Z sur 7 - L'invité du Trends Talk, Bernard Gustin, CEO d'ELIA Group

🎥 Mar 30, 2025 📺 Trends Podcasts ⏱ 33m 👁 38 views

Olivier Mouton accueille Bernard Gustin, le CEO d’Elia Group dans cet épisode du Trends Talk. Le groupe s’impose comme un acteur majeur de la transition énergétique en Belgique, en tant que gestionnaire du réseau de transport électrique à haute tension. Ensemble ils réfléchissent l'avenir énergétique belge selon Elia Group. Bonne écoute ! Les podcasts de cette chaîne sont désormais disponibles sur Trends-Tendances (https://open.spotify.com/show/1MdXiov...) et Trends Bourse (https://open.spotify.com/show/4LDvZDd...) . -＞ Vous pouvez maintenant écouter Le Trends des Marchés sur Trends B...

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About Bernard Gustin

Bernard Gustin, who became CEO of Elia Group on January 15, 2025, said the company has an investment plan of 30 billion euros over five years, with roughly 10 billion allocated to Belgium and 20 billion to Germany. He stated that this is one of the largest capital increases ever on the Brussels stock exchange, describing it as a sign of the economy's health. Gustin argued for electrification and infrastructure investment to reduce dependence on fossil fuel volatility, adding that while overall energy consumption may decrease, electricity demand will need to double to fill the gap. He noted that the company is also pursuing alternatives to its main plan, which involve different risks related to permits and regulatory regimes. Gustin previously served as CEO of Brussels Airlines. In that role, he highlighted the airline's decision to continue flying to countries affected by Ebola, stating they knew it was the right thing to do and that they were part of the solution. He also criticized the low-cost airline industry, saying it killed the dream of the industry and that passengers were tired of being treated as cattle, arguing for a return to a focus on service.

Source: AI-verified profile updated from Bernard Gustin's recent appearances. Browse all interviews →

Transcript (19 segments)

Narrator0:00

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Olivier Mouton0:13

Investchallenge.be. Hello and welcome to Z/7. We are Sunday, March 30, and here is a new episode with the guest of Trendstock. Today, Olivier Mouton welcomes Bernard Gustin, the CEO of Elia Group. He took office on January 15, 2025, succeeding Chris Peeters. The group is a major player in the energy transition in Belgium as the manager of the high-voltage electricity transmission network. I think what needs to be done is to electrify, invest in infrastructure to no longer be dependent on the volatility of fossil fuels at a time when the climate issue is central. Electrifying society massively seems more than ever paramount. This will necessarily require a lot of investments, and the group is at the heart of this process, as Bernard Gustin explains. The guest of Trendstalk, a leading personality, confides in depth about what has made his news.

Bernard Gustin1:20

But you are right, electrification is at the heart of our challenges. So just to give an idea, Elia has made a blueprint for Belgium to see what the energy needs will be by 2050. The first good news is that we will consume less energy in the future, by 2050, about 25% less compared to today. But on the other hand, that means much more electricity, because it will replace fossil fuels. And that is good news for two things. First, from an environmental point of view, since when we use renewable or nuclear energy, we are decarbonized, and we know the climate problem you just mentioned. But besides that, there is a new trend that is becoming more and more important: our energy independence and geopolitical considerations. Do we want to continue to be dependent on fossil fuels, oil and gas, whose price volatility is very high? The crisis in Ukraine has shown that energy is also a weapon. If I take an electricity bill, remember in 2022 when prices skyrocketed, in an electricity bill about 60% is linked to supply, mainly influenced by the evolution of gas and oil prices. About 10% is transport. So when prices spike, 60% of your bill increases. I think what we need to do is electrify, invest in infrastructure, invest, and no doubt increase this transport part, but which in the future, once the investments are made, will be much more stable, to no longer be dependent on the volatility of fossil fuels.

Olivier Mouton3:11

Bernard Gustin, you have been there for about a hundred days, you are not yet at your 100 days, you took office on January 15, I'm not mistaken. You were already there since you were chairman of the board for seven and a half years. So you know the house well, it's not like you're discovering things. But despite that, in this period there are important decisions that need to be made. The first is that there is an investment plan that is massive for Elia, we are talking about more than 30 billion by 2030 if I'm not mistaken. Is that already a big challenge for you?

Bernard Gustin3:49

It is a big challenge. We are fortunate to be in two countries, Belgium and Germany, that have clearly decided to make an energy transition. This energy transition, as I just explained, is important for ecological factors but also strategic factors, and also to avoid our energy bill varying too much in the future due to oil and gas prices, with access to two seas, which is very important. So today, to achieve this state, we need to invest in our infrastructure. We have an investment plan that has been decided by both governments and that we must implement, which is 30 billion over the next five years. That means about 10 billion in Belgium and 20 billion in Germany. It is logical that the investment plan is larger in Germany because first, there is a very clear will to move forward on the energy transition, and there will be no more nuclear in Germany. Second, it is a larger territory. And if I try to use simple images, in Germany you have industry in the south, the sea in the north, and we need to connect and transport energy from the north to the south. In Belgium, we need to transport it from the North Sea to the country, but also across borders. That is the role of Elia. Elia's role is to transport electricity across borders, from the sea to industry, and to ensure that there is electricity. Interconnection will be more important than ever. Yes, and we need electricity today, tomorrow, and the day after. If we want to have it the day after, we need to start investing today. That also means, when we talk about this, we are talking about a massive electrification. There is industry, the needs of individuals will explode with electric cars, heat pumps, etc. That means that clearly our network today cannot support all that. So that is the major challenge of what we are doing.

