Electricity will be the key energy for the 21st century. With demand for electricity growing faster than total energy demand, power should account for 30% of end consumption by 2040 if the International Energy Agency (IEA) is right. To meet the demand for power responsibly, our strategy depends on stepping up our electricity business. In keeping with our integrated business model, we now operate across the electricity value chain (excluding transportation), from gas-fired and renewable power generation to energy storage and marketing to the end customer.
The Rise of Renewable Energies
The IEA’s Sustainable Development Scenario has renewable energies accounting for close to 30% of the energy mix by 2040. We are ramping up our renewable power generation capacity — solar, wind, hydro — to satisfy the surge in electric power needs responsibly.
Our expertise qualifies us to operate across the photovoltaic solar value chain, from manufacturing photovoltaic cells to supplying electricity from renewable sources to our customers. Our activities also span developing and operating solar power plants, installing photovoltaic systems on residential, industrial and commercial rooftops and carports, and storage via our affiliate Saft.
Moreover, our affiliate Total Eren boasts a diversified collection of assets in wind, solar and hydro power that stretches across Asia, Africa and Latin America. As a result, it can develop projects in regions where renewable energy represents an especially appropriate and viable solution to growing energy demand.
Our objective: develop a portfolio of renewable power generation activities with a target of 15 to 20% of electricity sales by 2040.
Generating Power from Natural Gas
Natural gas is the lowest-carbon fossil fuel, emitting only half as much carbon in power generation as coal. Replacing coal with natural gas in power plants would cut global carbon emissions by 5 billion tons per year, or around 10%.
Another advantage of gas-fired power plants is greater operational flexibility. They can be restarted and ramped up twice as fast as coal-fired plants. Plus, the ability of natural gas to generate power flexibly also makes it a vital partner of renewables, which are intermittent by nature.
Gas is a cornerstone of our strategy, and we maintain an integrated position across the gas value chain. In 2018 and 2020, we acquired four combined cycle gas turbine (CCGT) power plants in France and Spain, respectively.