TOTAL S.A. (TOT - Free Report) announced that it is going to develop the Al Kharsaah Solar PV IPP Project in Qatar. This will be the company’s largest solar project to date, which requires investment of $500 million for completion. This 800-megawatt (MW) solar project was awarded to a consortium of TOTAL (49%) and Marubeni (51%).
The project is expected to begin initial operation with 350-MW capacity and support the Qatari grid from 2021. Its full capacity is expected to be attained by 2022. The solar plant will be built on more than 1000 hectares of land and equipped with 2 million bifacial solar modules with trackers.
Solar Project and World Cup
No doubt, the Al Kharsaah solar project will assist Qatar to meet the massive surge in demand for electricity during the FIFA World Cup that is scheduled to be held in 2022. Qatar is blessed with average daily sunshine of 9.5 hours, which will be used effectively by the solar project to generate huge volume of clean energy.
The Al Kharsaah solar project is expected to supply around 10% of electricity peak demand of the country and reduce carbon di-oxide emissions of Qatar by 26 million tons during the life of the project.
TOTAL’s Focus on Clean Energy
In addition to developing hydrocarbon projects across the globe, TOTAL is also working to develop clean energy development projects in different regions. The company is gradually building a portfolio of low-carbon businesses that could account for 15-20% of sales by 2040.
Total’s long-term plan is to develop clean renewable assets and take the current worldwide renewable energies capacity of 3 gigawatts (GW) to more than 25 GW of renewable energy by 2025. Acquisition of SunPower Corporation (SPWR - Free Report) have allowed TOTAL to expand its footprint in the renewable space.
Rising Global Use of Renewables
The U.S. Energy information Administration (“EIA”) release indicated that clean renewable energy will account for majority of global power generation by 2050. Per EIA, nearly 28% of the world’s power was attributed to renewables in 2018, courtesy of improved technology and increasing awareness about emission. Renewable sources are expected to account 49% of global power generation by 2050.
Since there is immense growth opportunity in the renewable energy space, we could notice that other oil and gas companies like Chevron Corporation (CVX - Free Report) and Royal Dutch Shell Plc (RDS.A - Free Report) are also investing heavily in the renewable energy space.
In the past three months, TOTAL’s shares have outperformed its industry.
TOTAL currently has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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