Shell Buys Offshore Wind Developer in Renewable Power Expansion Bid
Shell has agreed to buy French offshore wind developer Eolfi SA, continuing its expansion into renewable power.
The oil major is boosting spending on low-carbon energy as it faces pressure to address the risks climate change poses to its business. Shell’s biggest renewable bets so far have been on acquiring retail customers, through the purchase of a UK utility and an electric car charging company.
Eolfi has a foothold in one of the most developed markets for floating wind projects, in the shallow waters off France, which could give Shell the experience and expertise it needs to boost investments in the technology.
“Eolfi has been a pioneer of floating wind development,” said Dorine Bosman, vice president of offshore wind for Shell. “We believe the union of Eolfi’s expertise and portfolio with Shell’s resources and ability to scale-up will help make electricity a significant business for Shell.”
Winning in Wind. By 2030, installed capacity of floating offshore wind could reach 1.2 gigawatts across seven countries, with France becoming the biggest market, according to a forecast from BloombergNEF. So far Equinor ASA has dominated the sector, winning the right to build the world’s biggest offshore wind farm in the UK with partner SSE Plc in September.
The head of Shell’s business unit that includes low-carbon investments, Maarten Wetselaar, said earlier this year he thinks the oil major could become the largest electricity company in the world within 15 years as it pivots away from fossil fuels. Wind will be a key component of that strategy, executives have said.
In January Shell said it’s teaming up with a pension fund to bid for a Dutch utility called Eneco, which focuses on clean power. On Thursday, CFO Jessica Uhl said bids for the company were due within a week. Shell’s overall budget for “new energies” is about $2 billion a year, less than 10% of its capital expenditure budget, though it’s expected to rise to as much as $3 billion by 2021.
Shell didn’t disclose terms for the purchase of Eolfi. The company has more than 65 employees in Paris, Lorient, Marseilles and Montpellier. It has developed over 200 onshore and offshore renewable energy projects in five countries, according to a statement from Shell. The deal is expected to close in December.