BP Solar exiting the solar panel manufacturing industry has seen India’s Tata Power acquire full equity in Tata BP Solar – but what will happen to BP’s major Australian project, Moree Solar Farm?
Last week, Bloomberg reported BP Solar would wind down its PV unit over the next few months as it had become unprofitable. Far from being a new player jumping on the solar bandwagon only to jump off again like some other oil companies; BP Solar had been operating for 40 years.
At that point, BP’s joint solar venture in India with Tata Power Co. was conducting “business as usual,” according to Tata BP Solar India Ltd’s chief executive.
However, in the last couple of days Tata Power has announced it will purchase 51 per cent equity and preference shares in Tata BP Solar and on completion of the transaction, Tata Power will own 100 per cent of the company. Tata BP Solar has a 125MW solar module manufacturing capacity.
India isn’t the only country where BP Solar has major joint ventures.
BP Solar along with partners Fotowatio Renewable Ventures (FRV) and Pacific Hydro applied for funding under Australia’s Solar Flagships program. The application was successful and in June this year, the Government announced the consortium was chosen to develop Australia’s first utility-scale solar PV project – Moree Solar Farm. The consortium has received commitments of close to $400 million in Government funding so far for the $923 million project.
So, what happens now?
Another Bloomberg report states the company will stick with the project. However, according to a Sydney Morning Herald article, the issue with BP Solar’s exit from the industry aside, the Mooree Solar Farm consortium is yet to sign power-supply agreements needed to advance with the project and have failed to meet a December 15 deadline to reach a financial close.
When this aspect came to light recently, at around the same time the company announced its exit from the industry, BP Solar’s Jamie Jardine told the Moree Champion the delay in locking down agreements was expected and “The project remains on schedule with construction set to begin at the second half of 2012”.
