP would hire new or retain current experts but would not specify whether the investments would increase the workforce.
BP created a Hamburg office to manage its offshore wind growth.
He said, “And we will have areas where we will consolidate, because the existing energy system is one that is declining strongly,” lowering German crude oil capacity.
Lingen and Gelsenkirchen refineries and Aral, Germany’s biggest fuel station network, are owned by BP. Its Aral brand offers over 1,700 rapid EV loading stations in Germany.
Wendeler said BP wants up to 20,000 charging points by 2030 to capitalize on the rising use of EVs as Volkswagen (VOWG_p.DE) and BMW (BMWG.DE) introduce new models.
BP and TotalEnergies (TTEF.PA) defeated incumbents RWE (RWEG.DE) and Orsted (ORSTED.CO) in Germany’s offshore wind procurement, making headlines. BP will mostly utilize the power for German consumption.
Shell (SHEL.L), Orsted, and RWE have questioned BP’s bid’s economic justification, which it claims would produce 6%-8% returns.
RWE, whose CEO plans to invest 15 billion euros in Germany by 2030, withdrew because the bidding had reached unsustainable levels.
Looney backed the offshore wind proposal, predicting robust renewable energy demand. “Green electrons will be sparse in 2030s. They’ll be scarce and pricey.”
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