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Global energy company Total has signed a €515 million deal with EDP to become the fourth largest gas and electricity supplier in Spain.

Once the deal is approved by regulatory officials before the end of 2020, Total will acquire a portfolio of around 2.5 million residential contracts.

Total will also acquire 280 employees of EDP and two gas-fired combined cycle power plants, which represent an electricity generation capacity of nearly 850MW.

The deal means Total will serve 12% of residential customers within the Spanish gas market and 6% of residential consumers within the electricity sector.

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The development follows Total entering the Spanish solar market in February 2020 with the acquisition of a portfolio of almost 2GW of renewable power projects.

The deal with EDP helps Total to achieve its goal of becoming carbon neutral by 2050 globally.

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Patrick Pouyanné, the CEO of Total, said: “This is a major new step in Total’s ambition to become a broad energy company. This transaction enables Total to become one of the key players in the energy market in Spain, covering a wide spectrum from LNG imports to power generation from renewables and gas, as well as gas and electricity supply. Our ambition is to be able to bring a competitive offer from our productions to the Spanish consumers, drawing on the digital and commercial know-how developed in France by Total Direct Energie and in Belgium by Lampiris.

“This transaction is fully consistent with the Group’s strategy of profitable growth across the gas and low carbon electricity value chain in Europe, in line with our new ambition to get to Net Zero Emission by 2050. With this deal Total will reach 8.5 million gas and power customers in Europe from 2021, on track with its ambition to serve over 10 million customers by 2025”.