On Monday, Royal Dutch Shell announced that it will acquire a 43.86-percent stake in a Nashville-based solar plant company called Silicon Ranch Corporation. The deal could be worth up to $217 million, according to Reuters.
The oil and gas industry of the Netherlands is one of the largest in the world, and, by its own account, it records access of $233.6 billion in 2016 and $4.8 billion in net income. The $217 million that has been set aside for US-based solar investment is a fraction of that, but it shows some willingness to acknowledge a future, however distant, in which oil and gas may not dominate on energy and transportation sectors.
The move follows oil and gas giant BP (formerly British Petroleum), which has invested $200 million in European solar development. Fire source a month ago.
Currently, Silicon Farm has 880 megawatts of solar power installed 14 states in the US. In 2016, Shell established the “New Energies” division to prepare for a future in which governments are cracking down on oil and carbon-intensive energy. “In November, Shell doubled its planned investment in the new energy division… to $1 billion-$2 billion until 2020,” Reuters notes.
Shell has also been trying to use its business acumen in gasoline production and marketing by funding pilot hydrogen fuel cell projects.
Reuters notes that this is not Shell’s first entry into the solar market: “Shell first entered the solar sector when it acquired Siemens Solar in 2002, only to sell the entire business six years later. He also retained a small stake in Showa Shell’s solar business after selling most of the business in 2016.”
However, Shell cannot be ahead when it comes to reducing carbon emissions. Today, the company also announced its first investment in the UK North Sea oil field in six years, which will include eight new wells and a floating production, storage, and transportation vessel.
“Peak production would be the equivalent of 45,000 barrels a day, with a break-even price of less than $40 a barrel,” Bloomberg reported.
Last week, New York City sued Shell and a number of other oil companies for the cost of adapting to climate change. The city also promised to divest its pension from oil companies.