Shell takes half-share in solar power developer
Energy giant Shell has bought a 49 per cent stake in Australian solar power developer Esco Pacific.
Energy giant Shell has bought a 49 per cent stake in Australian solar power developer Esco Pacific, boosting its exposure to renewable energy on the nation’s east coast.
The strategic partnership between the two companies will accelerate development of Esco’s 1000 megawatt pipeline of projects, which cover a string of solar farms spread through Queensland, NSW and Victoria.
Esco has developed 500MW of projects since 2017 and operates a further 350MW under a long-term management arrangement where it is targeting further growth.
Shell is best known in Australia for its LNG projects in Queensland and Western Australia but is now increasingly pushing into the electricity sector on the east coast.
This includes a $620m takeover of Trevor St Baker’s ERM Power in August.
While Shell’s earnings are dominated by oil and gas currently, it wants to gradually shift the weight of its investment dollars to lower-carbon sources to reflect its prediction the energy system will rely much more on electricity rather than fossil fuels for its generation.
“Today’s announcement of Shell’s investment in Esco Pacific, coupled with the recent acquisition of ERM Power, supports a pathway for Shell to supply more and cleaner energy to utility, commercial and industrial customers in Australia,” outgoing Shell country chair Zoe Yujnovich said on Monday. “As the energy mix shifts in the years ahead, Shell intends to grow with the creation of a material integrated power business.”
The Anglo-Dutch company has previously flagged its intention to invest in Australian solar plants that can switch to gas when needed to deliver baseload power supply.
Shell is also weighing an investment decision on its own 120MW solar plant in Queensland’s Western Downs region subject to planning and environment permits.
“Shell can confirm it is investigating the feasibility of a solar energy project on its land near Wandoan in the Western Downs region of Queensland, as part of a plan to deliver energy solutions to meet customer demand,” a Shell spokesperson said.
“The project is subject to a final investment decision by Shell and involves ongoing community consultation.”
Shell is one of the dominant players in Australia’s booming energy sector, operating the QCLNG export plant in Queensland and the Prelude floating LNG project off northern Australia. It has stakes in Western Australia’s North West Shelf, Gorgon, Browse and Sunrise LNG ventures and gas business Arrow.
Australia has been identified as one of six target markets where Shell will look to create a fully integrated electricity supply business with the potential to scoop up a “mass market” customer base through deal-making.
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