Total shareholders have voted in favor of rebranding the group as TotalEnergies, highlighting the pressure to shift away from fossil fuels and toward renewable.
Total has increased investment in renewables
Total’s decision to rebrand as TotalEnergies follows years of growing investment in renewables. Shareholders in the oil and gas group Total voted overwhelmingly in favour of rebranding the group at the company’s annual shareholder meeting. The company also won backing for reaching carbon neutrality by 2050.
The decision reflects the shift toward renewables, which has become increasingly prominent in the oil and gas industry in recent years. Acquisitions have become an effective way for companies to diversify and Total has utilized this strategy.
In January 2021, the company announced the acquisition of 20% stake in Adani Green Energy Ltd, which will help in achieving gross production capacity by 35 GWp from renewable sources by 2025. In March 2020, the company acquired 100% of Global Wind Power (GWP) in France through Total Quadran. GWP has a 1000-megawatt (MW) portfolio of onshore wind projects, including 250 MW scheduled to come on stream by 2025.
Some believe Total still isn’t doing enough
Despite its latest commitment to renewables, several Total shareholders and analysts have expressed concern that the French oil and gas major is not doing enough to curb carbon emissions.
According to the International Energy Agency, new fossil fuel projects must stop in 2021 if the world wants to reach the goal of achieving net zero carbon emissions by the middle of the century.
While Total has increased investments in renewable projects in recent years, it is still moving forward with non-renewable projects. The company plans to increase gas production in the coming years and is also involved in building new projects in the Arctic and East Africa.
It has been an eventful week for energy firms
Just one day ago, a civil court in the Netherlands ruled in a landmark case that by 2030 Shell must reduce its CO2 emissions by 45%, compared to 2019 levels. According to Friends of the Earth (FoE), it is the first time a company has been legally obliged to align its policies with the Paris climate accords, making its decision a significant one.
On May 26, Exxon also came under pressure. Exxon failed to shield its board against a rebellion which was launched by hedge fund activists at Engine No. 1. The move meant that the hedge fund was able to successfully replace two Exxon board members with its own candidates, to help drive the oil company towards a more eco-friendly strategy moving forward.
Recent events continue to highlight the growing pressure on energy firms to switch to renewable and Total’s decision is only the latest in this ongoing saga.