By ENGIE | 18 October 2016
SIEW 2016: 5Qs with Isabelle Kocher, CEO, ENGIE
About Isabelle Kocher
Isabelle Kocher is the Chief Executive Officer of ENGIE (previously GDF SUEZ). Before her current role, she served as Deputy CEO and Chief Operating Officer of the Group between 2014 and 2016, following her appointment as Chief Financial Officer in 2011. Mrs. Kocher joined the Suez Company in 2002 and has held various functional and operational positions over the past 12 years. Previously, she held numerous roles in the French Prime Minister’s Office and Budget Department.
Mrs. Kocher has been honoured with “chevalier de la légion d’honneur” and a “chevalier de l’ordre du mérite” and is a member of the Boards of Suez and AXA Group. She is also the Chairman of Terrawatt Initiative, a global non-profit organization aimed notably at promoting competitive solar power and raising awareness of the global public opinion on the emergency of a successful energetic transition.
1. How are ENGIE’s business priorities aligned to meet the opportunities and challenges brought about by these new energy realities?
The energy transition is a profound and positive transformation, one that presents a formidable challenge. To address the new energy realities, we are focusing our developments in three areas: Low-CO2 activities, which will represent 90 per cent of the Group’s EBITDA by 2018; integrated solutions for our customers; and gas and electricity networks.
In 2016, we launched an ambitious three-year transformation plan based on five pillars: (1) redesign and simplify the Group portfolio of activities, (2) improve operational efficiency and competitiveness, (3) pave the way for the future by investing in innovation and new technologies, (4) engage a digital transformation, and (5) adapt the Group to make it more agile and connected, based on a simplified organisation which is closer to the customer.
2. What is your outlook for Asia’s low-carbon future, given the region’s strong coal demand?
The 21st century will mark the end of fossil fuels, which will gradually be replaced by energy from decarbonised renewable resources. Alongside large-scale plants that generate energy for entire regions, we will see the emergence of a multiplicity of decentralised local generation facilities. And digitalisation is accelerating this movement.
The future of energy in Asia will see new, disruptive technologies positively increase the uptake of renewable energy solutions, as prices drop below those of traditional energy sources. With decentralised generation and storage systems available at increasingly affordable costs, micro grids will become a more frequent feature in rural areas, bypassing the need for large, connected infrastructure.
As Asia’s energy demand will rise by more than 80 percent in the next 20 years, a key opportunity lies in adopting energy strategies that provide affordable energy for all without resulting in an exponential growth of greenhouse gas emissions. From both an economic and environmental viewpoint, there is a need to diversify Asia’s energy mix and explore the huge potential of solar, wind and geothermal energy.
Solar power has become competitive – its price is now one-eighth of what it was five years ago – and now represents a viably exploitable energy asset for many countries. This accessible resource is twenty times the level of global energy consumption and renewable by definition. For the first time, we are seeing an opportunity to provide energy from non-polluting sources to those who have no access to it.
3. How will the decentralisation of energy production impact utilities and their interactions with consumers?
With decentralised energy production, consumers can effectively become “prosumers”, i.e. producers and consumers at the same time. For example, when they install rooftop solar panels for their own energy use, they become energy producers. As a consequence, they will consume less from the grid, and if regulations allow, they can even supply energy to the grid. More importantly, this means that they can shave their peak-consumption if it coincides with the sunny hours.
Equally important is that utilities can also shave their peak production need, if many prosumers do this. With the right incentives and smart technology, production and consumption can be optimised in the benefit of both the utility and the consumer, who become partners that rely on each other. Instead of the traditional one-way street, it becomes a more resilient, two-way relationship.
ENGIE has worked for many years on offers and services to accompany the energy decentralisation, and to adapt to the needs of its customers on energy issues - including, for example, storage, solar panels at home, and micro-grids, etc.
4. What more can be done to reap the benefits of energy efficiency?
With demand for energy increasing to fuel rapid economic growth in the region, an important but often overlooked element is energy efficiency. The greenest energy is energy that has not been used. ASEAN has an estimated potential power savings of between 12 and 30 per cent, which translates into savings of USD15 billion to USD40 billion.
A holistic approach to optimise energy usage will bring greater benefits and increase cost savings. Policy makers can incentivise energy efficiency by cutting fuel subsidies. Energy literacy amongst consumers and attitudinal changes will drive energy efficiency more than technological revolutions will.
The energy industry has a role to play in promoting energy efficiency and professionalising the industry from within by setting efficiency benchmarks and standards. Multinationals such as ENGIE can help to catalyse the adoption of energy efficiency by bringing in best practices learned from their experience in other countries.
5. What are your thoughts on the SIEW 2016 theme “New Energy Realities”?
The SIEW 2016 theme underlines the pivotal period that the energy industry is in – combating climate change, while at the same time, meeting soaring energy demands in a resource constrained environment.
At ENGIE, we are convinced that there is an opportunity to reconcile the needs of sustainability and access to energy for all. To do so, the energy industry has to overcome three challenges:
- Time horizon management – Although some renewable energy solutions, like hydrogen, are not expected to be mature in the short term, we need to begin work and investment today to ensure that the technologies of tomorrow are properly developed.
- Value creation – The energy revolution and change in the energy mix will see a shifting balance to low-carbon options like gas and renewables. At ENGIE, we have made the commitment to dispose €15 billion of assets which are not at the core of our future, and are committed to turning away from coal plants.
- Managing eco-systems – With the transition to a decentralised model, success will depend on collaboration and co-innovation of solutions from government, industry partners, clients as well as the general population. Building such partnerships will help to shape the landscape in energy management, influence consumer behaviour, highlight best practices and create the platforms to share that. Managing this eco-system effectively is an ability that every organisation can and should learn.
Whilst these challenges are not easy to meet, I am convinced that we have both the will and the means today to achieve this ambition.