Shell plc SHEL enters an accord to acquire RISEC Holdings, LLC, through its subsidiary Shell Energy North America (“SENA”). Per the agreement, SENA will acquire a 609-megawatt (MW) two-unit combined-cycle gas turbine power plant in Rhode Island, United States, which will help the company secure a long-term energy supply for Shell in the deregulated New England power market. SENA, already a recognized player in this market with an energy conversion agreement with RISEC since 2019, will further strengthen its position with this new acquisition.

Shell’s Position in the New England Power Market

Due to growing decarbonization efforts, the demand for energy in the ISO New England market is set to increase. Therefore, Shell’s acquisition positions it well to provide reliable energy in this scenario and capitalize on its existing trading portfolio through its strong knowledge of the plant’s performance.

According to the company, this acquisition will open new trading opportunities and will add value to Shell’s trading portfolio while securing a strong position in the market. The cost of the acquisition will be covered by the existing cash capital expenditure guidance of the company without further increasing its capital expenditure. The acquisition is expected to close by the first quarter of 2025, subject to approvals by regulatory bodies, and promises a high internal rate of return.

Combined-Cycle Technology Leading to Reduced Emissions

RISEC’s combined-cycle gas turbine power plant uses gas turbines to generate electricity, which captures waste heat to produce steam, thereby leading to reduced emissions. This technology complements renewable energy sources like wind and solar, and provides reliable and secure power on demand.

SHEL is committed to providing sustainable energy solutions by transitioning toward cleaner energy sources.

Two other energy majors leading the energy transition race are BP plc BP and Eni SpA E.

BP is seeking to capitalize on the global economy's transition to lower-carbon fuels. Apart from focusing strongly on oil production growth, the company has been investing in renewable energy businesses with a plan to ramp up capital spending for non-oil and gas businesses. BP has plans to become carbon-neutral by 2050.

Eni has been building a full set of decarbonized products and services for clients to achieve carbon neutrality by mid-century. Even though the energy business scenario is challenging, Eni’s efficient exploration keeps it highly competitive.