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Shell Teams Up With Eneco to Build Two Dutch Wind Farms

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Royal Dutch Shell plc (RDS.A - Free Report) is set to collaborate with sustainable energy provider Eneco Holding and contractor Van Oord in a bid to construct two wind farms off the Dutch Coast. The tender for the wind farms just closed yesterday. Notably, the farms are expected to have a total capacity of 750 megawatts (MW) as Netherlands seeks to increase its offshore wind capacity by 7,000 MW between 2024 and 2030.

The move is in line with Shell’s objective to boost its renewable power business. The company is also contemplating the acquisition of Eneco. Notably, the Anglo-Dutch giant teamed up with pension fund manager PGGM to place a joint bid for the Eneco buyout to ramp up its renewable foothold.In fact, the company will invest up to $2 billion annually through 2020 in its New Energies division, which will also serve as a hedge for soft gasoline and diesel fuel demand.

The company has been on renewable acquisition spree of late, having collaborated with IONITY, New Motion, First Utility and Silicon Ranch as it attempts to diversify its portfolio beyond oil and gas. Shell is also set to acquire sonnen and Cleantech, emphasizing its increasing shift toward lower-carbon fuels. It has pledged to lower carbon emissions by 50% over the next five decades via sharpening its focus on renewable and biofuels.

Shell’s New Energies division has also made investments in U.S. thermal storage specialist Axiom Energy, microgrids and distributed energy services player GI Energy plus hydrogen compression specialist HyET. Shell currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In fact, amid climate change concerns, other big oil companies like TOTAL SA (TOT - Free Report) , Equinor ASA (EQR - Free Report) , BP plc (BP - Free Report) , Exxon Mobil Corporation and Chevron Corporation have also started reorienting their strategies to de-carbonize the energy system by changing gears to alternative fuels.

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