TotalEnergies Buys 50% of EPH Flex-Gen Fleet in €5.1B Power Push

TotalEnergies (TTE) has agreed to acquire 50% of Energetický a pr?myslový holding’s (EPH) flexible generation platform—spanning gas-fired plants, biomass units, and batteries—in a €5.1 billion all-stock transaction that deepens the French major’s integration of gas, LNG, and power across Europe.

The deal, valuing the portfolio at €10.6 billion (7.6x expected 2026 EBITDA), will create a 50/50 joint venture between TotalEnergies and EPH, placing more than 14 GW of flex-gen assets under shared industrial management. TotalEnergies will issue 95.4 million new shares to EPH, making the Czech group one of its largest shareholders with about 4.1% of its capital.

The acquisition gives TotalEnergies immediate scale in Europe’s most profitable power markets with 14 GW of operating and under-construction flexible generation capacity and 5 GW of development projects—positioning the company to deliver “clean firm power” as data center electricity demand accelerates.

The move marks the most significant milestone yet in TotalEnergies’ push to build an integrated power business spanning renewables, gas supply, energy storage, and flexible generation. The company already holds a leading LNG import position in Europe, and combining that with dispatchable gas-fired capacity strengthens its ability to capture margins along the gas-to-power chain—particularly between the U.S. and European markets.

The acquired assets, located in Italy, the UK and Ireland, the Netherlands, and France, add an estimated 15 TWh of net annual power production (rising to 20 TWh by 2030), enabling TotalEnergies to monetize roughly 2 million tonnes per year of LNG through power generation. The portfolio also benefits from secured capacity revenues, which account for around 40% of gross margin and help buffer volatility in wholesale power markets.

Here is a breakdown of the assets:

• Italy (7.5 GW): Includes two next-generation CCGTs under construction, some of Europe’s most efficient units.

• UK & Ireland (7.1 GW): Mix of operating gas and biomass plants plus batteries under construction.

• Netherlands (3.6 GW): Gas plants strategically located to serve the German market, with battery projects in progress.

• France (1.1 GW): Mainly battery development.

The JV will also serve as the preferred vehicle for future flexible-generation investments in these markets.

The transaction is immediately accretive to TotalEnergies’ free cash flow per share. The company expects about $750 million in additional annual available cash flow over the next five years—well above the incremental dividend burden from issuing new shares.

Integrated Power, previously forecast to turn free-cash-flow positive by 2028, is now expected to do so in 2027. The segment’s ROACE target will rise from 10% to 12% over the same period. TotalEnergies also cut its annual net Capex guidance by $1 billion to $14–16 billion for 2026–2030, while maintaining its target of 100–120 TWh of electricity generation by 2030.

The acquisition underscores a broader shift among European majors toward building flexible, dispatchable capacity to complement intermittent renewables. As power systems decarbonize, the surge in data centers and electrified industry is driving demand for firm generation—especially CCGTs and battery storage.

For TotalEnergies, which already operates 32 GW of renewables globally, the deal tightens its competitive foothold against utilities and energy traders in continental power markets. EPH, meanwhile, secures a strategic position as a long-term shareholder in one of Europe’s largest integrated energy companies.

The transaction remains subject to regulatory approvals and employee consultations, with completion expected by mid-2026.

By Charles Kennedy for Oilprice.com

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