WEBVTT 1 00:00:08.119 --> 00:00:14.880 You're listening to Redefining Energy. Your co hosts from Berlin Gerard Reid and from 2 00:00:14.960 --> 00:00:22.879 London Laurent Segalan. Today on Redefining Energy job, we're going to talk about 3 00:00:23.039 --> 00:00:29.760 something we don't usually talk about. It's the distribution grids exactly the last month, 4 00:00:30.120 --> 00:00:35.000 which is incredibly critical to the energy transition and to ensuring that we have 5 00:00:35.039 --> 00:00:39.520 twenty four seven power right, which seems to be obvious way back when, 6 00:00:39.640 --> 00:00:43.920 but now it's being put into question. But first of all, from our 7 00:00:43.960 --> 00:00:49.439 partner, Redefining Energy sponsored by a Mundi, the leading European asset manager, 8 00:00:49.840 --> 00:00:55.439 your trusted partner to accelerate the transition to a low carbon future. Leading asset 9 00:00:55.479 --> 00:01:00.159 manager based on the IPE ranking. Investing involves risk can sort your financial advisor. 10 00:01:00.600 --> 00:01:03.920 Yeah, I want to start with Lauren. Is that nobody thinks about 11 00:01:03.959 --> 00:01:07.319 the wires in the ground m h. We just take it for granted that 12 00:01:07.359 --> 00:01:11.599 we have power. M But what's happening is we're seeing a lot of stress 13 00:01:11.640 --> 00:01:15.680 is taking place in the distribution grid. One is there are a lot of 14 00:01:15.719 --> 00:01:21.879 the distribution cables where are very old, the substations, the poles that they're 15 00:01:21.920 --> 00:01:23.840 on, et cetera, et cetera. The same thing and the need of 16 00:01:23.840 --> 00:01:26.400 an upgrade, and the need of an upgrade one because they're old, but 17 00:01:26.439 --> 00:01:32.439 also again because the stresses in the system, whether that's storms or it's two 18 00:01:32.519 --> 00:01:38.000 way power flows. And actually must really be clear. In most villages, 19 00:01:38.680 --> 00:01:41.840 if there was three pouses in a row which had an electric car and they're 20 00:01:41.879 --> 00:01:46.640 charging at the same time, you've got a problem. The reason I want 21 00:01:46.640 --> 00:01:48.879 to talk about this topic is for me, it's I think it's going to 22 00:01:48.879 --> 00:01:53.560 be an increasing bottleneck in the energy transition is what to do with the distribution 23 00:01:53.640 --> 00:01:57.680 grid. Yeah, because the transmission these are big projects, quite ee on 24 00:01:57.719 --> 00:02:01.359 the agenda, but if you look at the distribution grid, it's just a 25 00:02:01.400 --> 00:02:07.359 plate of spaghetti and you never know which spaghetti is gonna crease some stress. 26 00:02:07.000 --> 00:02:09.680 And you're right about TV charging, but you know, we can talk about 27 00:02:09.719 --> 00:02:14.599 heat pumps as well, and at the same time, so does the demand 28 00:02:14.680 --> 00:02:19.479 at the same time, those distribution grid needs to accommodate with the first development 29 00:02:19.639 --> 00:02:24.240 of decentralized energies such as off top soil are exactly and let's be really clear, 30 00:02:25.000 --> 00:02:30.560 it's quite a tough thing to upgrade them because it's like replacing your electricity 31 00:02:30.560 --> 00:02:35.280 system within your home and rewiring. That's tough if you think up roles, 32 00:02:35.280 --> 00:02:39.120 etcetera, etcetera. People don't like this. That's not easy whatsoever to do 33 00:02:39.159 --> 00:02:49.520 this. So how to reconcile the challenges of new local load and new supply. 34 00:02:50.240 --> 00:02:55.680 It's the challenge of decentralization while of course maintaining the grid stability while it's 35 00:02:55.960 --> 00:03:04.000 managed by local utilities, and those utilities which are all regulated either at regional 36 00:03:04.199 --> 00:03:08.039 or national level, they have a kind of slow pace and they're faced with 37 00:03:08.360 --> 00:03:13.039 the rapidity of change. By the way, a lot of these guys are 38 00:03:13.120 --> 00:03:15.000 very small, right. I know, if you go to UK, there's 39 00:03:15.000 --> 00:03:19.120 only a handful of them, but if you go to Germany or the US, 40 00:03:19.520 --> 00:03:23.439 you've got hundreds of these distribution grid operators and you could think what do 41 00:03:23.520 --> 00:03:27.439 they do? They're the man in bands. They go around and make sure 42 00:03:27.479 --> 00:03:30.919 that the poles are built in the start of the other thing. And as 43 00:03:30.919 --> 00:03:34.599 you said, there's a certain culture there and to try and change that, 44 00:03:34.639 --> 00:03:42.120 like digitalizing these businesses, trying to modernizos greed is the job of our guest, 45 00:03:42.960 --> 00:03:46.000 Robert Denda, that you've known for quite some time. So can you 46 00:03:46.039 --> 00:03:52.120 introduce Robert. Yeah, Robert is the CEO of a business called grid Aspertise, 47 00:03:52.879 --> 00:03:57.960 which is a company spun out of the Italian utility in Nel, and 48 00:03:58.120 --> 00:04:03.520 they are really one of the largest suppliers of solutions into distribution grid operators, 49 00:04:03.520 --> 00:04:10.800 so everything from smart meters to software systems. Greatspertise now is a fifty to 50 