Brookfield signs green power supply deal for new BASF plant in China
May 10 (Renewables Now) — Canada-based Brookfield Asset Management Inc (TSE:BAM.A) will develop and build solar and wind power plants to supply green energy to a major chemical production site that the German giant BASF SE (ETR: BAS) is building the Chinese coastal city of Zhanjiang.
The two companies announced on Tuesday that they had signed a term sheet for a 25-year power purchase agreement (PPA) with a fixed cost mechanism. Pricing for green energy projects to be developed is based on the levelized cost of energy concept.
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In addition to renewable energy plants, the agreement also includes an option for energy storage solutions.
“BASF is dedicated to making its Zhanjiang Verbund site a model of sustainable production and is already aiming to achieve 100% renewable electricity supply for its Zhanjiang Verbund site by 2025. This is part of the neutrality goal BASF’s climate change and will also contribute to China’s carbon reduction goal,” said Haryono Lim, Senior Vice President, New Verbund Site China.
The Zhanjiang Verbund site, with an investment of between 8 and 10 billion dollars (9.47 billion euros), will be BASF’s third production site after the plants in Ludwigshafen, Germany, and Antwerp, in Belgium. The Ludwigshafen-based chemical producer plans to complete the entire Verbund site by the end of the decade.
(1 USD = 0.947 EUR)