BP Sells 1.7GW U.S. Wind Business to LS Power for 20% Oil Focus

BP has announced the sale of its U.S. onshore wind business to LS Power, a New York-based renewable energy developer. This move is part of BP's broader strategy to divest from renewable energy assets and focus more on fossil fuel production. The sale, which was announced on July 18, includes ownership stakes in 10 U.S. wind farms with a combined gross capacity of 1.7 gigawatts, enough to power approximately 1.3 million homes.

According to William Lin, BP's executive vice president for gas and low-carbon energy, the decision to sell the onshore wind business aligns with BP's new strategy of simplifying and focusing its portfolio to generate value. Despite the quality of the assets and the workforce, BP has concluded that it is no longer the best owner to advance this business. This divestment is part of BP's plan to sell about $20 billion in assets through 2027, including up to $4 billion in 2025, and to increase its investment in oil and gas production by nearly 20% per year.

BP's recent divestments include the sale of its network of 300 fueling stations in the Netherlands to the Dutch business Catom, and plans to sell its retail fueling business in Austria. Additionally, BP is divesting a 50% stake in its Lightsource solar business and selling much of its global offshore wind business through a new joint venture with Japanese utility JERA. BP has also sold a $1 billion stake in the TANAP gas pipeline from the Caspian Sea to Apollo Global Management and is conducting a strategic review of its Castrol lubricants business, which is estimated to be worth close to $8 billion.

BP's decision to divest from renewable energy comes amid financial challenges and increased investor activism. The company's stock performance has been struggling, and it has faced pressure to cut costs and focus on core operations. The sale of the U.S. onshore wind business to LS Power is expected to close by the end of 2025. LS Power, which has a 21-gigawatt portfolio of power, will operate the BP assets under its Clearlight Energy portfolio company. The deal includes wind farms in several states, with the largest footprints in Indiana and Kansas.

LS Power's CEO, Paul Segal, highlighted the significance of the acquisition, stating that it represents a major investment in reaching the company's goal of developing a cleaner, more reliable, and affordable energy ecosystem. The renewable energy business in the U.S. is facing additional challenges due to the opposition to wind and solar power from the Trump administration, including the rapid phasing out of tax credits for clean energy construction through the president’s new mega-spending legislation. However, LS Power's acquisition of BP's wind farms is a significant development in the renewable energy sector, demonstrating the company's commitment to solving complex energy problems and improving the world.