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Total confirms net zero ambition by 2050 and announces intermediate scope 3 absolute emissions targets

Held last 30 September, Total’s Investor Day was an opportunity for France’s integrated oil group to reaffirm its commitment to fighting climate change. The event was eagerly awaited after rival BP unveiled mid-August a newroad map for achieving carbon neutrality by 2050 (see below on the differences between the two companies in terms of total energy supplied especially from natural gas). To begin with, bear in mind that the objective of achieving carbon neutrality over this horizon is a prerequisite for the fulfilment of the Paris Agreement signed in December 2015, which aims to keep global temperature rise this century well below 2 degrees Celsius compared with their pre-industrial level. Meanwhile, the trajectory and steepness of the decarbonization curve to get to net zero by 2050 are of the utmost importance because cumulative emissions from 2015 until 2050 will be decisive. If absolute emissions were to continue increasing until around 2035-2040 before a sharp decrease to become net neutral from 2050 onwards, the below 2 degrees target would be missed. Furthermore, the notion of carbon net neutrality at company has been legitimately questioned (for a general critique of the business’ concept of being “carbon neutral” at company level, see for instance the publication “Net zero initiative” from Carbone 4).

For the energy majors, the stakes are considerable. Oil and natural gas are used as primary energy sources and, despite the substantial difference between the two fuels in terms of carbon intensity[1], were together responsible for 56% of global carbon emissions in 2019[2] (compared with 44% for coal alone). The question is therefore over the good fit of Oil & Gas groups’ business portfolio with the energy transition initiatives/policies that are being implemented, mainly in OECD countries. For the majors, the risk attendant to these initiatives/policies ‑ were they to upset a global primary energy mix still largely dominated (by more than 80%) by hydrocarbons ‑ would be a definitive loss in the value of a large part of their assets. Majors would be burdened with stranded assets if the scenario of a successful transition towards a low carbon economy were to come about (unless there is massive rollout of carbon capture and storage (CCS) technologies, which looks unlikely at this juncture, on this topic, see the interview from Andrew Grant, Senior Analyst at Carbon Tracker).

In this context, European majors have signalled in recent months their determination to change business models, with various announcements emphasizing their resolve to achieve carbon neutrality: besides Total and BP at the start of the year, other European players such as Repsol and Shell also entertain largely similar ambitions (see “European oil & gas groups: actively trending towards utilities’ business models?”).

During its investor day, Total reiterated its ambition to achieving carbon neutrality, i.e. Net Zero, by 2050 (Scope 1+2+3), as well as the steps to achieve this ambition unveiled last 5 May, namely  

  1. Net Zero on Operations by 2050 or sooner (Scope 1+2);
  2. Net Zero in Europe by 2050 or sooner (Scope 1+2+3);
  3. Net Zero by 2050 “together with society for its global business” (Scope 1+2+3)”), which can be qualified as an under regulatory conditions target or an aspirational statement. According to Total CEO P. Pouyanné, it means that ”at the global level, we [Total] will expand this carbon neutrality pledge to other regions when they adopt the same path as Europe, to ensure we become carbon-neutral together with society”.
  4. 60% or more Net Carbon Intensity reduction by 2050 (Scope 1+2+3).

From this point of view, the new element announced by Total last month was a set of intermediate targets on scope 3 emissions, namely:

  1. A reduction in absolute value by 2030 from 2015 level (below 410MtCO2eq) and
  2. Specifically, for European operations, a 30% reduction in absolute value by 2030 also from 2015 level

The introduction of these intermediate targets led Total to specify the planned evolution of its operational scope over the next 10 years:

  1. Total now intends to scale back oil production all the while scaling up gas and low-carbon electricity in its product mix. In this context, the respective shares of oil and gas would go from 55% and 40%, respectively to 35% and 50%, respectively. In parallel, the share of power, biogas (biomethane) and hydrogen would rise from 5% today to 15% by 2030 (see graph below);
  2. Total is to accelerate the development of low-carbon energies (renewable energies and low-carbon gas, i.e. biomethane and green hydrogen), and has raised its objective for gross renewables capacity to 35GW in 2025 from 25GW previously (when it had 3GW at end-2019); and has the ambition to add around 10 GW per year beyond,  leading theoretically its installed capacities to 85 GW in 2030.
  3. Total, ambitions to transform its business model and become a “broad energy company”


Figure 1 : Total’s targeted product mix by 2030

Source: Total (2020)


