Total Eren on acquisition trail for Brazil renewables growth

Total Eren – the renewable development arm of French oil giant Total – plans steady growth in Brazil mainly through the acquisition of operating and ready-to-build projects, its country head told Recharge.

As it prepares a multi-pronged strategy spanning the regulated and unregulated sectors, Pierre-Emmanuel Moussafir, Brazil manager for Total Eren distanced himself from reports in the media there of a 1GW, 10-year target.

“We don’t have regional targets, Total only has global targets, so we grow as projects are presented and approved,” Moussafir told Recharge.

Total globally has a goal to reach 25GW of renewable capacity by 2025 up from under 5GW now, so Brazil’s huge solar and wind potential, and dynamic market – with lots of M&A opportunities – could make it an important part of the equation.

While Brazil’s wind capacity is set to double in 10 years from 15GW today, solar will reach over 9GW from 2GW in the same period.

Although Moussafir declined to talk about the company’s previously-announced renewable energy pact with Brazil’s federal oil company Petrobras, he said talks are still on-going despite Petrobras’s decision to step away from renewables.

Total Eren itself has entered the wind sector in Brazil as part of a growth strategy to offer a diversity of products in the non-regulated market, which is dependent mostly on large corporations and power trading companies controlled by large utilities.

Although it hasn’t abandoned government tenders – it has lined up solar projects for October’s A-6 tender – Total Eren is preparing itself to take on the more complex PPAs available in the non-regulated sector, which accounts for over 50% of the growth of Brazil’s wind power industry since 2018.

“We have to understand what the consumer in the non-regulated market wants,” Moussafir said.

Offering power in the non-regulated market is part of the profound shift that Moussafir has seen in Brazil since Total Eren opened an office in the country almost two years ago. “A lot has changed since then,” he said.

Total Eren has grown through the acquisition of almost commission-ready projects, which was the case with its first asset, the 50MW BJL solar PV plant.

The company now has 140MW of PV operational after the commissioning of the 90MW Dracena project, and in November it should conclude the acquisition of the 79MW Filgueira wind complex it acquired from French renewable energy developer Voltalia earlier in September, following the acquisition of 92MW Terra Santa wind power project in April.

BJL was a completed plant when Total bought it and Dracena, although not built, had a PPA in place. On the other hand, Filgueira and Terra Santa, although also in late-stage development, are not fully backed by PPAs yet and will likely sell most of their power in the non-regulated segment.

“Our policy is to carry [out] a detailed appraisal and reduce risk. Our focus is on increasing value to the shareholder,” said Moussafir.

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