BP seeks partnerships to navigate renewables storm

BERLIN/LONDON, Nov 19 (Reuters): BP is seeking partners for offshore wind projects in Japan and may invest in hydrogen technology companies to tackle inflation and equipment bottlenecks that have battered the renewables sector.
The oil major plans to expand in low carbon energy in the coming decades as it seeks a long-term business model that can survive the global transition from fossil fuels. Some investors have criticised the strategy for taking BP's focus from higher returns on oil and gas businesses.
But Anja-Isabel Dotzenrath, who leads BP's renewables business, told Reuters it was "time to deliver" and seeking partners in Japan, one of the markets identified for growth, was part of the solution.
Earlier this month, she said the U.S. offshore wind industry was "fundamentally broken" after BP wrote down $540 million on its wind power projects offshore New York, blaming inflation and red tape that meant projects ran over budget and over time.
Globally, the renewables sector has been undermined by slow permitting, technological challenges, rising raw material costs and higher costs of capital.
BP's renewable partner Norway's Equinor, also took a related $300 million impairment, while Denmark's Orsted, the world's No.1 offshore wind project company, scrapped two local projects and suffered billions of euros of writedowns.
As BP seeks to guarantee it can meet its internal returns target of 6 per cent to 8 per cent on renewables projects, Dotzenrath said BP was working out how to reduce costs globally.