TotalEnergies bullish on China and further investment in green power

TotalEnergies China, the local unit of French energy company TotalEnergies, will continue to invest in China's renewable energy sector, especially in its offshore wind and solar projects, to support Beijing's carbon neutrality ambitions, a top company official said.

While the government recently announced it is scrapping subsidies for new centralized photovoltaic stations, distributed photovoltaic projects and onshore wind power projects, TotalEnergies will continue expanding in the country's wind and solar sectors, as well as other clean energy industries, which is in line with its goal and the China's carbon neutrality ambitions, said William Zhao, country chair of TotalEnergies China.

"TotalEnergies will invest in the renewable energy sector in China regardless of subsidy, as we believe in the long-term performance and financial return of renewable energy in the country," Zhao said in Beijing on Monday.

He said the withdrawal of subsidies encourages fair competition in the renewable energy sector, and those who focus on subsidies alone will get phased out.

The subsidies have made it easier for enterprises to enter the country's renewable sector but are not sustainable in the long run, he said.

Zhao said TotalEnergies has been focusing on China's offshore wind and solar energy projects, looking for opportunities in the renewable energy sector, and will continue doing so, working together with local partners to provide efficient solutions for energy transformation.

Analysts say that with China's renewable energy market developing rapidly in recent years, multinational corporations want to benefit from the market's future expansion, which will in turn lead to fast-tracking of development.

Tang Sisi, an analyst at research firm BloombergNEF, said China's carbon neutrality pledge highlights the importance of decarbonization in its energy sector, and many international corporations have been stepping up efforts to align their core businesses with Chinese market demand.

The impact of the novel coronavirus outbreak on China's solar industry has been lower than expected, while China's solar exports to many overseas markets are recovering, Jiang Yali, a solar analyst at BloombergNEF, said earlier.

Zhao said TotalEnergies is paying close attention to China's offshore wind projects, including those in Fujian, Jiangsu and Guangdong provinces, as the company is very confident about its offshore wind technologies.

"China is likely to be the biggest player in the world's offshore wind market very soon, which provides plenty of development opportunities," he said.

The company is also laying out plans for China's solar industry sector. In less than 18 months, TEESS, a 50/50 joint venture company established by Total Energies and Envision Group, sees its solar projects for commercial and industrial customers in China generating 100 megawatts of energy, while another 50 MW is under construction.

TEESS' fast-tracked progress has enabled it to rank among the country's tier-one companies, generating solar power for distribution despite the impact of COVID-19 last year. The company is currently building up a team in China's renewable energy market.

"We have recruited a large number of talents in the renewable sector in China to expand our presence in the country," Zhao said.

TotalEnergies changed its name from Total last month, indicating its strategic transformation into a broad energy company, which Zhao said is recognition of what TotalEnergies has been doing in the past decade, a transition from oil and gas to a more diversified energy mix.

Ian Lepetit, president of Total (China) Investment, said the company will undergo a major energy transition in the next 10 years, with oil to account for 35 percent of its energy involvement from the current 55 percent and the share of electricity and renewable gas and fuels set to rise from 5 percent to 15 percent.

"The company also plans to invest $60 billion in renewable energies and energy transition over the next 10 years to become a world-class player in the energy transition market, of which China is expected to account for a significant share," Lepetit said.