Bp has shifted its strategy to slash investment in renewable energy

BP announced Monday (Dec. 9) that it will significantly reduce its renewable energy investments through 2030, while teaming up with Japanese power company JERA to combine the two companies' offshore wind businesses.

The new joint venture, Jera Nex BP, which will be equally owned by both companies, will boost both companies' existing offshore wind projects and create one of the world's largest offshore wind businesses.

The two companies plan to invest up to $5.8 billion by 2030, of which BP will contribute $3.25 billion. This amount is significantly lower than BP's previous plan to invest about $10 billion in offshore wind between 2023 and 2030.

BP chief executive Murray Auchincloss has revamped the group's strategy since taking over in January, scaling back key climate targets and focusing more on its oil and gas business to boost profitability.

BP's move follows the latest announcement by rival Shell. Shell announced that it will no longer develop new offshore wind projects and will split its power division into two interconnected business units.

Offshore wind is seen as one of Europe's key renewable energy sources to decarbonise electricity production, but has been hampered in recent years by rising costs and supply chain issues.

In addition, both BP and Shell recently reported lower profits for the third quarter.