Interestingly, as mentioned above, Total’s investor day follows BP’s strategy and climate announcements made the month before (see our dedicated article). In broad terms, Total’s announcements are very similar to its British peer’s. It should be remembered that as part of its climate neutrality objective by 2050, BP has set itself the objectives by 2030 of reducing its production of oil and gas by 40% from 2019 levels, of increasing its renewable capacity (by 2.5 GW at the end of 2019 at 50 GW by 2030), to develop bioenergy and hydrogens and electric mobility through investments in charging infrastructure. In the background, BP ambitions to become a “integrated energy company”. The pillars of the two groups’ climate strategies are therefore very similar. However, we can consider that from the perspective of the potential contribution of natural gas, BP's intention is “disruptive” since it targets an absolute decrease in oil and gas production by 2030, while Total pursues an “aggressive” diversification strategy as it  intends to increasingly rely on natural gas, alongside increasing involvement in the various abovementioned low carbon technologies, to make up for the decrease in oil production and decarbonize its production mix.

In the context of persistent uncertainties over a recovery in demand for oil in the wake of the ongoing health crisis, it is very likely that Total’s improved climate roadmap and targeted asset base reshuffling will continue to inspire some other large oil and gas groups. However, for the time being, as indicated in the abovementioned study on European oil & gas groups, it is a safe bet that Total's new strategic and climate objectives should primarily inspire other industry leaders in Europe[3], in particular when it comes to accelerating the deployment of low-carbon assets/technologies (renewable capacity, EV battery and charging infrastructure, low-carbon hydrogen, etc.). The reconfiguration of these actors’ asset base fits into a dual perspective: first, mitigate the abovementioned rising stranding risk amid uncertain oil economics and intensifying energy transition initiatives across OECD countries, second, tackle mounting political and social pressure in the field of climate (in) action.

Indeed, observation of the recent strategic and climate announcements on both sides of the Atlantic highlights a growing gap between European Oil & Gas majors and their US peers (ExxonMobil and Chevron), the latter showing an almost complete absence of climate commitments. We mainly see three reasons for such climate inaction on the side of US groups:

  1. The first explanation lies in the domestic political and socio-economic landscape these players face. For any US hydrocarbons producer, Trump administration’s apparent climate-scepticism and the entire country’s reliance on cheap oil and gas provide no incentive to engage in climate change mitigation strategies (see our recent report on the U.S. President election);
  2. The second explanation lies in the level of shareholders' expectations in the field of climate action, which clearly seems weaker in the United States than in Europe. This pressure can take the form of a collective action from individual shareholders to guide the AGM resolutions or of the implementation of investment policies articulated around the gradual phase-out of fossil fuels on the part of "mainstream" asset managers. While they are multiplying in Europe, such initiatives still seem isolated across the Atlantic or have thus far had no material impact on the communication and / or the strategy of the major energy groups concerned;
  3. The last possible explanation for this inaction is a desire to maximize the rent linked to hydrocarbons extraction pending possible technological, economic or regulatory disruptions in the sector. From this angle, one could argue that American majors are simply sticking to a cash flow maximization strategy, while awaiting the early signs of systemic changes in the energy sector (which could take the form of “peak oil through demand”). Still from this angle, the US majors would let their European peers bear the negative cash flow and financial risks associated with the development of low-carbon technologies, some of which (production of biofuels and green hydrogen) have not yet reached commercial viability.

In the light of the recent political announcements at EU[4] as well as Member States levels[5]  but also of the technological revolutions underway in the energy sector (continued fall in solar PV costs[6], diffusion of electric mobility, growing interest in low-carbon gases, etc.), it is nevertheless questionable whether this strategy of inaction will not ultimately prove to be more risky than that of action. From this point of view, it is certain that the advantage that Total seeks to derive from the acceleration of its operational transformation is the position of prime mover across a range of low carbon assets/technologies. The latter could indeed prove to be decisive at a later stage of the deployment of a range of energy products and services compatible with the economy's progress towards carbon neutrality.


[1] Natural gas is around 30% less CO2 intensive than oil upon combustion. It also emits 45% less CO2 than coal.

[2] Source: International Energy Agency, World Energy Outlook 2020.

[3] In particular Eni, Shell, which is due to release its new strategy next February, and Repsol, which is due to communicate its new strategic Plan on 26 November.

[4] The €750bn recovery plan announced last May by the European Commission features a €74bn InvestEU facility offering direct grants to strategic sectors, including renewable energies and low-carbon hydrogen production (green energy-powered electrolysis).

[5] France and Germany recently unveiled major recovery plans (€100bn and €130bn, respectively) both featuring massive public support for the production and uses of low-carbon hydrogen with €7bn and €8bn, respectively earmarked for the sector upscaling by 2030.

[6] Striking case of recent solar power tender in Abu Dhabi, with a record-low solar price of 12.1 €/MWh