LONDON, Oct 18 (Reuters) - BP is focusing on smaller investments in renewable energy to avoid large losses in the sector like those it suffered earlier in the decade, Chief Executive Bob Dudley said on Wednesday.
BP and peers including Royal Dutch Shell and Total have recognised the need to reduce carbon emissions in the fight against global warming. But their investment in renewables remains tiny compared to the oil and gas businesses.
“We’re making smarter, in many cases, smaller bets, and making more of them across a wider range of technologies and business models,” Dudley said in a speech at the Oil & Money conference.
“Rather than bolting on a whole series of low-carbon businesses, as we have in the past, we’re building low carbon into what we do.”
BP made a number of large investments in solar power, wind farms in the United States, carbon-capturing technology and biofuels in the 2000s under the leadership of John Browne, who sought to rebrand the company as “Beyond Petroleum”.
Some of those investments failed to pan out and BP in 2011 wrote off its solar business. Still, BP is today the biggest wind operator among the world’s top oil and gas companies.
“We continue to invest in those businesses and they’re profitable – but it’s fair to say they don’t - as yet - make a material difference to the bottom line.”
“Through these venturing and partnership activities, we are building our understanding so that we can avoid large speculative investments and instead give ourselves as much optionality as possible to back winners as they emerge.”
Dudley reiterated his call for a global price on carbon emissions, which would make cleaner energies, including renewables and gas, more profitable to develop.
“This time the global commitment to action feels different, and the national pledges are a good start. But frankly we need even stronger and clearer signals to create the confidence to invest in and grow low-carbon businesses at scale.” (Reporting by Ron Bousso; Editing by Dale Hudson)