00:04:10.800 --> 00:04:16.720 fifty JV between NL and the investment fund CVC. The fifty percent was sold 51 00:04:16.720 --> 00:04:21.639 by NL to CBC for throndude million dollars two years ago. Of course they're 52 00:04:21.639 --> 00:04:26.040 at quart in Italy, but they have a presence in Spain, Brazil, 53 00:04:26.160 --> 00:04:30.800 Usa, Germany, Scandinavia. So we're going to talk about all those issues 54 00:04:31.199 --> 00:04:39.600 smart metas, sensors, probably cyber ai and the CEO what type of solutions 55 00:04:39.639 --> 00:04:43.519 are being implemented, Well, let's bring them on the show. Robert, 56 00:04:43.759 --> 00:04:46.120 Welcome to the show. Hello, nice being here, Thank you for the 57 00:04:46.160 --> 00:04:49.920 invitation. Robert. Maybe let me sort of kick off and what I'd be 58 00:04:50.079 --> 00:04:54.720 really interested to talk about is what's going on on the grid, and I'm 59 00:04:54.720 --> 00:05:00.439 particular the distribution grade and I was quite taken back to see the CEO of 60 00:05:00.480 --> 00:05:04.439 one of the Dutch distribution grid operators come out with a statement sort of saying, 61 00:05:04.480 --> 00:05:08.439 hey, listen, if you want to connect a house, a hospital, 62 00:05:08.519 --> 00:05:12.399 whatever it is in the country, we can't do it. And then 63 00:05:12.439 --> 00:05:15.720 I said, of go, how can this be in a modern society like 64 00:05:15.759 --> 00:05:18.399 the Netherlands or something like this happens. You're right, and we see this 65 00:05:18.560 --> 00:05:23.639 not just in the Netherlands. What is happening there? And in many places 66 00:05:23.839 --> 00:05:28.560 you know that the distribution grids have a certain capacity, and the capacity has 67 00:05:28.600 --> 00:05:32.360 an contractual aspect and a technical aspect. Typically, first of all, you 68 00:05:32.360 --> 00:05:39.079 have an exhaustion of contractual capacity in those places. So basically the contracts that 69 00:05:39.199 --> 00:05:45.720 exist that distribution system operator they need to guarantee that capacity for the electricity system 70 00:05:45.759 --> 00:05:47.879 to work, for to be able to not have interruptions and so on. 71 00:05:48.639 --> 00:05:54.720 And typically those capacities are not always used to one hundred percent. So that's 72 00:05:54.720 --> 00:05:59.759 the one point. Let's say you have an incredible increase of electric mobility eb 73 00:06:00.439 --> 00:06:03.279 heat pumps an other type of consumption on one side. On the other side, 74 00:06:03.279 --> 00:06:09.199 you have the generation capacity problem. There's distributed generation popping up a huge 75 00:06:09.279 --> 00:06:13.680 pipeline of projects to be connected to the grid, and this does not match 76 00:06:13.759 --> 00:06:16.920 and there's a problem in the Netherlands, but also in other places where you 77 00:06:17.040 --> 00:06:24.279 see actually that the contractual capacity is basically full. You can solve this contractual 78 00:06:24.319 --> 00:06:30.439 capacity problem with alternative connection agreements and these type of specific contracts where a customer 79 00:06:30.600 --> 00:06:36.000 gets an incentive if he does not use the overall capacity, and or the 80 00:06:36.120 --> 00:06:42.439 unused capacity can be shared among the different participants in the electricity sector for some 81 00:06:42.600 --> 00:06:46.959 time at least until this reinforcement of the grid. Is there known that things 82 00:06:46.000 --> 00:06:51.040 are possible in this way in UK, in Norway, in Austria, in 83 00:06:51.079 --> 00:06:56.480 some places, and I think some experimental parts also in the Netherlands. So 84 00:06:56.519 --> 00:06:59.399 that gives that say a little bit of room. But then there's a technical 85 00:06:59.399 --> 00:07:03.040 capacity you actually have in the grid in certain areas if you really look on 86 00:07:03.160 --> 00:07:08.800 them from an in depth, in certain lines are just really at the limit. 87 00:07:09.439 --> 00:07:13.120 And if you reached this technical capacity, and then you need to do 88 00:07:13.279 --> 00:07:16.279 many things at the same time, and you need to work on all dimensions. 89 00:07:16.319 --> 00:07:19.519 And I think that's also what in the Netherland is happening now. The 90 00:07:19.560 --> 00:07:26.279 grid operators are of course trying to solve this contractual part, but trying to 91 00:07:26.360 --> 00:07:30.040 reinforce the grids but at the same time look at flexibility, demand response, 92 00:07:30.079 --> 00:07:35.240 and many other solutions to that problem. Robert, just again, this is 93 00:07:35.279 --> 00:07:39.959 me from the outside looking in. Can you explain why this has happening now? 94 00:07:39.959 --> 00:07:42.600 Where I'm coming from? And this is we've had a grid for the 95 00:07:42.680 --> 00:07:48.680 last one hundred years and we've never had these congestion issues and then so why 96 00:07:48.759 --> 00:07:53.040 are they suddenly taking place now? And again I want to go back to 97 00:07:53.079 --> 00:07:56.720 the Netherlands. It was a lovely picture I saw about six months ago from 98 00:07:56.759 --> 00:07:59.879 the grid operator there which just showed that like two years ago, it was 99 00:08:00.240 --> 00:08:05.519 congestion and that is massive congestion. Yeah, I think there was no congestions. 