Bayer agrees 1.4 TWh renewables off-take deal in US

German chemical and pharmaceutical group Bayer AG (ETR:BAYN) has signed a long-term deal to procure 1.4 TWh of renewable power per year from assets to be built in Idaho and use it to power the group's US business.

A long-term structured renewable energy credit (REC) purchase agreement was inked with Idaho-based independent power producer (IPP) Cat Creek Energy (CCE) which will develop the renewable energy projects.

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In addition to the clean power generation plants, the deal includes also 160 MW of nameplate battery storage capacity.

Construction is set to begin in the third quarter of 2023.

The agreed supply corresponds to the consumption of 150,000 households and will help the German group cover 60% of its US-purchased power demand with renewable energy. Thanks to the deal, Bayer will cut its annual carbon dioxide emissions by 370,000 tons.

The purchase of renewable power plays a key role in the sustainability strategy of the Leverkusen-based group which seeks to reach climate neutrality in its operations in 2030. By then, it aims to procure only renewable electricity.

The German major has been operating phosphate mining assets and an energy-intensive processing plant in Soda Springs, Idaho since the Monsanto takeover. The phosphate is used for the production of crop protection products such as weed killer glyphosate.