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TOTAL Commences First Japanese Solar Project with ISE Group

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Integrated Oil & Gas company TOTAL S.A. (TOT - Free Report) began operating its first photovoltaic power plant in Japan along with Japanese partner, ISE Group. The 27 megawatt (MW) solar plant is located in Nanao on Japan’s Honshu Island. 50% of this project is owned by ISE Group while both TOTAL and its subsidiary, SunPower Corporation (SPWR - Free Report) own 25% each.

The solar project is spread over 25 hectares of land owned by ISE Group.  An excess of 80,000 SunPower’s high efficiency solar panels were utilized to develop the solar project. These particular solar panels will be able to produce 45% more energy in the same amount of space compared to other conventional solar panels.

TOTAL’s investment in Solar Power

TOTAL has realized the importance of green energy and has started to invest in renewable energy space through its unit, SunPower Corporation. The company joined the renewable energy bandwagon as it expects renewables and hydropower to represent 20% of the global energy mix by 2035, compared with 13% in 2010.

To expand its renewable energy generation assets, TOTAL is focused on developing new projects in the fast growing solar market. Developing the solar project in Japan is a part of the company’s strategy.

More Opportunities on Offer
India can be a land of opportunity for renewable energy operators, as it plans to generate 100 gigawatts (GW) of power from solar project by 2022. China aims to produce 105 GW of solar energy by 2020. Hence, these countries will offer ample opportunity for TOTAL to expand its solar ambitions.

Japan, after its Fukushima nuclear accident, has shifted its focus toward alternate sources of energy. The change in energy policies will help to develop more solar projects in Japan like the Nanao solar project.

Global Solar Outlook

Per a recent research report from GTM Research, the global solar market will touch 85 GW in 2017 and will continue to rise gradually to approximately 110.1 GW in 2022.

It is evident that the demand for renewable energy is strengthening at a rapid pace. Moreover, the gradual growth of the solar markets will bode well for all global players and instill investors’ confidence in the industry in the long term.

Price Movement

In the last six months, TOTAL’s shares returned 3.1%, outperforming the Zacks categorized Oil & Gas Integrated International industry’s increase of 0.2%.

TOTAL’s strong production portfolio, initiative to lower operating costs, reduce debts and start new projects will further boost its performance.

Zacks Rank

TOTAL currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the same space are ENI S.p.A. (E - Free Report) and Repsol SA (REPYY - Free Report) .

ENI S.p.A. has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The company reported a positive earnings surprise of 85.7% in the previous quarter. The 2017 Zacks Consensus Estimate for the company moved up by 40.0% to 14 cents per share in the last 60 days.

Repsol SA, another Zacks #2 stock, reported a positive earnings surprise of 104.0% in the previous quarter. The 2017 Zacks Consensus Estimate for the company moved up by nearly 38.0% to $1.49 per share in the last 60 days.

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