100 00:08:05.560 --> 00:08:07.439 Maybe there was congestion, but not as critical as today. Yes, 101 00:08:07.480 --> 00:08:11.480 And what is happening is really what we see in certain countries like the Netherlands, 102 00:08:11.639 --> 00:08:16.839 is really this huge increase in electrification, electric cars, mobility. You 103 00:08:16.879 --> 00:08:22.199 see the increase of heat pumps and other type solutions. On the other side, 104 00:08:22.279 --> 00:08:26.120 you see this increase of renewable generation. And this happens now at the 105 00:08:26.199 --> 00:08:31.720 distribution grid level, and that's the problem here. Before in the past, 106 00:08:31.920 --> 00:08:35.919 big generation plans that were going from the transmission lines then to the distribution grid. 107 00:08:35.919 --> 00:08:39.799 So from high voltage to medium voltage and then got to low voltage and 108 00:08:39.840 --> 00:08:45.279 now what is happening really get problems in general, we see the distributions as 109 00:08:45.279 --> 00:08:50.759 an operators struggling at medium voltage level and at low voltage level. Robert, 110 00:08:50.960 --> 00:08:54.440 how do you solve this as quickly as possible, as quickly as possible that 111 00:08:54.480 --> 00:08:58.759 if you have time, you would completely reinforce the grid. And you still 112 00:08:58.759 --> 00:09:03.399 need do this. So it's a mixture of things that the grid operators need 113 00:09:03.440 --> 00:09:07.519 to do. At the same time, they need to put reinforcement in the 114 00:09:07.559 --> 00:09:13.399 grids with different additional wires, reconductoring and all of those additional things that is 115 00:09:13.440 --> 00:09:16.720 clear. At the same time, they need to shift in time the peaks. 116 00:09:18.120 --> 00:09:20.519 So that means at the end, let's say you have either storage or 117 00:09:20.919 --> 00:09:26.120 demand response flexibility, these type of solutions that helps the shift in time the 118 00:09:26.200 --> 00:09:31.200 peaks. And for all of that, you need digital technologies to really understand 119 00:09:31.720 --> 00:09:37.320 monitor, sensor in real time what is going on. Because if you look 120 00:09:37.360 --> 00:09:41.200 at a certain place in the grid, that's quite amazing. Now you see 121 00:09:41.240 --> 00:09:45.320 the power flows in some hours of the day are going in one direction and 122 00:09:45.720 --> 00:09:50.120 other hours of the same day, they go in other directions and you see 123 00:09:50.159 --> 00:09:54.600 the peaks they moving around, and that is really creating the stress. So 124 00:09:54.679 --> 00:09:56.919 what you need to do is to first of all understand in real time what 125 00:09:58.080 --> 00:10:01.480 is going on. And here now not speaking about the Netherlands only, but 126 00:10:01.639 --> 00:10:09.639 in general, the utilities are still not so well digitalized in the grids that 127 00:10:09.720 --> 00:10:16.039 they are have really complete real time visibility of the medium and low voltage grid 128 00:10:16.159 --> 00:10:20.360 in all places. And this is the first step. Of course, you 129 00:10:20.639 --> 00:10:24.559 need to do a network planning, set up flexibility markets, do at specific 130 00:10:24.639 --> 00:10:30.639 contracts, and then you're bound typically by the regulatory constraints that you have, 131 00:10:30.879 --> 00:10:33.159 so it's a mix. You need to do the right contract, do the 132 00:10:33.200 --> 00:10:41.360 right reinforcement, do the right equipment, so put digital technologies inside the power 133 00:10:41.399 --> 00:10:48.200 grids and all of that combination engaging the customers then to curtail or to engage 134 00:10:48.240 --> 00:10:52.759 the inflexibility and all of that together actually then solves the equation. It's the 135 00:10:52.799 --> 00:10:56.000 only way to gain time. To gain time, Let's say two, we 136 00:10:56.080 --> 00:11:01.799 have completely full capacity and with a refer network. Robert your CEO of a 137 00:11:01.840 --> 00:11:07.200 company called grids Perties, which probably people don't really heard about because in fact 138 00:11:07.240 --> 00:11:13.919 you're quite new. You are carved out of NL two years ago, and 139 00:11:13.120 --> 00:11:20.559 NL still owns half of your shares and the investment group CVC owns the other 140 00:11:20.639 --> 00:11:24.159 side. Now, of course you know the Italy greed inside out because you're 141 00:11:24.240 --> 00:11:28.039 part of an L. But you're also in Spain, in Brazil, India, 142 00:11:28.360 --> 00:11:35.320 US, the Nordics. So when you have this geographical diversity, which 143 00:11:35.360 --> 00:11:41.360 of those grids would you say is the most ready and which problem are the 144 00:11:41.440 --> 00:11:46.440 same? Which problem are different? So how do you analyze all those problem 145 00:11:46.519 --> 00:11:52.679 and solution on a geographical basis? There are similarities and also great differences, 146 00:11:52.720 --> 00:11:56.240 but then the solutions to the problem then at the end turn out to be 147 00:11:56.360 --> 00:11:58.320 very similar. So if you look at the different grids, first of all, 148 00:11:58.360 --> 00:12:03.639 you have the European grids that in big part in certain countries are underground. 