TotalEnergies completes AES Caribbean renewables acquisition and Portugal asset sale

Why is TotalEnergies buying into Caribbean renewables while selling half its Portuguese assets?

TotalEnergies SE (EPA: TTE), the global integrated energy producer, has moved decisively on two strategic transactions aimed at accelerating its capital-light expansion in renewable energy. On July 2, 2025, the French energy major announced it had acquired a 50% stake in AES Corporation’s renewable energy portfolio in the Dominican Republic. This adds to a prior 30% stake it holds in AES’ Puerto Rico solar and battery storage projects, giving it access to a total of 1.5 GW of combined capacity across the Caribbean.

On the same day, TotalEnergies also completed the sale of a 50% interest in its 604 MW portfolio of operational solar, wind, and hydro assets in Portugal to a Japanese consortium comprising MM Capital Partners 2 Co., Daiwa Energy & Infrastructure Co., and Mizuho Leasing. The deal, valued at an enterprise worth of €550 million, generated €178.5 million in equity proceeds.

Together, these transactions underscore a business model that blends asset-light capital recycling with targeted expansions in strategic geographies. Analysts interpret these twin moves as emblematic of TotalEnergies’ long-term pivot toward integrated electricity—delivering flexible, clean, and contracted power assets in both mature and fast-growing markets.

How is the AES partnership reshaping TotalEnergies’ Caribbean clean power ambitions?

The partnership with AES Corporation marks a milestone in TotalEnergies’ multi-energy strategy in the Caribbean. The newly acquired 50% stake in AES Dominicana Renewables gives TotalEnergies access to over 1 GW of clean energy projects in the Dominican Republic alone. Of this, approximately 410 MW is already operational or under construction under long-term power purchase agreements, while another 500 MW remains in the development pipeline.

TotalEnergies is also investing in Puerto Rico, where it owns a 30% share in AES’ 485 MW portfolio of contracted solar and battery energy storage systems (BESS), including 285 MW/1,140 MWh of grid-scale batteries. Combined, the Caribbean portfolio is expected to generate 2.5 TWh of electricity annually.

The integration of BESS into solar projects has been identified as a crucial technical element in enhancing grid reliability in island economies plagued by intermittency and legacy grid constraints. TotalEnergies’ existing footprint in the region—covering LNG supply in Panama and the Dominican Republic, retail fuel networks, and aviation fuels—positions it to offer a uniquely diversified energy value proposition across the Caribbean archipelago.

What does the Portugal asset sale reveal about TotalEnergies’ renewables monetization model?

While expanding in the Americas, TotalEnergies is also pursuing asset monetization in Europe. The sale of 50% of its Portugal renewables portfolio is consistent with its “business model for renewables,” which emphasizes asset rotation to enhance capital efficiency. This model allows the Paris-based energy major to co-develop renewable assets, retain operational control, and recycle capital to fund newer opportunities in high-growth regions.

The Portuguese portfolio includes wind, solar, and hydroelectric assets with an average operational age of 16 years. Even after divesting half its stake, TotalEnergies will continue to operate the assets and, once their existing regulated tariffs expire, it will buy back the electricity for commercialization under market conditions. This structure ensures long-term offtake optionality and maintains its electricity trading leverage in Southern Europe.

Olivier Jouny, senior vice president of renewables at TotalEnergies, stated that the Portugal transaction enhances sector profitability while optimizing capital deployment in line with the company’s integrated electricity strategy.

What are the financial implications of these transactions for TotalEnergies’ renewables strategy?

From a financial standpoint, both deals reflect TotalEnergies’ ability to simultaneously scale and de-risk its renewables platform. The Caribbean acquisition does not disclose a specific transaction value but gives TotalEnergies exposure to contracted generation in U.S.-influenced electricity markets. Meanwhile, the Portugal divestment recovers nearly €180 million in cash and values the asset base at €550 million, providing a benchmark for mature portfolio valuations in Europe.

Institutional investors tracking TotalEnergies’ performance view these twin transactions as reinforcing its renewable electricity goals: reaching 35 GW of gross renewable capacity by the end of 2025 and generating more than 100 TWh annually by 2030. As of Q1 2025, TotalEnergies reported 28 GW of installed gross renewables. With both scale and flexibility in mind, the group continues to allocate capital dynamically across developed and emerging markets.

How are institutional investors viewing TotalEnergies’ approach to renewables amid a shifting energy landscape?

Institutional sentiment remains broadly constructive on TotalEnergies’ renewables trajectory, particularly its hybrid model combining operational control with strategic capital recycling. Analysts interpret the company’s preference for joint ventures and minority acquisitions as a hedge against policy volatility while enabling market entry in otherwise high-barrier jurisdictions.

The AES deal aligns with growing investor preference for de-risked, contracted power assets with integrated storage, while the Portugal partial divestment appeals to long-duration asset managers seeking stable cash flows in Eurozone infrastructure. Both moves strengthen TotalEnergies’ environmental, social, and governance (ESG) profile—another point of attraction for global investors who continue to shift away from pure fossil exposure.

In the longer term, the company’s strategy also hedges against region-specific regulatory risks and leverages diversified income from operations, offtake agreements, and service station retailing.

What can be expected next from TotalEnergies’ global electricity and renewables expansion roadmap?

Looking ahead, TotalEnergies is expected to continue executing capital partnerships and asset rotations to fund its aggressive renewables expansion. The Caribbean model may serve as a blueprint for other LNG-linked regions where the French energy company already holds physical or retail assets—such as Africa, Southeast Asia, and parts of Latin America.

Its renewables roadmap also leans heavily on BESS integrations, particularly in isolated or unstable grids. Market participants expect TotalEnergies to further expand co-located solar + storage projects and push into firm power offerings, supported by gas-fired backup or hydro.

With its 2030 target of over 100 TWh in annual clean electricity production, TotalEnergies is positioning itself not just as a low-carbon generator but as an integrated energy solution provider. While questions remain around scalability in less regulated markets, the dual strategy of building and selling is likely to remain the cornerstone of its capital-efficient growth.