In this exclusive interview, Namita Shah, President, People & Social Responsibility, Total discusses India’s renewable energy market and the company’s latest partnership with Adani group.
Total has been very vocal about its objective of reaching 35 GW of production capacity from renewable sources by 2025 and expanding its business to become one of the world leaders in renewable energies. How has that journey been so far?
As an energy company, we are faced with the dual challenge of meeting growing energy needs while reducing our emissions. We want to be carbon neutral in 2050 in line with society. To achieve our objectives, we have implemented a strategy of transformation to become a broad energy company. This strategy involves adjusting growth in oil, growing in natural gas, accelerating our presence in renewables and electricity and investing in carbon sinks. We have to develop our capacity to generate electricity from low carbon sources, including renewable sources. We started this journey in 2016, with the creation of a gas, power and renewables branch.
In 4 years, the Group has managed to learn, understand, test and scale up our ability to grow in this sector with a viable business model. What began as a test and learn process has now been consolidated as a key part of our transformation.
In 2020 the Group's gross power generation capacity more than doubled to reach 7GW with more than 3 GW of wind projects in France, the UK and Korea, more than 5 GW of solar assets in operation or under development in India, more than 5 GW of solar projects in Spain, a giant 800 MW solar farm in Qatar and 4 GW of solar projects in the US. So the journey has been exhilarating and gratifying. We know we can deliver for society, for our employees and for our share holders.
What makes India's renewable energy sector a good investment choice for international investors such as Total?
India is becoming a key market for Total, not only because of its size, but also because of its government’s stated intention to comply with the Paris Agreement. We want to work in line with society to develop the energy mix and fulfil energy needs. India is and will continue to be one of the world's biggest energy consumers and, until recently, relied primarily on oil and coal to meet its needs. India has asserted its commitment to the Paris Agreement. To deliver, the country has decided to adapt its energy mix by increasing the share of natural gas from 6% today to 15% by 2030 and 40% of electricity will be generated from renewable sources over the same period. India is clearly the right place to deploy our growth strategy based on natural gas and renewables.
Can you tell us a little more about the energy partnership between Total and Adani?
We believe that it is not possible to develop in India without a strong local partner. India is a large country, with a patchwork of federal and state rules and regulations and a bureaucracy that can be difficult to navigate as an outsider. The gas and renewable businesses are very local. We decided early on that we would not go into India without a partner on the ground. There aren’t many private entities that work in the energy sector in India which have the ambition and ability for large-scale operations.
The Adani Group has both in the two business that are of interest to us: gas and renewables. Since 2018, we have been building our relationship with the Adani Group to develop it into a strategic partnership. At Total, we believe in long-term relationships, and to make a long-term commitment we need a strong foundation of trust and mutual respect. We started our partnership with investments in liquefied natural gas terminals in India and in gas marketing and distribution and then continued with renewables with our most recent entry into the capital of Adani Green.
What are some of emerging renewable energy sectors in India that excite you? And why?
The government is clearly pushing solar energy as a priority, and it is that space that has and will see the greatest growth in India over the next few years. The acquisition of a 20 per cent minority interest in Adani Green Energy Limited (AGEL), strengthens Total’s growth objectives in renewable energies and our ambition to rank among the top five worldwide. AGEL currently has a renewable project portfolio of over 14.6 GW and is aiming to expand it to 25 GW by 2025. There are other sectors that we will keep an eye on in India – hydrogen, for example, and the evolution of the use of fuels in mobility.
How can large corporations work towards more sustainable operations and help build back better? Is this realistically possible in your opinion?
Total wants to get to net zero by 2050 and will put sustainability at the heart of its transformation. We have a reputation of delivering on what we say, and our transformation strategy is based on a firm belief that this is possible. On climate issues, the key is how we set the pace. Moving in sync with society means adapting to the different geographic areas in which we operate. Energy transition can’t happen overnight.
Oil is not going to completely disappear and the pace of change from oil-based to low-carbon energies will depend on the economic realities on the ground. India knows this – it has to balance the need for economic prosperity for all with the Paris Agreement. All actors will need to mobilise in the same direction – private entities, governments and society. And all actors – including individual citizens – will have to adapt. Our role is to help drive this change – that is a commitment we are making. Our climate objectives in Europe go further, as they are aligned with European objectives. Our investments in India in gas and renewables are aligned with the direction in which India wants to go.
Let’s not underestimate the amount of money and technical expertise that will be required to deliver this new normal. Total has both: we are home to some of the best engineers in the world, who are eager and able to deliver. We also benefit from our upstream business, which is profitable and enables us to finance the investment needed to accelerate the pace of change. We have expertise in sustainability. We understand our role in preserving biodiversity, raising standards and ensuring that we benefit people in the places we operate. And let’s be clear: environmental and social issues will need to be addressed by all companies, no matter what they produce.
Our children expect better from us, and the senior management of this company is of a generation that understands the importance of building back better. Not only is it the right thing to do, it makes plain, old-fashioned economic sense. If we don’t fulfill stakeholder expectations, we will go the way of the dinosaurs. And we intend to be here as a broad energy company, providing clean, affordable and reliable energy across the globe, for decades to come.