BP to abandon renewables targets - report
By Josh White
Date: Monday 24 Feb 2025
(Sharecast News) - BP is set to abandon its target of increasing renewable energy capacity 20-fold by 2030, it was reported on Monday, shifting its focus back to fossil fuels in response to investor pressure.
According to an exclusive report from Reuters, citing sources familiar with the matter, the change would be formally announced on Wednesday at the company's capital markets day.
The move came as BP struggled with underperformance compared to its industry peers, having already scrapped its previous target of significantly cutting oil and gas output by 2030.
BP had aimed to expand its renewable generation capacity to 50 gigawatts by the end of the decade, up from 8.2 gigawatts currently, but the company would reportedly now forgo that goal.
In addition to scaling back its renewables ambitions, BP was apparently planning to abandon a target of reaching $49bn in core earnings (EBITDA) this year.
Instead, the company would introduce an annual percentage growth target.
Reuters said it also intended to divest assets and reduce low-carbon investments in an effort to cut debt and improve shareholder returns.
The company was also under mounting pressure from activist investor Elliott Investment Management, which had built a near-5% stake in BP and was pushing for a strategic overhaul.
Elliott was reportedly advocating for reduced green energy spending and the sale of assets, including BP's wind and solar businesses.
The hedge fund also saw potential value in divesting BP's Castrol lubricants business and retail fuel network.
BP's shift would be a significant reversal from the strategy introduced in 2020 under former chief executive officer Bernard Looney, who pledged to cut oil and gas output by 40% while expanding renewables.
That target was already revised to a 25% reduction last year, and since taking over, current CEO Murray Auchincloss had slowed renewables investments, cut costs, and reduced staff by 5%.
Analysts at Bank of America were expecting BP to announce cuts of between $2bn and $3bn in annual low-carbon capital expenditures.
BP spent $16.24bn in total capex in 2024.
The firm's investor presentation was originally scheduled for earlier this month in New York, but was moved to London after Auchincloss underwent a medical procedure.
At 1224 GMT, shares in BP were up 0.22% in London at 448.49p.
Reporting by Josh White for Sharecast.com.
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