EDP, the Portuguese energy giant, is making bold moves to reshape its portfolio and accelerate its decarbonisation strategy. The company has signed an agreement to sell its remaining 20% stake in Pecém Geração de Energia, the operator of the Pecém coal plant in Brazil. This 0.20bn reais ($35.4m) deal marks EDP’s complete exit from coal-fired power in the Brazilian state of Ceará, a significant step in its journey towards a greener future.
The Pecém complex, sprawling over 17,000 hectares, is more than just a coal plant. It’s a sprawling industrial hub with the infrastructure to host new ventures. EDP has been strategically divesting from this complex, having sold 80% of its stake to a consortium led by Mercurio Asset at the end of 2023. The sale of the remaining stake is a clear signal of EDP’s commitment to its decarbonisation goals.
But here’s where it gets interesting. Despite exiting the coal segment, EDP is not abandoning the Pecém complex entirely. The company will maintain full control over a renewable hydrogen project within the same complex. This project isn’t just a pipe dream; it’s already produced the first molecule of green hydrogen in December 2022, a milestone for both EDP and Brazil. This move underscores EDP’s seriousness about transitioning to cleaner energy sources.
EDP’s strategy isn’t just about divesting from coal; it’s about investing in the future. The company is pursuing energy conversion plans across its facilities in Brazil, Portugal, and Spain. It’s also pouring resources into developing sustainable energy solutions, with a particular focus on green hydrogen. This isn’t just about reducing emissions; it’s about leading the energy transition.
But EDP’s ambitions don’t stop at hydrogen. In a surprising move, ENGIE Brasil Energia signed an agreement with EDP to acquire two hydropower plants in northern Brazil for 2.9bn reais. This deal, expected to close in March 2025, shows that EDP is open to strategic partnerships and isn’t afraid to shake up the market.
So, what does this all mean for the energy sector? EDP’s moves could accelerate the decarbonisation of the energy mix in Brazil and beyond. Other companies might follow suit, divesting from fossil fuels and investing in renewables. But it’s not just about following trends; it’s about setting them. EDP’s focus on green hydrogen could spur innovation and investment in this promising sector. The company’s willingness to partner with competitors shows that collaboration, not just competition, will drive the energy transition. The energy sector is watching EDP closely, and for good reason. The company is not just adapting to the changing energy landscape; it’s helping to shape it.