As one of the world's leading energy companies, Total (NYSE:TOT) has a lot at stake in the future of energy. Then again, as the fifth largest publicly traded integrated oil and gas company in the world, investors have a lot at stake in how Total approaches the changing energy landscape. While the future is impossible to predict accurately, the energy giant is betting that renewable energy will continue to represent one of the greatest growth opportunities. Let's follow the money and take a deeper look at the company's investments in the future of solar.
Photovoltaic solar cells and systems
Total owns a whopping 66% stake in solar leader SunPower (NASDAQ:SPWR), which is easily the oil and gas giant's most mature renewable energy investment. It may be the largest, too, with a market value of about $3.3 billion. The company wields photovoltaic panels with 21% efficiency -- tops in the industry -- and employs its systems in over 1,000 MW of solar power plants globally.
SunPower has numerous growth opportunities ahead of it for the next several years, but perhaps no project exemplifies the reach of its platform quite like the California Valley Solar Ranch. The facility, owned by NRG Energy (NYSE:NRG), will sport a capacity of 250 MW and power 100,000 homes while offsetting 333,000 metric tons of greenhouse gas emissions each year. Additionally, the 3,200 acres under the panels will remain virtually undisturbed thanks to the small footprint of its novel trackers, which follow the sun's position throughout the day to optimize energy capture.
I don't see anything impeding SunPower's growth for quite some time, although investors intrigued by the opportunity will want to follow my Foolish colleague and SunPower aficionado Travis Hoium.
Total doesn't want to get caught on the wrong side of history, which is exactly why it has also invested heavily in concentrated solar technology. The technology works by focusing sunlight on a pipe containing synthetic oil, which reaches a temperature of 390 degrees Celsius (734 Fahrenheit) and runs through a closed-loop system that passes through a steam generator. Superheated steam then drives a turbine to create electricity or desalinated seawater. It is an extremely efficient way to create power and can utilize the entire light spectrum.
Total is a 20% owner in Shams, one of the world's largest concentrated solar projects, which opened earlier this year in Abu Dhabi, United Arab Emirates. The facility spans 250 hectares, sports 258,048 parabolic collectors, and generates 100 MW of power. Additionally, Shams cost just $600 million -- representing an excellent return on investment -- and offsets 175,000 metric tons of greenhouse gas emissions per year. Total's involvement in the project cements its position as a leading concentrated solar provider, which will surely aid the company as more countries turn to the technology.
Foolish bottom line
Total may be known primarily as an oil and gas company today, but investors may come to know a very different company in the future. There's virtually no chance oil, fuels, and chemicals are displaced as the top products. However, strategic investments in renewable energy, especially solar energy, have the potential to not only drive growth but also change the face of the company. Long-term shareholders will reap significant benefits.
Fool contributor Maxx Chatsko has no position in any stocks mentioned. Check out his personal portfolio or his CAPS page, or follow him on Twitter, @BlacknGoldFool, to keep up with his writing on biopharmaceuticals, industrial biotech, and the bioeconomy.
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