149 00:12:03.960 --> 00:12:07.919 You look at the US grid on the other side, they are mostly 150 00:12:07.960 --> 00:12:11.600 overhead. And if you look at the customers per transformer, which is a 151 00:12:11.639 --> 00:12:16.600 really important number. For example, in Europe you might have like fifty to 152 00:12:16.679 --> 00:12:20.799 one hundred something like that. In the US have sometimes of the very end 153 00:12:20.320 --> 00:12:24.639 the last transformer from medium to low vaulted death very few three four, or 154 00:12:24.679 --> 00:12:31.080 five customers, and those are differences that make of course the grids very different. 155 00:12:31.960 --> 00:12:35.759 They have some similarity actually if you speak about those two geographies, they 156 00:12:35.759 --> 00:12:41.879 were built in both cases many many years ago, and they were built for 157 00:12:41.919 --> 00:12:46.960 this centralized generation that we said. So both in the US is in Europe 158 00:12:46.000 --> 00:12:52.159 we spoke about the Netherlands before, but also Latin America and other Asia have 159 00:12:52.399 --> 00:12:56.960 challenges today with this increased demand, and it comes from different points. It's 160 00:12:56.960 --> 00:13:01.559 the emerging countries, developing countries. It's maybe the introduction of cooling, air 161 00:13:01.639 --> 00:13:05.600 conditioning and these type of things. If we look at the US, if 162 00:13:05.639 --> 00:13:09.159 you look at Europe, we have those things. With the data centers for 163 00:13:09.600 --> 00:13:13.679 AI for example, is coming up. It's foreseen it by twenty twenty six. 164 00:13:15.080 --> 00:13:20.600 Just the data centers for AI will create probably the same demand than Germany 165 00:13:20.879 --> 00:13:24.639 as a country today. So if you look at those things, you see 166 00:13:24.639 --> 00:13:28.120 them in certain geographies, so the topic is different. And in certain geographies 167 00:13:28.159 --> 00:13:33.159 you still look at frauds, technical losses and really bring the quality of the 168 00:13:33.159 --> 00:13:37.840 supply to the same level. So there are different situations. Really, what 169 00:13:37.960 --> 00:13:43.679 is happening everywhere is that there are more and more emergency events due to climate 170 00:13:43.799 --> 00:13:48.919 changes where you create outages because the wind creates a line interruptions, trees fall 171 00:13:48.960 --> 00:13:52.720 on the lines, and at the same time you have also this change in 172 00:13:52.799 --> 00:13:58.519 demand and you want to bring the security of supply. So what we see 173 00:13:58.600 --> 00:14:03.080 really grids per tise. Looking at all those different geographies, there are commonalities 174 00:14:03.120 --> 00:14:09.480 in the solution because you always need to understand in real time what is going 175 00:14:09.519 --> 00:14:15.320 on in order to solve then the specific problems that might be minimize the interruption 176 00:14:15.440 --> 00:14:20.200 time, make sure that quality of supply is continuous, increase the hosting capacity 177 00:14:20.519 --> 00:14:26.279 and all of that and the part of the solutions then have many similarities and 178 00:14:26.320 --> 00:14:31.200 they go typically by putting sensors on the grids in the form of smart meters. 179 00:14:31.240 --> 00:14:37.720 For example, smart meters are ready now becoming almost a commodity that is 180 00:14:37.799 --> 00:14:43.679 really necessary tool for utilities worldwide to understand what is going on at the endpoint 181 00:14:43.720 --> 00:14:48.799 of the grid, and a new generation of smart meters actually give much more 182 00:14:48.840 --> 00:14:56.159 information in real time that can then be used for this real time flexibility management 183 00:14:56.200 --> 00:15:00.559 as well. On the other side, you need to control you grid. 184 00:15:01.000 --> 00:15:05.559 That means that you need to put elements inside the grid that allow you remotely 185 00:15:05.679 --> 00:15:11.559 disconnect, reconnect lines, change the topology and do this wherever possible in an 186 00:15:11.600 --> 00:15:16.080 automated way so that there's a minimum interference or no interference at all to the 187 00:15:16.159 --> 00:15:20.039 customers at the same time. And so those are the similarities that we see 188 00:15:20.080 --> 00:15:24.919 really all around the globe. That the set of solutions that are there are 189 00:15:26.039 --> 00:15:31.720 very similar in terms of technologies. They require digital technologies, telecommunication links and 190 00:15:31.840 --> 00:15:37.480 of course control and measurement technologies inside the grid, and they solve still different 191 00:15:37.679 --> 00:15:43.320 problems because of the different geographies are at different levels of maturity. Robert, 192 00:15:43.320 --> 00:15:46.879 can I ask you a little bit about your view on storage, because as 193 00:15:46.879 --> 00:15:50.080 I'm listening to you, I'm sort of thinking, surely the answer is just 194 00:15:50.120 --> 00:15:56.799 to put lots and lots of decentralized storage in there. Storage is a solution 195 00:15:56.120 --> 00:16:00.960 to a certain part of the problem because it shifts in time your peak problem. 