What is being done about clean energy right now, how the railways of the future will work and why "energy storage" is not a problem any more? Learn that from the interview with Francesco Venturini, Head of Enel X, within the framework of FT Energy Transition Strategies Summit. Russian version here: http://plus-one.rbc.ru/blog/economy/franchesko-venturini-miru-megapolisov-nuzhna-novaya-infrastruktura
Source: Enel Green Power
What are the key areas of development for Enel X in the next 2-3 years?
We have three big areas of development. One is urban infrastructure, meaning that in a world that goes very fast towards big urbanization, which means that in a few years we will have a lot of megalopolises around the world (10-15-20 million people in one single place). You need the infrastructure to deal with it. We come from the business where we obviously have infrastructure- electric infrastructure in big cities. But then my business (Enel X) is not to build wires or transformers, my business is to make sure that there are services to the people.
So, when we are talking about public infrastructure we are talking about public lighting in particular, we are talking about electric mobility, we are talking about the electrification of consumption as well. We have added fiber optic business as well. We have started in Italy right now, so we are looking around the world to see if it makes sense to develop also elsewhere. Potentially Latin America where we essentially serve the big cities with our infrastructure network business.
Photo souce: cleanenergysummit.org
The second direction is the concept of energy as a service. The consumers, that now are much more conscious of the fact that they need careful of the environment, of that they get punished by their consumers, people that buy products with them- that’s number one. The second thing- they understand that energy is expensive, so they need to save money. We help them to understand where they spend the money, we help them substantially saving money. There are different ways of doing that. Simple one is to rebuild the infrastructure within the factory, within the building; other ways are just serve helping them to procure energy in the market, advising them how big we do things in a different way. I will say that that’s probably the main area where you see a big push towards energy efficiency.
The third direction is opening the market to the demand side. We are moving very fast towards the word where there is going to be a high percentage of renewables. Renewables are fantastic. When substantially that 5% max 10% of energy generation in particular system, when you go above, the system is not capable to use all that energy without becoming more expensive, so you need to open the market to different technologies. In particular, you need to open the market to the demand side management. Which means that customers are participating in the market.
That is the concept of flexibility. So, demand response, demand side management, vehicle-to-grid- everything that allows our customers to participate to the market. So the first and the second one, we are talking about urban infrastructure, we are talking about energy as a service. Essentially, we are providing the service to the final consumer, he pays for it. The third one is very peculiar, because instead of having them buying the service, you make sure that they have open access to the market, so they make money through you.
What about such trends as digitalization, decentralization. How are they being implemented within Enel?
When you look at these three streams substantially, then you have another two that are the ones that are supporting your strategy. One is the digital hub. Even if we are talking about infrastructure now, we are talking about digitalized infrastructure. The element of digitalization in all our business is extremely high. And the second is, another department which we call the product lab. We are always looking for innovations within what we do. We have a big number of people that are looking at other technologies developing, looking at startups, how the business models are evolving and then try to incorporate them in what we do.
What about Blockchain?
Honestly speaking, it is something that is not a part of our business yet. I understand how it works, I understand that it finds application right now in specific things, but I have not been able to find the way of using it in what I do in a value creative way. We have people studying it within Enel, but me, personally, I don’t use it.
Recently Enel X has made public its plan to install an electric vehicle charging network in Italy. What other countries will be next, or is it just Italy-specific project?
We are starting with infrastructure in Italy, the next step is going to be Spain. The third step is going to be Romania. In a reality, we are already building infrastructure in Chile. It’s just for public transportation. So, I think it is going to be worldwide, that’s the infrastructure we build and operate, but we are selling our technology pretty much all over the world. In the United States and Russia we have we have an office and we have people selling wall box charging stations in Moscow.
Which projects are Russia-specific ones?
We have two right now main projects in Russia. One is related to electric vehicles, so again we have people, we have an office. We will probably assembly our wall boxes (wall box charging stations) in Russia and sell them to the people buying electric vehicles. Second thing- we are working a lot with energy storage right now.
The concept with railways is actually pretty interesting. We are testing in Russia first with objective of then exporting it all over the world. Trains have, depend on the character of the specific country, very high need of power every time they start from the train station. Because that’s the moment when they suck all the power out of the grid. The way to create the big pick up of power at this moment is to put energy storage close to the station.
You do two things, you do charge it directly from the grid and you recharge it partially when the train is slowing down. When it slows down, the energy is created that goes to the battery, when it starts it uses the energy saturated in the need of power. And then there is a third thing which is extremely important. You have a station in the place "A" and you have a station at place "B". In Russia and in the United States, in all countries where there are very long distances, usually you have a lot of power. You have substation at the station. And then you have nothing in between.
What happens is when you are in the middle between the two stations, you have problems with stability of the grid. The train goes further and further away from where the power and electricity are injected in the system and when they are in a middle there are risks that you are not going to have enough power and the train stops. So you have problems in Russia, but not only in Russia, it's pretty much the same thing. When you have very long distances between the different stations, if you put the battery in the middle you can solve the issue. We are studying with “RzHD” how to manage this power. If it works, it's going to be a very good project.
Today at the Financial Times Energy Transition Summit I heard that the shortage in energy storage facilities is the main issue that slows down the expansion of renewable energy…
It slows down the renewable energy, that’s what they said? If I look at what’s happening right now in the market, batteries are getting cheaper and cheaper. The chemistry that is used is becoming more and more efficient. We know already which manufactures are buying and what price and trust me its not what you see on the papers, on Bloomberg right now. The price is going down extremely fast. Actually, the problem is different. I mean there is not enough capacity in the market right now. So they need to build more capacity, which some nations are building.