The transition to zero-emission energy production will lead to higher electricity prices. This was stated by the head of the French energy giant TotalEnergies Patrick Pouyanne.
“We believe that fundamentally this energy transition will mean a higher price for electricity,” Patrick Pouyanné told The Financial Times.
There is a theory that says that renewables are cheaper, so the price will be lower, Patrick Pouyanné continued: “We don’t think so, because the system in which you have more renewables is less efficient…”
Previously, the head of TotalEnergies expressed doubts about the projected pace of transition to emission-free cars.
“You're asking people to spend more money on cars that have the same features as a combustion engine. Why should they spend more money? Tell me,” says Pouyanne.
The head of the French energy giant says politicians and activists are naive to think oil and gas production can be cut before enough renewables take their place.
“The pace of transition will not be the same everywhere,” he said. “We cannot ask African countries not to develop resources because we have been developing their resources for our own comfort for 20 years.”
Patrick Pouyanné believes that working with the Global South is necessary, because without it there is no solution to the climate problem.
TotalEnergies continues to maintain a strategy that puts oil and gas production first, and renewable energy projects second. Of its $16.8 billion in capital expenditures in 2023, the company spent roughly two-thirds on fossil fuels and one-third on its “low-carbon” integrated energy business.
“I need to be strong in the oil and gas industry… Because of this, people buy our shares in the first place,” noted the head of TotalEnergies.
TotalEnergies believes that the company will begin to receive profits from green energy no earlier than 2028, when it will generate cash flow of about $4 billion.
Pylyp is an experienced private banker and asset manager.