Olivier Mouton6:39

Speaking of investment, we need to find the money. If I'm not mistaken, among the projects at the start of your term, there is that of going in search of these amounts. You announced a first fundraising of 850 million two weeks ago, I think, from first-class private investors. You said you were quite happy, you talked about the Champions League. What does that mean? Does it mean that Elia is moving to another dimension?

Bernard Gustin7:09

As you know, Elia's stock price suffered a bit at the beginning of the year, so it was very important that we could show the market that we were capable of financing these very important investments. To finance these 30 billion euros, there is a debt part, but there was also a part of capital raising from shareholders. We need to raise 4.4 billion euros over the period between now and 2028, and we needed to raise 2.2 billion euros in the short term. That's fine, but we need investors who have confidence in us. We did it in a somewhat original way: first we had a private placement before going to the market. We had a private placement with four investors. Let me explain who they are. First, our reference shareholder, the Publité group, which is a Belgian municipal holding representing local authorities. It is very important that they are there because it gives confidence to other investors, a stable shareholder, a Belgian anchor. Publité is transforming itself; in the past they have always supported us, but one might wonder if the Belgian municipalities had the vocation to continue supporting us alone. Publité decided to strengthen itself by bringing in Fluxys and the SFPI, the Belgian sovereign fund. So that ensures the Belgian anchor. Besides that, we have three first-class investors who are globally recognized: BlackRock, an American investor; CPPIB, Canadians; and Atlas from Future Fund, Australians. They are very important in the investment market, have great experience in infrastructure, and decided to invest at the price of the stock on the day we launched the operation. That is very important because it shows they have confidence in the strategy; they didn't ask for a discount. They gave a clear signal that despite the stock price suffering, the fundamentals are strong and they believe in the strategy.

Now, today we are launching the capital increase that follows for 1.3 billion euros, and they have also committed to subscribe to this capital increase. That means that of the 2.2 billion we need to find, 55% is already guaranteed. So now we are launching this second operation with a price that corresponds roughly to the price paid by the private placement investors when we announced it on March 7, with a clear cap. We have the certainty that we have set the fundamentals so that we do not have to return to the market in the near future, which is also important because otherwise investors would think, why buy Elia shares now if they will ask for more and dilute me in a few months or years. Here we have a plan that allows us to finance ourselves. We have seen that the market reacted positively because it understood that message, that the fundamentals of Elia are strong and that we will not have to return to the market anytime soon, and that we have a plan to finance the entire planned period.

Olivier Mouton11:16

Concretely for our viewers, what does that mean?

Bernard Gustin11:19

It means that we are going to build large networks everywhere in Belgium. For the case of Belgium, there are already projects that have been talked about for some time. It's not going to be accelerated, it's going to be realized. The main projects are a general reinforcement of the network, and two major projects: Ventilus and Boucle du Hainaut, which are very important for bringing renewable energy from the sea to the interior of the country. Also, you know, in the north, there is a real strategy for data centers with the arrival of Google, which are groups that demand enormous amounts of energy. So these two investments, for which we must be careful to take into account all interests, are nevertheless essential. I say this because often we talk about the NIMBY phenomenon. There are legitimate concerns, but we must also ask ourselves what we want in terms of energy transition. We must ensure that in 5, 10 years, there is the necessary energy. I don't want groups to leave Belgium because they cannot be connected. We have seen the case in the Netherlands where investments were not sufficiently made in the past, and today in some regions, industries want to establish themselves but cannot because they cannot be connected. In Belgium, the situation can quickly become tense. That means permits will have to be accelerated, but it also takes time to build. Even if we accelerate permits, we need to build and plan. There is also tension in the supplier market, so we cannot easily find materials. So we need to plan well. These two projects must be realized because they are important for bringing renewables from the sea to the interior and for allowing the development of activities like that of Google. There is also the famous Princess Elisabeth Island. Naturally, the part that has been decided is the island and the alternating current component, which will connect the first offshore wind farms to the country. That is also important for the energy transition.

Olivier Mouton13:52

But one of your decisions when you arrived was to put the project on hold. You mentioned the stock price suffered, and there was the cost overrun of this island, which was widely praised when announced, and then the price went from 3.5 to 7 billion, if I'm not mistaken. So that means that it was one of your decisions, along with the Belgian CEO, to get it back on track, right?

