Exxon has been slow to follow big oil rivals such as Royal Dutch Shell and BP into renewable energy technologies
Exxon Mobil has been looking to buy renewable energy for delivery in Texas, according to people familiar with the matter.
The company sent out a request for proposals with a June 8 deadline, inviting solar or wind power suppliers to pitch contracts that would last 12, 15 or 20 years, according to a document obtained by Bloomberg and the people who asked not to be named.
Exxon is seeking at least 100 Mw and would consider proposals for more than 250 Mw.
“I have never seen an oil and gas company doing a corporate PPA anywhere near that size,” said Kyle Harrison, a New York-based analyst at Bloomberg NEF, referring to the power purchase agreements used to buy electricity. “If you’re seeing the biggest oil and gas companies going out and making investments in clean energy, it shows that renewables are cost-competitive. This can be a way for them to show a commitment to sustainability without suffering economically.”
Exxon declined to comment. It’s not clear whether the company has reached an agreement with any supplier to buy this power, nor whether it was seeking the electricity for its own use.
Exxon has been slow to follow big oil rivals such as Royal Dutch Shell and BP into renewable energy technologies. While CEO Darren Woods acknowledges the “risk of climate change” and is testing whether biofuel made from algae can work on an industrial scale, he had earlier this year said the company’s investment dollars will follow oil magnate John D Rockefeller’s bet-on-what-you-know mantra.
But as the price of renewable power declines, it may see the value in consuming wind or solar, even if it eschews producing that kind of energy. Texas is the biggest wind-producing state, with power prices occasionally going negative on windy days, and solar is cheaper than coal in many parts of the world.
The number of companies contracting to buy renewables continues to expand. Excluding utilities, companies and agencies agreed to buy 7.2 gigawatts of clean energy worldwide through July, shattering the record of 5.4 gigawatts for all of 2017, according to BNEF.
“Good to see them dipping their toe in the water, but we’ll have to wait to see if they put their foot in the water,” said Amy Myers Jaffe, a senior fellow for energy and the environment at the Council of Foreign Relations in New York.
Source: bloomberg
