Enlit Europe 2023 - Opening keynote by Frédéric Godemel | Schneider Electric

Thanks. Welcome. Pleasure to be here after last year. Interesting to be in Paris, interesting to be in the city. Well, lots of things are happening and very happy to complement what was explained on the challenges that we have today around grids.

So one thing that is basically not to comment anymore, where I think there is a consensus, is that the energy transition will come with more usage of electricity. That's a fact. And there has been in the last ten years an incredible focus on generation of renewables. That focus has been, basically, but we are all convinced now it's time to speak about demand side and to speak about grids, because there will be no energy transition if those renewables are not able to flow and self properly.

The demand side — there needs to be for all of us a sense of urgency that will be around those days. Some comments and some events and days ahead. We're very pleased to have the International Agency of Energy with us in this event so that they can as well comment with reliable data on what's going on. What's going on is obviously an acceleration of investment in renewable generation, probably not enough. So still need to accelerate.

Now, we need to all be convinced that if we just do that — if we just invest in renewable generation — we will not meet the energy transition and we will not give the answer to the energy transition. And we start to see problems appearing. Problem number one: how do we look at the demand side? Marion, you explained it very well. There is a lot to do at the demand side — first in terms of sobriety, second in terms of being much more surgical in the way we analyze the demand, sequencing. The more electricity is needed, the more grid we will need to flow centralized generation, including renewables, and to connect better the customer of the grid.

So that's basically what my presentation will be about — what are the main challenges. And I think they have been well stated. First challenge for grid or utility today is, of course, the output and the efficiency. So the output, because there will be more need for electricity. That will substitute progressively fossil fuel. The point is on 1.5 to 2 times more electricity in the period of ten years. Second thing: of course, we need to do that with a higher degree of efficiency. And we know that on the network today we have an accessible pool of efficiency, which is the losses of distribution.

The second thing, of course, is connecting more and more renewables. My first slide was stating that there is already waiting renewable capacities that are not connected to the grid. Everybody is saying we will invest two times more in renewables. So basically we will have to connect renewable centralized generation and something that is new and we start to see at scale in Europe — decentralized generation. So renewables at the demand side, which is a complete transformation on the Western network.

Last but not least — and it's very clear in the way multiannual plans and targets — utilities want to be a role model in sustainability. It's not just about delivering electricity, but doing it in a more sustainable manner. And there is plenty of touch points that can be done on the network so that this network and utilities are basically showing the way in terms of sustainability.

There is a set of challenges as well that make the job of grid and utilities pretty complex. First challenge that we all face in our office, and especially in Europe, is we start to see shortage of workforce around electricity. Let's face it — ten years ago, being in electricity was not that fancy, right? It was not the most fancy place where you wanted to work. We believe today that in the future it's a carrier. The place where new engineers, new commercial people have to develop, because you have a lot of potential associated with digital technologies and technologies that allow a more sustainable future, which is extremely appealing for a new generation. Now, what we have difficulty with is training the people and being sure they come well-trained into the system of the grid, that we have to manage the sequencing.

Is the regulation interesting? We see the regulation changing. Probably we could challenge the speed at which it is changing, but it is changing in the right direction, with much more integration of the entire chain of energy between generation to the demand side. And it's an important point.

Last but not least, the challenge has been mentioned, and I think many of you have a similar experience — this challenge we have seen over the last three years: supply chain tensions that are easing as we speak. But we have to acknowledge, especially in Europe, that we have to reinvest in some critical technologies that are not today at the scale needed for supporting the entire transition.

So where the solution could be — what could be the solution to any of those points? My main message here is to say, of course there will need to be investment in hardware, but there is a huge factor of speed and efficiency. If all the investment we are doing is linked with a clear digital roadmap, because for utilities of the future, data will be at the center of the way each and every investment will be done. The grid of tomorrow will be as much driven by hardware as by data.

And what I'm going to show you in a set of examples is that if you build a clear strategy on data, you are able to improve your output, improve your efficiency, manage better connection to renewables that by design are intermittent — and this will not change in the foreseeable future — and of course reducing environmental impact. Even calculate real-time environmental impact, which today is not what is asked. But we can probably estimate that in ten years, the carbon footprint of each and every company will be something that will be followed like financial performance ten years from now.

So a few examples to illustrate my point. First, let's look at operational efficiency. I'm not going to comment all the examples we have here, but we see a set of examples that go along: faster restoration, especially when you have a climate event or a key sequencing — of course the capacity to connect faster and manage faster the fleet of renewables like wind farms, solar farms. Loss reduction, which is not something new, but using the data and using the right collection of data in the right context, we estimate we can even improve the loss reduction in an experienced utility. And last but not least, we are looking to the future at substations that could be completely virtual and that would be much easier to engineer and to program and to adapt to the case on which they will be implemented.

So usage of digital technology — moving from SCADA, which is of course very important when you manage millions of points for a distribution utility, into collecting the right data, analyzing the data, and bringing efficiencies based on those data.

I'm going to go to my second point, which is extremely important and generates a lot of discussions in many parts of the world — is now coming to Europe as well — which is what we call distributed energy management systems. Managing points — many, many points — what we call post-human prosumers: sites that are producing and consuming and that basically are permanently willing to exchange their energy with the grid. Of course, in parallel of that, you still have to connect a lot of new renewable farms, and you can do that by basically redesigning all your connection and control systems of those farms so that you accelerate the lead time of connecting those wind farms.

I want as well to touch the topic of being exemplar in sustainability — changing, of course, devices of the network, which will be another shock to your journey for utility. But to be able to reduce SF6 emissions, of course, using data to better manage the maintenance plan. What we estimate, and we start to have a set of data points, is that utilities who are basing their maintenance on data — others are saving a lot on planned maintenance and they reduce that drastically. So we move into a domain where data are used to direct the teams to where they need to be directed.

And I could go again on one more example, because of course each time we have losses on the network, if the generation is not completely renewable, we have additional emissions. Of course, we can reduce losses of the network based on implementation of digital.

So I hope you're convinced that moving to digital, in parallel of hardware investment, is absolutely fundamental to prepare grid and customers for the future in which we enter. Two points that I want to touch in addition: with digital, you can simulate — simulation of network and demand will become a key topic. And of course connecting more demand-side customers, the famous prosumers that we will have in the future — that's only possible with digital. So I hope I convinced you that there is a path towards more sustainability, towards more output to the grid, towards the reinforcement of the grid. This path is really a mix of hardware investment and digital investment. Thank you very much for your attention.