Back to top

Image: Bigstock

TotalEnergies to Acquire 50% Stake in Germany Offshore Wind Projects

Read MoreHide Full Article

TotalEnergies SE (TTE - Free Report) announced that it has signed an agreement with RWE to acquire a 50% stake in two offshore wind projects in the North Sea.

With this new alliance, TotalEnergies will be able to supply green electrons to help decarbonize the nation's electricity and industry, furthering RWE’s integrated growth in the largest electricity market in Europe and Germany.

Key Highlights of TTE’s New Deal

The two projects, N-9.1 of nearly 2 gigawatt (GW) and N-9.2 of 2 GW, located 68 miles (110 km) off the German coast, were awarded to RWE in August 2024 and have 25-year licenses extendable to 35 years.

This acquisition, along with the previously granted N-12.1, N-11.2 and O-2.2 concessions, should allow TotalEnergies to maximize the cost savings associated with its 6.5 GW German offshore wind hub.

Preliminary studies into the marine environment, geological formations, wind and ocean conditions have already been carried out by the German Federal Maritime and Hydrographic Office. This data should help RWE and TotalEnergies plan the construction of the parks, which are expected to become operational in 2031 and 2032, respectively.

TotalEnergies Prioritizes Clean Energy

In an effort to reach net zero emissions by 2050, TotalEnergies is developing a world-class, cost-competitive portfolio that combines flexible assets like combined-cycle gas turbines and storage with renewable energy sources like solar, onshore and offshore wind. The idea is to provide clean, reliable electricity to its customers.

By mid-2024, TotalEnergies’ gross installed renewable electricity capacity had reached 24 GW. TotalEnergies continues to develop this activity and plans to reach 35 GW of clean electricity production by 2025 and more than 100 TWh by 2030.

TotalEnergies’s portfolio of offshore wind projects has a total capacity of more than 17 GW, with most farms bottom-fixed. These projects are located in the United Kingdom, South Korea, Taiwan, France, the United States, the Netherlands and Germany.

Other Companies’ Focus on Renewable Energy

Along with TTE, other companies like BP plc (BP - Free Report) , Shell (SHEL - Free Report) and Equinor ASA (EQNR - Free Report) are also expanding their renewable energy operations with a focus on wind energy.

BP aims to become a world leader in offshore wind, safely developing and operating a multi-gigawatt global pipeline over the next decade. BP has an offshore wind pipeline of 9.6 GW net with planned projects and partnerships across the United States, Europe and Asia.

BP’s long-term (three to five years) earnings growth rate is 2%. The Zacks Consensus Estimate for 2024 sales indicates a year-over-year increase of 7.9%.

Shell has more than 2 GW of offshore wind capacity in operation and under construction, and more than 7.9 GW in the funnel of potential projects across North America, Europe, the UK and Asia. It is also investing in the next generation of wind technologies, including floating wind.

SHEL’s long-term earnings growth rate is 5.1%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year increase of 0.5%.

EQNR plans to reach an installed net capacity of 12-16 GW by 2030. Its total renewables portfolio has the potential to produce 35-60 TWh in 2030 and two-thirds of this is expected to come from offshore wind. The next stage of the global transition to low-carbon, renewable energy is now underway, and offshore wind is at the heart of this revolution.

EQNR’s long-term earnings growth rate is 2.2%. The Zacks Consensus Estimate for 2024 EPS indicates a year-over-year decrease of 3.8%.

Find the latest EPS surprise estimates and surprises on Zacks Earnings Calendar.

TTE’s Stock Price Performance

In the past three months, shares of TotalEnergies have risen 2% compared with the industry’s 0.5% growth.   

 

Zacks Investment Research
Image Source: Zacks Investment Research

TTE’s Zacks Rank

The company currently has a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Published in