Canadian integrated energy company Suncor has agreed to sell its wind and solar assets for C$730 million (~$537.61 million) to Canadian Utilities, an ATCO company.

The acquisition includes a diversified operating portfolio of wind assets, including the new 220 MW Forty Mile wind project in Alberta, which is expected to be operational by the end of this year, and a majority interest in the Adelaide wind project with 40 MW capacity in Ontario.

The offtake from the Adelaide project is contracted under a long-term power purchase agreement.  ATCO is in contract discussions with credit-worthy counterparties on the Forty Mile project.

ATCO has also secured a development pipeline with more than 1.5 GW of wind and solar projects at various stages of development, including several late-stage projects.

Suncor will focus on energy expansion, hydrogen, and renewable fuels, as the company progresses toward its goal of net zero by 2050.

“Divesting of these wind and solar assets further streamlines our portfolio so that we can concentrate our efforts on our core business,” said Kris Smith, Suncor Interim President, and Chief Executive Officer.

“Our ESG efforts will continue to advance in other areas that are complementary to our core business, such as replacing coke-fired boilers at Base Plant with lower emission cogeneration units, investing in hydrogen and low-carbon fuels, and accelerating commercial-scale deployment of carbon capture technology,” added Smith.

Suncor is developing petroleum resources while advancing the transition to a low-emissions future through investment in power, renewable fuels, and hydrogen. It also conducts energy trading activities focused principally on the marketing and trading of crude oil, natural gas, by-products, refined products, and power.

The transaction is expected to close in the first quarter of 2023 and is subject to customary closing conditions, including applicable third-party regulatory reviews and approvals. The purchase price is subject to closing adjustments.

In 2021, Suncor Energy partnered with ATCO on a clean hydrogen project with global scale-up potential. The project was expected to produce more than 300,000 tons per year of clean hydrogen using advanced technology to capture more than 90% of the emissions generated in the hydrogen production process.

Early this year, ATCO Group, through its investment in Canadian Utilities, entered into a 15-year power purchase agreement with Microsoft Corporation. Under the agreement, Microsoft will purchase all renewable energy generated by ATCO’s Deerfoot 37 MW solar facility in Calgary, Alberta.