On September 19, French oil firm Total announced the purchase of a 23 percent stake in renewable energy company Eren, enhancing its position in the green energy sector. The deal is valued at €237.5m ($284.7m) and gives Total the opportunity to takeover Eren after a period of five years.
The purchase highlights Total’s acceptance of emerging environmentally friendly sources of energy. Although fossil fuels have dominated power generation for decades, the falling costs of solar, wind and hydroelectric energy have granted the green energy market a chance to compete with fossil fuels.
Eren, which will be renamed Total Eren after the transaction is complete, aims to possess a global installed energy capacity of more than 3GW by 2022. Speaking about the purchase, Total CEO Patrick Pouyanné said the partnership would have strategic rewards for both companies.
Eren, which will be renamed Total Eren after the transaction is complete, aims to possess a global installed energy capacity of more than 3GW by 2022
“Total integrates climate challenge into its strategy and is pursuing steady growth in low-carbon businesses, in particular in renewable energy,” Pouyanné explained. “By partnering with Eren, we are leveraging a team that has a proven track record in renewable power production, and we are investing in an additional asset to accelerate our profitable growth in this segment, in line with our ambition to become the responsible energy major.”
In further efforts to project a more conscientious image, Total has also committed to taking over energy efficiency firm GreenFlex, a global leader in the use of data science to manage energy consumption. Although the value of the deal remains unknown, GreenFlex currently boasts annual revenues in excess of €350m ($419.6m).
Evidently, Total is keeping up efforts to diversify its energy portfolio at a time when oil prices are depressed and environmental concerns are gathering pace. However, the company has not given up on its core offering and announced the $7.55bn purchase of oil production assets from Danish firm AP Moller-Maersk back in August.