In pursuit of achieving net-zero emissions by 2050, Shell plans to expand its global solar portfolio with the purchase of a US solar and energy storage developer, the company said Dec. 14.
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Under the agreement, Shell's renewable and low-carbon energy subsidiary, Shell New Energies, will buy Savion, a Kansas City-based renewable energy company that operates over 130 solar and energy storage projects in various stages of development across 26 states, with a combined capacity of 18 GW. Its customers include utilities and major industrial and commercial organizations, Shell said in a statement.
"As one of the fastest-growing, lowest-cost renewable energy sources, solar power is a critical element of our renewables portfolio as we accelerate our drive to net zero," Shell's Integrated Gas and Renewables and Energy Solutions Director Wael Sawan said in a statement.
Shell will buy Savion, established in 2019, from Macquaire's Green Investment Group and it will become a wholly owned subsidy of Shell operating within Shell's renewable energy subsidiary business.
The purchase is part of Shell's strategy to develop an integrated power business en route to achieving its net-zero goals. The company updated its net-zero target in February after determining that its total emissions peaked in 2018 and oil production peaked in 2019. In October, the company also set an interim 2030 target of 50% carbon emission reductions compared to 2016 levels.
Part of that strategy includes scaling a low-carbon business by the early 2030s on the back of Shell's upstream revenues and returns, the company said in February. Shell said it will rebalance its portfolio by annually investing between $2 billion and $3 billion in renewables, $3 billion in marketing, $4 billion in integrated natural gas, up to $5 billion in chemical products and around $8 billion in its upstream sector. The Savion purchase will use dollars from its $2 billion to $3 billion fund for renewables.
Shell's integrated power business aims to sell 560 TWh of electricity by 2030 and serve more than 15 million retail and business customers worldwide, the company said.