BP Moves to Join US Retail Power Market

UK-based major BP is expanding into retail power markets in the US, following Total and Royal Dutch Shell into the highly regulated business of selling power rather than simply generating it. BP filed an application with the US Federal Energy Regulatory Commission (FERC) requesting permission for subsidiary BP Energy Retail to market power directly to consumers in five US states: Illinois, Ohio, Texas, California and Pennsylvania. “BP Energy Retail is a retail energy marketing company that intends to sell electricity products directly to commercial and industrial customers and residential customers,” the filing states. BP has been rapidly expanding its renewable power generation portfolio from the 3.3 gigawatts it had at the end of 2020 to a goal of 50 GW by 2030 (IOD Sep.14'20). However, until its latest filing, BP’s strategy called for selling that power in large increments through power purchase agreements -- either to industrial-scale businesses such as Microsoft and Amazon and large cities like Houston and Aberdeen, or to power retailers that would sell it to smaller customers. BP is already the largest US natural gas trader and a sizable producer, and executives said they saw an opportunity to bundle up gas and power supplies to large consumers looking for a greener mix of power options. Through other subsidiaries, BP holds stakes in wind farms in several US states including Indiana, Pennsylvania, Kansas, Colorado and Wyoming, with total capacity of around 1.7 GW. The company also owns a solar farm in Colorado with capacity of 240 megawatts and a natural gas cogeneration plant with capacity of 525 MW. Assuming it is approved, the FERC filing would pave the way for BP to integrate its power business from generation to providing energy for smaller customers, joining fellow European majors Shell and Total in the practice (IOD Feb.23'21). However, they have focused their retail power businesses in Europe, with Total concentrating in France and Shell in the UK. Neither have yet entered the US market. BP declined to comment on the FERC filing. Noah Brenner, London