The US renewables chief of global oil supermajor TotalEnergies said entering diverse green power segments will help it to hedge against regulatory drags on specific areas of the energy transition – and did not rule out adding onshore turbines to an American portfolio of interests that already spans offshore wind, solar and storage.
Speaking after TotalEnergies further strengthened in US PV with a deal to acquire the Commercial & Industrial (C&I) business of solar player SunPower, Marc-Antoine Pignon, the French group’s managing director for US renewables, said the country would play a key role in its overall plans to hit 100GW of gross green power capacity by 2030, among the most ambitious targets globally.
“You can’t really skip the US as a market. That’s why we started entering at large scale.”
The SunPower C&I deal follows a flurry of acquisitions in US large-scale PV and storage, and partnerships last year to enter both fixed-foundation and floating wind there. TotalEnergies also expects to retain a majority stake in SunPower’s remaining residential-focused solar operation.
Asked by Recharge if onshore wind is the next logical step in the US market, Pignon said: “The question is, can I skip not a market, but one technology, one segment, considering the ambition we have?
“At this stage I don’t have myself anything cooking, but I’m just one small part of the whole company.
“But if I go back to the rationale of why we’re in the US, because it’s a derivative of our ambition, at some point in time it makes sense to be in the largest markets and in all the technologies as well.”
The focus of TotalEnergies’ current global onshore wind interests are via its minority stake in Total Eren, the developer that is planning huge projects in parts of Latin America, Europe and Asia, but so far has no North American assets listed on its website.
Pignon said a broad sweep of renewables interests could help cushion the negative regulatory impacts on a single sector at any particular time, meaning “you hedge a little bit against regulations that can slow down at one end and accelerate at the other”.
'Bubbling and evolving'
Pignon described the US regulatory scene as “a very bubbling and evolving environment”, but said measures such as those in the Build Back Better package, currently stalled in the legislative process, had the potential to “give visibility” over a longer span of time.
“What people don’t like, and it goes for us as well as customers, is to have an erratic pattern, or not knowing how things will shake out. Long term visibility would be really great with that type of act passing,” he said.
According to Pignon, the sheer complexity of the US renewables market environment is one of the drivers behind the SunPower buy-up. The deal will see TotalEnergies spend up to $250m to acquire full control of the California-based PV group’s C&I business, which works with companies such as Johnson & Johnson and Toyota, as well as government and public agencies, to provide solar systems or services.
Pignon said as a large energy group already active in multiple sectors, TotalEnergies can help C&I customers navigate the regulatory maze, as well as reap benefits from economies of scale. “When you buy big for large projects you can find benefits for smaller individual projects as well,” he said.
“[And] because of different markets, different states, different regulations, different utilities, the best solution is not always the same one for each customer.”
The beauty of distributed is you’ve got generation right next to consumers.
According to Pignon, TotalEnergies’ business-to-business (B2B) customer base is increasingly looking for a mix of “corporate PPAs, community solar, industrial PPAs [and] behind the meter” solutions to their energy transition dilemmas, spurring the group’s desire to be a “one-stop shop for large corporations”.
The TotalEnergies executive predicted a bright future for community solar schemes in the US, with deployment of PV arrays in the 5MW or so range near local centres of demand.
“One of the fundamental reasons distributed generation makes sense in the US is that if you just rely on large-scale, you have to rely on the grid… where the network is more complex, from an ownership and regulatory perspective,” Pignon said.
'Important move in C&I'
“The beauty of distributed generation is you’ve got generation right next to consumers… which is a good asset to have.
“Community solar [is set to] keep growing. We can’t just rely on the grid to get bigger for [growth of large scale renewables to inject green electrons.”
Matthieu Langeron, vice president distributed generation, renewables at TotalEnergies, said of the SunPower deal: “From a pure C&I point of view, the US market is probably the third or fourth market in the world, so it was very important for us to have this position.
“It’s true that the C&I market could be conceived as a bit complex. Part of our know-how here [is] we do have this knowledge and skills of managing small projects,” such as the group’s massive network of gas stations.
“[In distributed generation] we have this capacity to duplicate from China, from Singapore, from Dubai to the US.”
Langeron added of SunPower: “We are not buying a pure development platform – we are buying a team of people doing this job for many years.”
However, Langeron warned that the US business would be subject to the same pressures as the rest of the global solar industry, for example around module pricing.
“For solar panels we are not seeing for the year ‘22 positive changes, and also for the early part of ‘23 it is very uncertain. We will have to deal with that. We will have an increase of our Capex, [but] on the other hand prices for electricity are not slowing down.
“Our B2B customer are [therefore] attracted to even switch part of their consumption into on-site solarisation.”