Two sources have revealed that BP is ditching plans to increase renewable energy generation capacity and refocusing its efforts on fossil fuels. The sources told Reuters that the chief executive is set to scrap the company’s plan to boost green energy generation by 20 times through the rest of the decade, dealing a major blow to the clean energy industry’s growth.
The decision to ditch green energy is reportedly part of a shift in strategy to help BP assuage rising investor concerns about the firm’s earnings. BP shares have struggled to compete with industry rivals for the past couple of years and fell by nearly 16% in 2024 compared to other major players in the oil sector. Furthermore, the firm recently scrapped its target of cutting gas and oil output by the end of the decade.
BP CEO Murray Auchincloss is expected to inform investors of the firm’s intention to ditch its plans to increase its green energy capacity, the two sources say. BP’s earnings report shows that it had a total renewable energy capacity of 8.2 GW compared to 926 megawatts of wind energy in 2019.
According to the two sources, BP also plans to ditch a goal of reaching $49 billion in core earnings (EBITDA) and replace the target with a yearly percentage growth target. However, although BP said that it could get rid of its green energy and earnings targets in a call with analysts, the firm hasn’t made a formal announcement regarding the changes.
The two unnamed sources added that BP will soon inform the public of plans to divest and cut renewable energy and low-carbon-related investments to cut down on debt and boost its earnings. If these sources are right, BP won’t be the first notable energy company to shift from a green energy-focused strategy to their old reliable, fossil fuels, after prices surged from the lows caused by the coronavirus pandemic as well as the Russia-Ukraine conflict.
BP may be abandoning its efforts to increase renewable energy generation to be more in line with U.S. policy as led by President Trump. The Republican is a staunch critic of green energy who has consistently batted for the fossil fuel industry. As a result, the U.S. is swiftly moving away from green energy and may not be in a position to buy renewable energy from energy companies in allied nations like the UK.
While oil and gas firms like BP are ditching their plans to ramp up renewable energy production, entities like Mullen Automotive Inc. (NASDAQ: MULN) are making solid strides in their bids to address the market for zero-emission vehicles. Recent stock market movements for these firms show that investors strongly believe in the utility of these BEVs.
NOTE TO INVESTORS: The latest news and updates relating to Mullen Automotive Inc. (NASDAQ: MULN) are available in the company’s newsroom at https://ibn.fm/MULN
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