The world’s largest private-sector coal company is bowing to the times and embracing renewable energy for some of its old mining sites.
Peabody Energy is launching a new company called R3 Renewables LLC, pursuing development of solar and battery storage capacity in near-term projects. The R3 joint venture is teamed with financial firms Riverstone Credit Partners and Summit Partners Credit Advisors.
"We are pleased to announce this new joint venture as part of Peabody's commitment to be the coal producer of choice, creating additional value from our existing assets, supporting our own and our customers' ESG ambitions and providing added economic benefits for the communities in which we work and live," said Jim Grech, President and CEO of Peabody. "Both Riverstone and Summit Partners have deep experience across energy and growth sectors, and we believe R3 will benefit from their collective perspective on renewable energy solutions."
The 139-year-old Peabody, which was bankrupt and emerged from Chapter 11 reorganization nearly five years ago, is seeking to locate solar panels and battery storage at sites near or on former coal mining operations. The six prospective sites include former coal mines in Indiana and Illinois.
“As one of the world's largest private investment firms focused on energy, power, decarbonization and infrastructure, we believe we are well positioned to assist R3 Renewables to reclaim, reimagine and repower the region by pursuing these ambitious and transformative renewable energy projects,” Daniel Flannery, a Managing Director at Riverstone, said.
The R3 Renewables development goal is more than 3.3 GW of solar photovoltaic and 1.6 GW of battery storage over the next five years.
Peabody’s coal operations have emerged strong in recent periods despite the energy transition toward low carbon power. The St. Louis-based company reported more than $3.3 billion in revenue last year, more than 15 percent higher than the previous year’s earnings.
More than 4.5 million tons of coal were shipped in the seaborne thermal segment for the fourth quarter alone, Peabody reported. Most of those volumes were for the export market.
(Rod Walton, senior editor for EnergyTech, is a 14-year veteran of covering the energy industry both as a newspaper and trade journalist. He can reached at [email protected]).