Suncor Energy Inc. is divesting its solar and wind assets, turning its focus instead to hydrogen and renewable fuels.
The decision to ditch its renewable power assets spells the end of a two-decade foray into wind and solar for the Calgary-based company, which in 2002 partnered with Enbridge Inc. to build one of the first renewable energy projects in Canada. Since then, Suncor has developed eight wind power projects across Saskatchewan, Alberta and Ontario.
Monday’s announcement is the company’s second major portfolio overhaul plan to be released in recent months.
Earlier this year, it said it was planning to shed its Norway exploration and production assets and sell its Rosebank interest in the UK North Sea. It expects to close on those deals later this year.
Suncor president and chief executive Mark Little said in a statement Monday evening that divesting from wind and solar would bring more “fit and focus” to the company’s asset portfolio.
He added that doing so would drive shareholder returns and help the company meet its emissions reduction targets, including bringing greenhouse gas emissions to net-zero by 2050.
Specifically, it is focusing on efforts that are complementary to its base oil and gas business.
That includes replacing boilers at its oil sands Base Plant facility with lower-emission units, accelerating the commercial scale deployment of carbon capture technology, and partnering with energy company ATCO Ltd. to build a new hydrogen project in Alberta.
It is dabbling in renewable fuels, too.
Suncor has invested millions of dollars already in Lanzajet, which has developed a sustainable aviation fuel, and Enerkem Alberta Biofuels, whose Edmonton plant is the first commercial-scale facility in the world to turn non-recyclable, non-compostable mixed municipal solid waste into cellulosic ethanol, a popular biofuel.
Suncor said Monday that despite the sale it will still play in the electricity space, including producing power through co-generation operations that use natural gas to produce industrial steam and electricity, and providing customers with EV charging.
It said it may also procure renewable power through power purchase agreements, in which a company or institution agrees to purchase electricity directly from a green energy generator. Power generated on the site feeds back into the grid, offsetting the amount of electricity consumed by that company.
The arrangements are a growing trend in Canada as more companies try to reduce their carbon footprints.
Suncor told The Globe and Mail in an email Monday night that it plans to sell its interests in the Magrath, Chin Chute and Adelaide wind farms, along with renewable power projects under development such as the Forty Mile Solar installation in Alberta.
The Forty Mile project is an expansion of a wind installation that restarted construction in April 2021. The proposed 220 megawatt solar project, to be located on privately owned land in Alberta, was scheduled to be operational later this year.
Suncor told The Globe that the marketing process for its renewable power assets will begin immediately, followed by a formal sales process.
Suncor’s announcement came the same day as the release of a new report by the UN climate science panel, which said the world must rapidly accelerate its transition away from coal and other fossil fuels to avoid extreme climate change.
With a report from Reuters
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