196 00:16:02.480 --> 00:16:07.000 Everywhere where there's a problem with the peak, storage can help for sure. 197 00:16:07.039 --> 00:16:11.679 And there's a lot of activity ongoing worldwide, know in utility grade storage, 198 00:16:11.799 --> 00:16:15.039 and that is clear. And also the price of storage no is getting 199 00:16:15.080 --> 00:16:19.440 down, so it becomes more and more attractive. But it's a complementary solution 200 00:16:19.639 --> 00:16:26.399 always to the other pieces you still need to act on those storage because in 201 00:16:26.399 --> 00:16:30.399 the storage the energy that you store, this is just therefore a certain time 202 00:16:30.519 --> 00:16:34.159 So short term things can be managed through storage. But you still need to 203 00:16:34.200 --> 00:16:40.440 interconnect then the controller of the storage actually that you have in the grid with 204 00:16:40.879 --> 00:16:45.200 the actual control of the grid itself with the customer, and so you need 205 00:16:45.240 --> 00:16:48.200 to control this area of the grid. Storage is a piece of the solution. 206 00:16:48.399 --> 00:16:53.320 Flexibility in general is another one. Grid control is for sure another one 207 00:16:53.320 --> 00:17:00.519 as well. Even topology reconfiguration of the grids and doing this autumnmatically is another 208 00:17:00.679 --> 00:17:04.519 piece of the solution, and you need to do all of that in certain 209 00:17:04.559 --> 00:17:11.559 areas. Whenever you contract with a distribution company, do they have a clear 210 00:17:11.680 --> 00:17:15.960 view of their problems? Because there's a lot of solution flying and but first 211 00:17:15.960 --> 00:17:19.319 they have their own idea. The second thing is there are a lot of 212 00:17:19.400 --> 00:17:25.480 startups swarming around. I'm sure some with a great product or there is not 213 00:17:25.799 --> 00:17:30.440 that a great product. Plus you get the equipment manufacturer, the g the 214 00:17:30.480 --> 00:17:37.880 Detachi or Snideranson also pushing to their solutions. So how all this works together? 215 00:17:38.440 --> 00:17:42.880 When do you ally, when do you compete? How does it work? 216 00:17:44.799 --> 00:17:48.920 First of all, the utilities really have a big challenge today, and 217 00:17:48.960 --> 00:17:52.319 that's not just this technological challenge, but also the way they are set up, 218 00:17:52.400 --> 00:17:56.799 the way the organizations work, you know, the generational problem as well 219 00:17:57.480 --> 00:18:02.680 a problem also getting the skill sets and training in the field. So all 220 00:18:02.720 --> 00:18:07.440 of those things at the end makes very important the different parts of the solution, 221 00:18:07.480 --> 00:18:11.359 let's say, work together. So it's a lot of orchestrating the solution 222 00:18:11.559 --> 00:18:17.079 for the utilities, helping them working together with a solution. And that's what 223 00:18:17.119 --> 00:18:21.799 we see when we talk to the different utilities, they in some cases about 224 00:18:21.839 --> 00:18:26.880 really co designing, co creation. In some cases even goes to managing fully 225 00:18:26.960 --> 00:18:32.240 the technology on behalf of the utility as a service. And this is a 226 00:18:32.319 --> 00:18:34.960 new business model. Of course. Also for some utilities say okay, hey, 227 00:18:36.079 --> 00:18:40.319 certain pieces of this problem, the technological piece that is really complex, 228 00:18:40.799 --> 00:18:45.079 I outsource this and have a trusted partner that manages this for me. That 229 00:18:45.200 --> 00:18:48.519 is a new model. And this is what we see that utilities are one 230 00:18:48.519 --> 00:18:55.519 and more looking also those new models that are in contrast on this traditional mind 231 00:18:55.759 --> 00:19:02.400 of the utility that follow this highly KPEX intensive path of doing investments, investments 232 00:19:02.440 --> 00:19:06.759 that are recognized by the regulator. And this brings me to the other very 233 00:19:06.839 --> 00:19:11.200 important piece of the equation. It's actually the regulatory schemes because what is really 234 00:19:11.279 --> 00:19:18.960 also needed in order to stimulate and allow the utilities to redo this needed change. 235 00:19:18.240 --> 00:19:23.400 Is he the right regulatory framework to be able to recognize a totex model 236 00:19:23.799 --> 00:19:30.279 instead of just KPEX and these type of things output based regulation. There are 237 00:19:30.359 --> 00:19:33.079 schemes in many places around the world, but not in many many other places. 