TOKYO — Japan’s biggest refiner, Eneos Holdings Inc, said on Monday it would buy Japan Renewable Energy for about 200 billion yen ($1.8 billion) to expand its low-carbon business, joining a list of major global corporate players moving away from climate-changing fossil fuels.
Eneos, which aims to have net-zero emissions by 2040, will buy Japan Renewable Energy from Goldman Sachs and Singaporean sovereign wealth fund GIC.
It said the deal, which marks the first big purchase of a renewables firm by a top Japanese oil company, would help it meet its target to have more than 1,000 megawatts (MW) of renewables in Japan and abroad by March 2023.
Japan’s oil companies have ventured more into the renewables sector, much like their overseas peers such as Royal Dutch Shell, especially after Tokyo vowed to cut down more emissions earlier this year.
Founded in 2012, Japan Renewable Energy develops and builds renewable energy assets and has 419 MW of solar, onshore wind and biomass capacity in operation, with a further 410 MW under construction.
Given its comparatively small capacity, Japan Renewable will be unlikely to make much of an immediate contribution to Eneos’ typical annual sales of around 10 trillion yen ($90 billion).
However, the deal signifies Eneos’ intent to start switching out of fossil fuels. Japan is set to nearly double official targets for renewable supplies in the energy mix of the world’s third-largest economy.
Eneos controls half the market for gasoline and other fuels in Japan, but has for many years seen its customer base shrink due to a declining population and shifting tastes. (Reporting by Chang-Ran Kim and Aaron Sheldrick; Editing by Ramakrishnan M.)