The Renault Group is collaborating with French utility Engie on the development of a geothermal energy project at the automaker’s Douai facility. The partnership is set to last 15 years.
Renault announced Thursday that a subsidiary of Engie will begin drilling work at the Douai assembly plant in late 2023. The plant, which focuses on bodywork assembly, was established in 1970.
The plan is to take hot water from a depth of 4,000 meters, or more than 13,100 feet. This hot water will be used to generate electricity.
Renault has announced that it will use water from a nearby power plant to help meet the needs of its Douai site from 2025. The water, which will be between 130 and 140 degrees Celsius, will be used for industrial and heating purposes.
The company said that once implemented, this geothermal technology would provide a power of nearly 40 MW continuously.
Geothermal energy could be used to produce carbon-free electricity in summer, when the need for heat is lower, according to the report.
The Renault Group's CEO, Luca de Meo, described the program planned for Douai as "one of the most ambitious decarbonisation projects on a European industrial site." He went on to say that the project would help the company meet its goals for reducing emissions and promoting sustainable development.
Geothermal energy is a type of renewable energy that comes from the heat inside the Earth. This heat can be used to generate electricity or to provide direct heat.
The U.S. Department of Energy says that geothermal energy is a renewable source of power that is available around the clock and emits little or no greenhouse gases.
Renault is working with Engie on a geothermal project that is part of the company's larger effort to decarbonize its operations. The project is one of several that Renault is undertaking to reduce its carbon footprint.
Renault is targeting carbon neutrality in Europe by the year 2040 and globally by 2050. This is part of the company's larger goal to reduce its environmental impact.
Despite its aims, a top executive at the firm recently told CNBC that the firm sees the internal combustion engine as continuing to play a crucial role in its business over the coming years.
Earlier this month, the Renault Group and Chinese firm Geely announced a non-binding framework agreement to establish a company focused on the development, production and supply of hybrid powertrains and highly efficient ICE powertrains. This new company will help Renault and Geely meet the growing demand for more fuel-efficient vehicles.
In an interview with CNBC's Charlotte Reed, Renault Chief Financial Officer Thierry Pieton discussed the reasoning behind the planned partnership with Geely. Pieton said that the partnership would allow the two companies to share resources and expertise, and that it would give Renault access to Geely's strong sales network in China.
"We believe that ICE and hybrid engines will represent at least 40% of the market by 2040," he said. "So it's actually a market that's going to continue to grow."
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Citi upgraded Tesla's stock on the belief that it offers a "balanced" risk-reward at current levels. The firm sees Tesla as a leader in the electric vehicle market with a strong brand and growing demand for its products. However, Citi also acknowledged that Tesla faces challenges, including execution risk and competition from well-established automakers. Overall, the firm believes Tesla's stock is attractive at current levels.
Goldman Sachs has released a report saying that electric vehicle (EV) batteries are becoming increasingly critical, and has named two stocks that it believes are well-positioned to benefit from this trend. The report notes that the cost of EV batteries has fallen sharply in recent years, making them a more viable option for a wider range of vehicles. Goldman Sachs believes that this trend will continue, and that EV batteries will become increasingly important in the coming years.
Renault is continuing to focus on the internal combustion engine, even as some major economies are looking to move away from vehicles that use fossil fuels. This is an interesting choice, and it will be interesting to see how it plays out in the coming years.The United Kingdom, for example, has proposed banning the sale of new diesel and gasoline cars and vans by 2030. All new cars and vans would be required to have zero tailpipe emissions starting in 2035.
The European Union, which the U.K. left on Jan. 31, 2020, is pursuing similar targets to those set by California. Over in the United States, California is banning the sale of new gasoline-powered vehicles starting in 2035. This move is sure to have a ripple effect across the globe, as other countries begin to reassess their own environmental policies.
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