Continuation of the interview with Kristina Baloghová, Head of Energy Services, on the importance and benefits of developing decarbonisation strategies. In the interview we will talk about:
- What should a tender for decarbonisation strategies look like?
- How do our clients approach them? What motivates them, do they postpone the preparation of the strategy for later and what problems do they face?
- Are they putting the prepared strategy into practice?
- Are they interested in using RES (renewable energy sources)?
- Does ENGIE also address decarbonisation in Slovakia? How?
What does the preparation of a tender for decarbonisation strategies look like? What information should clients keep in mind and what should the tender contain?
At ENGIE, decarbonisation strategies are prepared by the Energy Services team. For us, it is crucial to get as much information as possible regarding energy consumption. We also appreciate as much detailed project documentation as possible on existing technical equipment, systems or piping routes.
In the tender, it is good to know what the customer’s preferences are in this area, because the topic of decarbonisation is broad and everyone perceives it differently. In addition, there should be a team on the client’s side that can fully commit to the whole project. And it should be mentioned here that an indispensable member of the team is the plant technologist, who is familiar with the reasons for developing the strategy. Moreover, he does not take this topic as an extra problem, but, on the contrary, is ready to support its development and subsequent implementation.
In your experience, what motivates clients to prepare a tender?
Today, companies know that, even if not directly to save the planet, but for pragmatic competition, they must reduce emissions. Last but not least, because of high energy prices, they are forced to reduce energy consumption and save.
The theoretical preparation of a strategy looks simple, but practice can be different. What problems do you encounter in strategy development and how do you solve them?
The biggest problem is usually with the project documentation. Plants have a long history and since many of the systems in their plants were installed more than 30 years ago, it is often difficult to find the necessary documentation. However, we are able to cope with this, as our colleagues create their own documentation during inspections.
Do clients realise why creating a decarbonisation strategy is important for them right now? Or are they postponing their decision until later?
Particularly because of the energy crisis, most clients are realizing why it is important to upgrade technology. In practice, we see plant management deciding to link decarbonisation with modernisation and using this strong incentive to demonstrate their environmental objectives.
Decarbonisation has a positive impact on plant costs. Whether by reducing greenhouse gas emissions payments or by directly reducing energy costs. One of the benefits of the strategy is that it helps the client to plan for current and future energy expenditure.
What is the feedback from clients? We have created strategies for companies and municipalities. With what result? Have they ended up based in a drawer or are our clients actively using them?
Companies are actively using them. In addition, we often extend our cooperation because ENGIE can offer clients the implementation of services that we propose directly in the strategy. Whether it is the monitoring phase, data collection, evaluation, design or the actual implementation. We also offer PPA (Power Purchase Agreement) projects, which are still in their infancy in Slovakia. Under a PPA project, ENGIE finances the installation of the equipment and then supplies the client with energy at a pre-agreed price. In addition, we can offer energy management services to companies after the investments have been made.
As we have already mentioned, the use of renewable energy sources (RES) is a resonant topic at the moment. Is there any interest in these services and the supply of energy from RES from clients?
The interest is huge. It’s a bit more complicated because renewables are also not completely free. But it is an excellent complementary source. Most clients nowadays, for example, are having the profitability of installing photovoltaic systems assessed.
Wind energy is still in its infancy in Slovakia, but on the other hand we have excellent conditions for the use of geothermal energy.
Today, the use of biomass as a renewable resource is also coming to the fore. However, for biomass, environmental and economic considerations need to be assessed. For example, whether we can keep to the length of the transport route of the biomass itself so that we can still talk about green fuel and so that it is profitable for the client.
Nowadays, waste heat is also often discussed, which is also a good investment from our point of view, as clients use the heat they have already produced during operation.
At ENGIE, we ourselves have set clear decarbonisation targets, including, for example, achieving zero carbon emissions by 2045. To meet them, we need to adapt our operations and efforts to them. More specifically, we are increasing the use of renewables within our operations.
That’s right. ENGIE operates 18 thermal farms. And as an entity operating in the thermal energy market, we are obliged to have a plan in place for the transition to renewable energy sources. By 2026, we should be supplying 50% of the heat produced from renewable energy. ENGIE is building its own photovoltaic power plants, using heat pumps and trying to transform existing heat farms into efficient district heating (district heating) by modernising them.
Due to climate change and warmer winters, heat production is decreasing realistically and statistically. For us, with a view to decarbonisation, this means that we will be making more use of existing biomass boiler plants at the expense of gas-fired ones. We can gradually phase these out, while at the same time re-circuiting the heating systems and linking them to the biomass boilers to create efficient CHP. The aim is to make thermal energy low-emission as well.
We are currently starting up the first biogas plant at ENGIE. This will allow us to use green biomethane in our system. This is particularly advantageous for us in locations where we cannot install heat pumps or biomass boiler plants due to dense housing.
In addition to the design and development of decarbonisation strategies, ENGIE also offers clients implementation, financing, operation and energy supply. From your point of view, is it advantageous for clients to use the services of one company and get a stable energy partner?
In my opinion, this is the best solution for the client. Only from a logical point of view – a company that proposes a solution and knows in advance that it will also implement and operate it itself, takes care to prepare it as best as it can, because the delivery of other services will be in its own hands.