238 00:19:33.079 --> 00:19:38.039 Still it's all about investment recognition summering a little bit. There's the challenge 239 00:19:38.119 --> 00:19:42.960 about the regulatory framework that of course has put a way of working in the 240 00:19:44.079 --> 00:19:48.640 utilities in place that is looking really of doing investments in the grids in part 241 00:19:48.680 --> 00:19:52.559 where in wires and cables and transformers, which is all needed, but it's 242 00:19:52.599 --> 00:19:56.839 not the only way you need to compliment with digital technologies. Then there is 243 00:19:56.960 --> 00:20:03.960 this training upscaling of people. The internal organizations today have metering departments that you 244 00:20:04.000 --> 00:20:08.039 have with an operation department within a utility. Maybe they do not even speak 245 00:20:08.039 --> 00:20:11.920 to each other because in the past it was not necessary. Today it's becoming 246 00:20:12.000 --> 00:20:18.319 really relevant and what we see really here coming back also to the competitors today, 247 00:20:18.400 --> 00:20:21.799 we really seek now many of the competitors. In some cases they are 248 00:20:21.839 --> 00:20:25.759 really competitors, but in many other cases they are partners because we need at 249 00:20:25.759 --> 00:20:30.039 the end to solve the problem for the utility and for the sector, and 250 00:20:30.079 --> 00:20:33.599 you can only do this by working and working together. Robert, I like 251 00:20:33.640 --> 00:20:37.039 what you're talking about. And actually it's the biggest concern I have around the 252 00:20:37.160 --> 00:20:42.880 energy transition, is that what you're talking about is we need cultural change in 253 00:20:42.920 --> 00:20:48.920 the incumbents. That's what you're sort of saying, and I suppose I'm curious 254 00:20:48.960 --> 00:20:52.960 about how do we do this? Yeah, how does that happen? There's 255 00:20:52.000 --> 00:20:56.039 a generational change as well. At the same time, the people that work 256 00:20:56.039 --> 00:21:02.799 in the utilities of force are users of electron their users of digital technologies, 257 00:21:02.839 --> 00:21:07.839 and so I mean we're getting there, and they're very innovative utilities as well, 258 00:21:07.920 --> 00:21:11.720 and others follow those more innovative utilities over time. You're right, it's 259 00:21:11.759 --> 00:21:17.319 a cultural change. And what is really helpful is this type of new business 260 00:21:17.319 --> 00:21:22.519 models that you really support the utilities offering as a service. The technology as 261 00:21:22.559 --> 00:21:29.640 a service contract might have at the end a transfer of that knowledge of that 262 00:21:30.039 --> 00:21:33.960 technology and everything again back inside the utility. So the utility can for a 263 00:21:34.000 --> 00:21:40.359 certain time of this change continue to manage a big piece of the grid as 264 00:21:40.400 --> 00:21:44.839 it used to manage that part of the grid, while the new technologies are 265 00:21:44.839 --> 00:21:51.799 introduced in those areas where the problems occur and slowly revamping the grid migrating and 266 00:21:51.839 --> 00:21:56.079 at some point have also then a transition back so that it becomes part of 267 00:21:56.200 --> 00:22:00.799 the regular operation of the grids, because the grid operator at the end become 268 00:22:00.119 --> 00:22:06.359 system operators and need to have also all of those skills internally. At some 269 00:22:06.480 --> 00:22:11.640 point, Robert, just explain what you mean by this area of us as 270 00:22:11.720 --> 00:22:15.960 servers. What I mean here is the technology. If you equip a digital 271 00:22:17.079 --> 00:22:22.519 grid with digital technologies, that means you install edge computing, you install RTUs. 272 00:22:22.640 --> 00:22:26.880 Let's say it's control units inside the grid. Know that control monitor sensor 273 00:22:27.000 --> 00:22:33.240 your grid. You install smart meters. There's a lot about new IT systems 274 00:22:33.559 --> 00:22:37.119 would integrate with the OT systems, so you have much more information. We 275 00:22:37.200 --> 00:22:42.200 speak here about everything related to the data and together with those edge computing. 276 00:22:42.279 --> 00:22:48.440 So all of those technologies are complex because they go together with the right communication 277 00:22:48.680 --> 00:22:55.279 links with small latency, the right band with a really challenging problem to solve 278 00:22:55.359 --> 00:22:59.839 and it requires a high level of skill sets, and as a service means 279 00:23:00.279 --> 00:23:04.200 that a company like ours but also others offer to the utility saying Okay, 280 00:23:04.240 --> 00:23:08.279 don't worry about the complexity. We take care of that complexity for you. 281 00:23:08.359 --> 00:23:15.480 We manage that technology for you with a service level agreements, and then there 282 00:23:15.559 --> 00:23:18.880 might be a transfer and to the utility at a certain time for example. 