Total has been hit hard by the fall in oil prices
The French oil giant Total has pledged to be among the top three companies in solar power, and to expand in electricity trading and energy storage.
On Tuesday Total announced a comprehensive new organization plan, including the creation of a fourth business segment to cover gas, renewable energy and power. This will include solar and energy storage as well as biofuels and potentially other renewable energies.
Total says that the move will “strengthen its position as a global energy leader”, but also alludes to the impact of the fall in oil prices, which began in the summer of 2014. Like other oil companies Total’s revenues have been hit hard, collapsing 32% to $143 billion in 2015.
Gas will be a main component of this plan, and the company states that it plans to expand in gas midstream and downstream, as well as in renewable energy and energy efficiency. Total plans to roll out the segment on January 1, 2016.
“Electricity will be the energy of the 21st century and the growth of gas and renewables is pushing us to take a value chain approach to electricity,” stated Total CEO Patrick Pouyanné in a press release.
“We have multiple ambitions in renewables in 20 years’ time: be in the top three in solar power, expand in electricity trading and energy storage, be a leader in biofuels, especially biojet fuel, and consider potential development opportunities in other renewable energies.”
Bloomberg New Energy Finance Head of Solar Analysis Jenny Chase says the move could indicate more support for SunPower, in which Total already holds a majority stake.
“Total’s announcement that it will carve out a business segment for gas, renewables and power indicates that it considers these businesses to be important and increasingly intertwined,” Chase told pv magazine.
“Its aim to be in the top three in solar power in 20 years’ time seems to indicate internal support for growth in solar manufacturer-developer division SunPower.”
“In the short term, seeking market share has proved a poor strategy for other solar developers and manufacturers, and who knows what will happen in the next 20 years? Maybe a company as large as Total is needed to bring the various pieces (energy storage, trading and renewables) together to revolutionize Europe’s power markets.”
Source: PV Magazine. Reproduced with permission.
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