There are many energy companies in the news right now talking of an about turn in their focus, getting out of fossil fuels as fast as they can, and adopting renewables. At the Future of Utilities conference, Wilfred Petrie, UK CEO of French energy firm Engie, talked about the company’s decarbonization and services strategy.
Already Engie is making the news, mostly for selling off coal based assets, and bidding for more offshore wind farms. Engie sold off its 69.1% shareholding in Thai generator Glow for €2.6 billion just two weeks back and last month submitted a bid for a 750 MW subsidy-free offshore wind farm off the costs of the Netherlands for the Hollandse Kust development zones. It will have to win out against Orsted, Vattenfall and a consortium of Shell, Eneco and Van Oord called Witwind.
Shell this week, and GE at its results talked a good game in renewables, but both included gas as if it were a “renewable” which clearly it isn’t – since when it burns it gives off CO2. Engie doesn’t make those kinds of mistakes and Petrie is a passionate on the subject of real zero carbon energy and does not fudge the issue. He talked up the distribution of energy and Engie’s shift from generation into services.
Engie is a €60 billion business and in the UK supports some 17,000 employees, and Petrie said the company wrote off £20 billion in assets by getting out of fossil fuels. He said the company had closed a 100 MW coal fired plant last year. Back in 2014 Engie was certainly larger with a €75 billion in revenues “The entire energy business is rebuilding itself,” he said, “Stage one is to get to zero carbon, but it will not end there,” he said.
“There is more to come, Energy will become decentralized and it is about Cities and places. Energy will have to become embedded into buildings,” he said, and here he was talking about large public buildings and enterprises. It was Petrie who was the first voice at the show who singled out building regulations in the UK as the right instrument, and he talked about PV on every rooftop. Much of the show was focused on Grid and Network Operators discussing technical improvements to the grid to make it work better with renewables, but his focus was on enabling distributed energy.
Engie today is in the building renovation business and said it has installed PV into 100,000 homes and Petrie said “By 2025 every new home will be fitted with heat pumps powered by PV, instead of gas boilers, and in East London we have a district energy project that we have invested £100 million in,” said Petrie. “We shall be following this with deals to be announced in Southampton, Birmingham, Leicester, Coventry and Newcastle,” he added.
And he got excited about Electric Vehicles, talking about bringing electricity to them from Engie’s charging technology, and talked about experiments in West Yorkshire Taxis and finding the best places to charge them, and how to keep them charged while on the road. “EVs will make up 25% to 50% of cars by 2030,” he said.
“We are into place making – helping to make it happen, with new low carbon infrastructure,” which is in fact the company’s raison d’être. “We don’t make so much money now,” he lamented, but claimed that Engie was one of the top 3 facilities management companies in the country and that this would drive the company’s value.
Back in November Engie acquired an IoT firm called Smart Buildings and he said this was to give customers an improved building management experience, which is clearly expected to include all energy. Engie clearly believes that more and more buildings will need energy contracts for their buildings, built around renewable energy and around uses less of it.
“We believe that the bigger market is local energy production, and will be looking for corporate Power Purchase Agreements built around zero carbon.
An interesting vision.