283 00:23:19.000 --> 00:23:23.079 And this as a service means that it's a solution that allows them to not 284 00:23:23.960 --> 00:23:30.119 be too much concerned about this cultural change in such a short time. They 285 00:23:30.160 --> 00:23:33.799 can do this over a little bit more time, and they have as a 286 00:23:33.839 --> 00:23:40.920 company a partner that helps take care of this technological complexity. So how about 287 00:23:40.960 --> 00:23:44.680 you talk about you iiting more digital and what we see in the press, 288 00:23:44.680 --> 00:23:47.920 and you're going to tell me if it's for real or if it's just scare 289 00:23:48.000 --> 00:23:52.920 mongoring. Is cyber attacks? Cyber attacks not great? So is it for 290 00:23:52.000 --> 00:23:56.799 real? How do you protect yourself? Or is it just generally is trying 291 00:23:56.839 --> 00:24:03.039 to get more clicks? Don't know? It's a cybersecurity is really a design 292 00:24:03.160 --> 00:24:08.920 criteria today of the grids of the digital technologies, and it's really important and 293 00:24:10.039 --> 00:24:14.920 for all this real time control that I mentioned before sensors and everything that you 294 00:24:14.960 --> 00:24:18.440 need to do, you need to be protected from cyber attacks. So today 295 00:24:18.599 --> 00:24:26.759 I'm not aware of all the modern technologies that are being used are already designed 296 00:24:26.960 --> 00:24:33.200 to be secure before cybersecurity. What really helps is this distributed way of doing 297 00:24:33.279 --> 00:24:38.599 things. For example, do is we have edge computing devices that go really 298 00:24:38.720 --> 00:24:45.079 down at the local level within the distribution system, operation and control then a 299 00:24:45.119 --> 00:24:49.319 local area, and this local area makes the grid actually more resilient. What 300 00:24:49.480 --> 00:24:55.480 still needs to be protected. You're absolutely right, are all the OT systems, 301 00:24:55.599 --> 00:25:00.000 all everything that also in the past of a big concern for the utility, 302 00:25:00.319 --> 00:25:04.279 But I really see the level of protection at the utility levels is really 303 00:25:04.319 --> 00:25:10.799 increasing, so they are more not only aware of cybersecurity, they are getting 304 00:25:10.839 --> 00:25:15.039 protected there. And this is also some area where we as a technology company, 305 00:25:15.039 --> 00:25:18.559 for example, help the utilities. Robert, maybe just let me ask 306 00:25:18.599 --> 00:25:22.319 one more question, which is if you look at the future here, talk 307 00:25:22.359 --> 00:25:26.720 a little bit about how you see the great management and also what we didn't 308 00:25:26.759 --> 00:25:32.519 mention was at all in the conversation was transmission. So distribution versus transmission. 309 00:25:32.519 --> 00:25:34.160 Talk about that and how you see this. You know, over the next 310 00:25:34.160 --> 00:25:40.279 few years developing well. First of all, I think the focus really will 311 00:25:40.279 --> 00:25:45.400 now get more and more on the distribution network and the transmission network remain, 312 00:25:45.480 --> 00:25:49.680 that is clear, but the topics we discussed before flexibility of those capacity local 313 00:25:49.680 --> 00:25:55.000 capacity problems become things on the distribution network. So that's first of all, 314 00:25:55.039 --> 00:25:57.359 that is very clear. And this is also where the focus needs to be 315 00:25:57.400 --> 00:26:03.839 at the same time. That is, COB networks traditionally are less digitalized as 316 00:26:03.880 --> 00:26:07.720 well less control, and this is where really what I see in the future 317 00:26:07.799 --> 00:26:11.240 what will happen. And the nice thing is that you can today you have 318 00:26:11.279 --> 00:26:17.960 the technologies available that you can put into the grids that also allow for updates 319 00:26:18.000 --> 00:26:21.279 in the future. So it's not that you put a technology today in the 320 00:26:21.319 --> 00:26:26.480 place that solved just today's problem, but they actually help you solve the future 321 00:26:26.519 --> 00:26:32.960 problems buy and that is the interesting thing software updates, and so that is 322 00:26:32.960 --> 00:26:37.799 when we ask about the future. Here we have the combination of hardware and 323 00:26:37.960 --> 00:26:44.799 software solutions that equip and make a digital grid that are needed in combination and 324 00:26:44.839 --> 00:26:48.640 that will change over time to make this grid and maintain that this grid is 325 00:26:48.680 --> 00:26:53.000 really flexible enough for the current challenges, but also the increased future challenges, 326 00:26:53.319 --> 00:27:00.000 making use of batteries, making use of customer side resources at the same time 327 00:27:00.279 --> 00:27:03.839 looking at really the grid management and doing the best management of losses and all 328 00:27:03.880 --> 00:27:08.279 of the other technical aspects of a power grid. Well, Robert, thank 329 00:27:08.319 --> 00:27:15.319 you very much for this conversation. I probably have a one hundred more questions, 330 00:27:15.359 --> 00:27:18.720 but what I can see is that there are some intelligent people like you 331 00:27:18.880 --> 00:27:25.519 who are taking care of permanently modernizing the grid, and that's what needed for 332 00:27:26.119 --> 00:27:30.400 a successful energy transition. Chard. Thank you very much, Robert. I 333 00:27:30.480 --> 00:27:33.559 really enjoyed the conversation. I've learned a lot. Yeah, thank you, 334 00:27:33.599 --> 00:27:38.160 thank you both the pleasure well, Jarred. As usual, the most critical 335 00:27:38.720 --> 00:27:44.960 part of the value chain in the ergy transition are also the one which are 336 00:27:45.000 --> 00:27:49.000 the most difficult to get enthusiastic about. It's a tough one to get enthusiastic 337 00:27:49.039 --> 00:28:00.319 about distribution grids. They are nevertheless, nevertheless, they're