Energy is the greatest concern of our future

By 2035, a newly shaped energy world is envisaged, that uses a much more diverse range of electricity and heating sources, with significantly lower emissions and where all new vehicle are electric. Achieving this vision will not be easy and industry is clear that achieving success in power generation, heat and transport will require strong leadership from Government, from companies, a stable policy framework and for system planners and regulators to take a whole systems approach.

The next decade is expected to be among the most transformative the energy sector has ever seen and the energy production is at the forefront of this process: making new investments to ensure the system is fit for the future.        

This will open up new opportunities to manage the energy system in a more efficient way which will help increase energy efficiency, reduce GES and keep energy bills down. The most effective way to sustainably reduce energy bills remains through energy efficiency improvements.

CHP (Combined Heat and Power) technology can be deployed quickly, cost-effectively, and with few geographic limitations. If modernized, CHP applications can operate at about 85% efficiency, a significant improvement over the national average of about 50% for these services when provided separately. CHP can use a variety of fuels, both fossil- and renewable-based. It has been employed for many years, mostly in industrial, large commercial and institutional applications. CHP may not be widely recognized outside industrial, commercial, institutional, and utility circles, but it has quietly been providing efficient electricity and process heat to some of the most vital sectors and residential consumers.

The changing system and the decarbonisation imperative will create new roles, interactions and dependencies, bringing with them new opportunities, but also creating a number of challenges to overcome.

The new energy leader

This industry needs a new breed of leadership. „Accelerators” are needed, because of their ability to mobilize, execute and transform with agility and vision. The new energetic paradigm clearly points to a shift in the attributes and behaviours needed for leaders in the energy industry for the next decade.

It’s not only about resilience, foresight and driving results, but also about disrupt and challenge. The energy industry has traditionally been the land of technical people. Since the start of the transition, technically oriented leaders have been joined by economists and environmental leaders, as energy production is often linked to the economic, environmental and climate change debate. The fact that the energy industry is likely to turn step by step into a transformed world, where customer behavior and energy flows are managed and controlled with the help of smart technology, adds requirements to the profile of the future CEO. The new energy leader has to be exceptional and collaborative in innovating and leveraging technology. He has to be more resilient and agile, while also prioritizing learning, innovation and inspiration. 

Relate like a diplomat

The regulatory pendulum swings further in the direction of greater government, ministerial and local intervention. This means that there’s a need to work in even closer partnership with the relevant decision making factors on a series of issues that include investments, energy security, climate change, cybersecurity. Energy production is a matter of energy security. The International Energy Agency(IEA) defines energy security as the uninterrupted availability of energy sources at an affordable price. Cogeneration power plants are sources of security energy, as they generate power constantly and flexibly even when the sun isn’t shining or the wind isn’t blowing, essentially complementing renewable systems that produce electricity intermittently.    

Bucharest needs energy security. It cannot rely on electricity alone. It also needs heat. Large urban areas like Bucharest with high heat demand density, need energy provided in a centralized manner.  Accelerated investments in new CHP plants are an imperative. The energy transition is a real opportunity. The centralized heating system in Bucharest is in a situation where it has to renew its production capacities, as well as the network. We have the chance now to renew production capacities and adapt them to new efficiency and environmental goals. In combination with renewable energy and storage, ELCEN (the main heat supplier of Bucharest DH system and one of the biggest energy producers at the national level) can contribute to the resilience of the National Energy System.

In addition, the urgent rise in environment, social, and governance (ESG) accountability are together requiring business executives and government officials to manage an increasingly overlapping landscape of stakeholders.

Environment

Beside the efforts to invest in projects that will lead to a significant decrease in the CO2 emissions, the leadership vision in ELCEN is to consider more complex initiatives to achieve effective environmental stewardship such as inviting experts with external perspectives to get information and advise. Specific plans will build both real progress and trust.

Social

As a company using natural gas for the energy generation, we have high exposure to social factors in all ESG categories. This means, we should make an intensive effort to further heighten our companies’ sensitivity in areas such as safety, health, and community partnerships. Instead of being defensive, the new scope is to articulate the social benefits of the activity  in a balanced, informed, and compelling manner.

Governance

Good governance in the generation sector has become more crucial than ever. Operating under a good governance framework will help us to become and remain competitive and sustainable in the long term.

The challenge for an energy company like ELCEN, is that you can’t just flick a switch to become a ‘greener than green’ company with perfect ESG credentials. The energy transition involves enormous amounts of planning, development, and investment, and that takes time. It’s a message for the large public, which is difficult to come to terms with – leaving some energy companies being painted in an unfairly bad light. 

Taking robust steps

This year, ELCEN submitted applications for non-reimbursable funding for three new power plant projects that will be able to generate safe and constant power, with high energy efficiency. We also have the main resource of the energy transition: natural gas. Neptun Deep could produce a significant amount of gas starting in 2027. The EU considers natural gas a transition fuel.

Also this year, we signed an agreement with the Department of Energy in the United States of America for the identification of investment projects using the geothermal renewable resource within the Bucharest district heating system. Also this year, we submitted the project “Feasibility Study for the integration of solar and wind power in district heating systems with advanced heat storage solution” to Innovation Norway and we are on the waiting list. At the same time, we submitted a project for the construction of a photovoltaic park for self-consumption and an energy storage unit.

All these investment objectives started during this year are the result of an integrated vision, applied in due time, for an effective approach to the situation of the Municipality of Bucharest, both from the point of view of heating and electricity supply, considering that electricity consumption will increase.