Analysis
TotalEnergies faces moderate headwinds from the U.S. tariffs introduced in April 2025, with the primary impact concentrated in its Integrated Power (renewables) segment and new project sanctioning in the United States. Management has stated that existing large-scale projects, such as trains 1-3 of the Rio Grande LNG project, are not affected by the new duties as they were secured under previous contracts. However, the company has put certain future investments, particularly in offshore wind, into a "sleeping mode" due to the combined effect of higher costs and regulatory uncertainty.
The most direct financial impact noted by the company is a decline in expected returns for specific U.S. renewable projects. Management cited one solar project where returns dropped from approximately 12% to under 10% following the tariff implementation, prompting a "pause" on that development. For projects that proceed, TotalEnergies is actively diversifying its supply chain to mitigate costs, such as replacing a Chinese supplier with a Vietnamese provider for a U.S. solar project. The company is also monitoring potential taxes on non-U.S.-built LNG vessels, given that a significant portion of the global fleet is constructed in China.
To offset the negative impacts on its U.S. investment case, the company is looking toward potential mitigating factors from the same administration, specifically the possibility of lower corporate income taxes. Additionally, TotalEnergies is leveraging its integrated model by signing high-premium power purchase agreements (PPAs) with U.S. data centers, which helps bolster returns in the Integrated Power segment. Management has also launched a company-wide $12.5B cash-saving and resilience program for 2026 to strengthen its balance sheet against a more challenging macroeconomic environment.
Outside of the United States, TotalEnergies reports no significant impact from the April 2025 tariffs on its global projects. The company continues to prioritize "value over volume," asserting that it will only grow at a pace allowed by the global economic framework and will not overreact to trade policy shifts. Despite these headwinds, the company maintains its long-term guidance and reported a 120% reserve replacement rate for 2025, underscoring the resilience of its core oil and gas portfolio.
Data
U.S. Tariff Impact and Mitigation Metrics
| Metric | Impact / Value |
|---|---|
| Project Return Headwind (Specific Solar Project) | 200bps (12% to <10%) |
| 2026 Cash-Saving and Resilience Program | $12.5B |
| North America Renewable Installed Capacity (2Q25) | 5.5 GW |
| North America Gas Power Generation (2Q25) | 1.5 TWh |
| Global Renewable Capacity Addition Target | 8.0 GW / year |
Source: Transcript 1Q-2025, Transcript 2Q-2025, Transcript FY-2025
Sources
This project was more or less around 12%. With tariff, it's less than 10%. We say pause. We are not in a hurry. It's not volume, not of value.
There is one segment which has completely, we put into, I would say, a sleeping mode. It is offshore wind. This is completely sleeping now.
For TotalEnergies, projects outside the U.S. are not currently affected by tariffs. ... To be clear, it's not an issue.