critical. Yeah, 338 00:28:00.400 --> 00:28:03.200 nobody likes the wires or the substation, so I agree with you on that. 339 00:28:03.480 --> 00:28:07.079 Absolutely we need them, but we we just take them for granted and 340 00:28:07.119 --> 00:28:10.920 ignore them. And by the way, politicians don't win votes by saying we're 341 00:28:10.960 --> 00:28:15.079 going to upgrade the distribution grid doesn't happen. Yeah, but if there's all 342 00:28:15.119 --> 00:28:18.119 in blackout all of a sudden, the politicians and start waking up. And 343 00:28:18.519 --> 00:28:23.200 these are long term play because they always have a margin, and at the 344 00:28:23.240 --> 00:28:27.200 beginning they eat into their margin, and when there is no margin, boom, 345 00:28:27.279 --> 00:28:33.759 something happens. But it's going to take years to reconstitute the margin. 346 00:28:33.519 --> 00:28:37.880 So it's a tough one. It's a tough one. Yeah, it is 347 00:28:37.920 --> 00:28:41.720 a tough one. The reflection that I had was that I think we need 348 00:28:41.759 --> 00:28:47.039 to have radical regulatory change. And the reason I say that is because most 349 00:28:47.319 --> 00:28:52.440 grid operators are incentivized just to build a grid, and we need to incentivize 350 00:28:52.440 --> 00:28:56.039 them to make sure that the grid is much more efficient and effective, and 351 00:28:56.079 --> 00:29:03.279 that requires different intentions reflection I had on this and I'm not saying we know 352 00:29:03.319 --> 00:29:06.599 how to know how to do that, but as I said, I don't 353 00:29:06.640 --> 00:29:11.039 think the current regulator environment across most of the western world is really conducive to 354 00:29:11.039 --> 00:29:14.000 doing this. And I think of it, if I look at my local 355 00:29:14.319 --> 00:29:18.440 grid operator, it's a small grid operator. How are they going to digitalize 356 00:29:18.440 --> 00:29:21.279 the grid? How can they? They don't have the capabilities in their house 357 00:29:21.319 --> 00:29:25.119 Okay, maybe they're outsourcer to a grid expertise or something like that, but 358 00:29:25.200 --> 00:29:27.200 if you don't have the capabilities in house, you can't even acquire those service 359 00:29:27.240 --> 00:29:32.039 Dodge understand what I mean this is it's that, and then it's the lack 360 00:29:32.079 --> 00:29:34.599 of expertise, and then it's still as I said, the incentive structures I 361 00:29:34.640 --> 00:29:37.759 think need to change. But I think that that's the way it is going 362 00:29:37.799 --> 00:29:44.599 to go going forward. You're going to have to outsource this whole digitalization element 363 00:29:45.039 --> 00:29:48.440 to a third party because you just can't do it yourself. Simple as that. 364 00:29:48.279 --> 00:29:52.839 And I asked one of the digit distribution grid operators what the capacity utilization 365 00:29:53.240 --> 00:29:57.680 is in the distribution grid at any time? Guess what what the number was? 366 00:30:00.519 --> 00:30:03.039 We know a little bit or that twenty five Okay, yeah, well 367 00:30:03.039 --> 00:30:08.880 probably not in the Netherlands, probably not of the letter there's probably ninety percent 368 00:30:08.920 --> 00:30:11.160 there, yeah yeah, but in the West and words twenty five, So 369 00:30:11.160 --> 00:30:15.400 we know otherwise we overbuild a grid. Yeah, and that's okay that we 370 00:30:15.440 --> 00:30:18.640 overbuild the grid, but that's not a very efficient way. So say, 371 00:30:18.640 --> 00:30:21.839 well, okay, well how can we better use that seventy five percent? 372 00:30:21.960 --> 00:30:25.960 And we need to think in things in a completely different way than we've done 373 00:30:26.000 --> 00:30:29.240 in the past. I think this is really critical if we're going to go 374 00:30:29.279 --> 00:30:33.240 through this energy transition in a cost effective way. Well, look, you 375 00:30:33.279 --> 00:30:37.000 can't build data center west of London. You can't have a new housing development 376 00:30:37.039 --> 00:30:41.759 in the west of London because the local grids is the weak. So there 377 00:30:41.799 --> 00:30:47.519 is no one side fitrole every place. The grid has to be many to 378 00:30:47.759 --> 00:30:51.680 much in a much more granular way. But maybe a lot of the solution 379 00:30:51.799 --> 00:30:56.680 are the same sense of digital, smart metals and so on, so we 380 00:30:56.759 --> 00:31:03.759 know the direction of travel, except that those investments are not sexy enough for 381 00:31:03.440 --> 00:31:07.319 politicians who want to cut ribbonds, and here there's no ribbonds to cut, 382 00:31:07.319 --> 00:31:11.640 so we're going to tag along with those problems. I agree with Shanda. 383 00:31:12.839 --> 00:31:18.839 Well, we thank Robert for coming and to be continued, we thank a 384 00:31:18.960 --> 00:31:23.799 Mundi for supporting our show. Thank you very much, guys, great having 385 00:31:23.799 --> 00:31:33.319 you on board and I'll talk to you next week look forward. Thank you 386 00:31:33.400 --> 00:31:37.680 for listening to Redefining Energy. Don't forget to read the show and subscribe on 387 00:31:37.839 --> 00:31:44.400 Apple, Podcast, Spotify or the platform of your choice.