BASF to launch new renewable energy subsidiary

German chemicals company BASF is bundling its activities in renewable energies under the umbrella of a new subsidiary, BASF Renewable Energy GmbH, starting in January 2022.

The wholly-owned subsidiary will focus on supplying the BASF Group in Europe with renewable energy, power trading activities in Europe and providing consultation for BASF and its companies in the field of renewable energies.

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The company is based in Ludwigshafen and will be managed by Horatio Evers, who was previously responsible for the development of renewable energies at BASF SE.

BASF expects that by gradually replacing electricity from fossil generation, from own production as well as purchase agreements, and scaling innovative, climate-friendly technologies to an industrial scale, its electricity consumption in Europe will increase from the current annual level of around 9 terawatt-hours from fossil fuels to the point where at least three to four times as much electricity from renewable sources will be needed to reach the net-zero goal.

BASF Renewable Energy GmbH is tasked with supplying the European sites with these additional volumes in line with demand. To this end, it will initiate new additional projects to generate renewable energy from its own production together with partners and conclude long-term supply agreements with energy producers, known as Power Purchase Agreements (PPAs).

“As the leading company in the chemical industry, we are already one of the largest industrial electricity consumers in Europe. Due to the conversion to renewable energy as well as the launch of new, low-emission production processes based on electricity, our demand will increase significantly in the future,” said Evers. 

Read more: High energy prices show need for green transition, says EU's Timmermans

“The reliable and efficient supply to BASF with sufficient quantities of electricity from renewable sources at competitive prices is necessary for the implementation of our goals and the achievement of the targeted climate neutrality. We are committed to a make-and-buy strategy in this regard.”

BASF has set a target to reduce its greenhouse gas emissions by 25% by 2030 compared with 2018 and to achieve net-zero emissions by 2050.

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