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bp has successfully secured the rights to develop two offshore wind projects through the German tender round, signifying its debut in offshore wind ventures in continental Europe.
Situated in the North Sea at distances of approximately 130km and 150km offshore, with water depths around 40m, these two sites boast a combined potential generating capacity of 4GW. These projects would mark the company’s initial foray into offshore wind development in Germany once it secures the permits and approvals. Moreover, they align with bp’s integrated energy company strategy and its commitment to prudent capital allocation. bp will take charge of the development, construction, and operations of these fixed-bottom offshore wind projects, aiming to connect them to the grid by the end of 2030. With this, bp’s worldwide offshore wind pipeline will be 9.2GW net to bp.
The recent tender is in line with Germany’s objective of installing 30GW of offshore wind projects by 2030, aiming for a minimum of 40GW by 2035 and a minimum of 70GW by 2045.
As of date, bp has an offshore wind pipeline, in collaboration with joint venture partners, that holds a potential generating capacity of up to 5.2GW net to bp. These projects are in various stages of development, including those off the US east coast and in the Irish and North Seas in the UK. Furthermore, bp has established a strategic partnership with Marubeni in Japan and recently acquired a controlling interest in a portfolio of four potential projects in South Korea.
Anja-Isabel Dotzenrath, bp’s executive vice president, gas and & low carbon energy, said,“These awards are a huge milestone for bp’s decarbonization plans in Germany and are a strong reflection of our wider strategy. The renewable power we aim to produce will anchor the significant demand we expect for green electrons for our German operations, from a whole host of products and services including green hydrogen and biofuels production, electric mobility growth and refinery decarbonization.
She further added, “Germany is a core market for bp and we are excited to continue and grow our business here. The investment is fully aligned with our integrated energy strategy and is accommodated within our disciplined capital frame. Expected returns of 6-8% are consistent with our renewables and power growth engine on an unlevered basis, with the potential to realise enhanced value through integration across the Germany value chain.”
By July 2024, an initial sum of €678 million, 10% of the bid amount, will be disbursed. The remaining 90% will be disbursed over 20 years once the projects commence operations within the next decade.
For almost 120 years, bp and its predecessor companies have been actively present in Germany, contributing to the nation’s energy landscape. At present, the company employs approximately 4,000 individuals within the country. bp operates two refineries in Germany and is notably associated with Aral, which stands as the country’s foremost retail network with around 2,300 sites. bp also holds a significant position in the market of electric vehicle (EV) fast-charging, offering 1,500 charging points throughout the country.
bp’s head of country, Patrick Wendeler, added, “We are investing massively in Germany’s energy transition and in our own – from renewable power generation to having an impact on the decarbonization of road transport to the decarbonization of our refineries. Our major existing businesses here are transforming – powered by green hydrogen, biofuels and offshore wind. And today’s win accelerates the pace of change as we look to do more. We look forward to the important role we can play in contributing to Germany’s energy transition and its efforts to become climate neutral in 2045.”