Bernard Gustin14:27

Yes, I think it was important, and we took our responsibilities. It would have been easy to say that we need to continue because it was decided by the government, but I think it was not reasonable. We do not have the power to decide; the government decides, but we made a recommendation. When we looked at it, there were three topics. First, we are talking about the direct current component; the island will still happen with the alternating current component, and budgets are under control. The cost increases were on the direct current part, which is technologically a first. That means we are in a more unknown world in terms of budget evolution. The three reasons we recommended putting the project on pause: first, we saw that supplier prices were increasing by 4 billion euros, which will not happen because we paused. Two billion of that was due to supplier price increases. There are only three suppliers in the world capable of this, and the market was extremely tight. Second, at that time we had a caretaker government, and it was not reasonable to make such a partnership decision without a full government. Now we have a government, and Minister Billet is working on it. Third, we had alternatives. They are not perfect, but they allow developing the same energy capacity for Belgium at a lower cost, with some risks in terms of permits and regulatory regime. If they were perfect, we would have chosen them immediately. This allows us to refine them and put them in competition with the main plan. That is why we decided to take our time, and we saw immediately that it relieved the system.

Olivier Mouton17:57

Given the enormous project you have ahead, the context of international competition for supplies, the geopolitical situation with tariff barriers, does that mean you will have to adjust constantly?

Bernard Gustin18:01

It is clear that we are in a world where Elia is not the only one carrying out such projects, and Belgium and Germany are not the only ones. You have heard of other TSOs, like TenneT in the Netherlands and Germany, which announces a 200 billion investment plan over 10 years. So we need to be proactive and coordinate. When I was a young consultant a few years ago working for the transmission grid, the investment rate for Elia was below 1 billion. In 2024, we invested almost 5 billion. The plan has already started; we recruited nearly 800 people last year. So it is a real challenge. Money is a challenge, but the human resources aspect is a real challenge. At Elia, you see a whole population of young engineers and technicians joining. We are one of the most important employers in Belgium in terms of growth: 770 people last year in Belgium and Germany, and this year will be the same. Regarding suppliers, we talked about the Princess Elisabeth Island, but the good news is that almost 60% of our orders are secured for the investment plan, including cables and converters. You see me quite relieved with the capital increase today, but we had to move fast because others will come behind and make the same demands to the same investors. When I talked about the Champions League of investors, we are happy to have them. It doesn't mean they won't go to others, but at least we secured them. The danger was that we would be too late, and they would say they already invested elsewhere. So we need to be intelligent in timing, proactive and fast, but not minimize the financial, human, and supplier challenges.

Olivier Mouton20:20

Bernard Gustin, you are also the CEO of Elia Group, not just the Belgian branch. That means you have a private dimension and an international dimension. What does that mean? It means you have an agility that allows you to engage in consulting operations abroad, to have a dynamic that is important. We often talk about Elia in Belgium, but there is Elia Group, an international energy group specialized in electricity transmission. So that means we have the activity in Germany, which is larger than the activity in Belgium, about 60% of our business. Strategically, it is important to have both, because they are extremely well located near the Baltic and North Seas, where renewable energy will come from. I have a career in transport, and one thing I learned is that you never beat geography. We are extremely well placed. This has allowed us to have significant growth, and when one country has less growth, we can compensate. That is why we need to develop internationally, because one day growth in Belgium will plateau, and we need other geographies. It is also important to manage multiple regulators to avoid being in the hands of one. Technologically, we are in two growing markets with strong offshore competence in Germany and interconnection competence in Belgium. Combining them gives us interconnected offshore networks that we are almost the only ones to operate. The objective is to exploit this knowledge internationally without necessarily needing CAPEX, by selling our know-how. That is what we are doing in the United States, very prudently. There is a real need for offshore, though put aside with the Trump administration, but it will come back. Our small Belgium with 67 km of coastline has more offshore capacity than the entire East Coast of the US. But most of our projects are onshore, direct current transmission to supply cities like New York and Chicago. There is a real need, and we can bring our expertise with local partners. We identify, develop, and build the asset, then sell it, but we hope to continue operating it because our strength is operational and technical. So there is a Belgian anchor for strategic autonomy, but also a global will necessary for long-term growth. We have a consulting company, Elia Grid International, which is present worldwide and has a unique technical competence. It sells its services globally and helps us understand other markets. This ecosystem aims to make Elia a great Belgian international group. We have a tradition in energy, and the core of the energy value chain today is the networks because of the flexibility of renewable production. The network has become the heart of the value chain, and we own our networks in Belgium and Germany, giving us a unique know-how to develop internationally.

Bernard Gustin, you are also a strategist, often talked about. You have been in transport, you helped save Brussels Airlines, and you also revived Lineas. What is your driving force in all this?

Bernard Gustin26:58

I often take the anecdote of Brussels Airlines. I had the chance to make the initial business plan, which will celebrate 25 years next year. In 2002, the difference between optimists and pessimists was that optimists thought we would fly for six months, pessimists said it would never work. I am very proud that with the teams we managed to get the company off the ground. It was a real challenge, and we passed difficult times, like the terrorist attacks and COVID. But it is there, and I am happy to see good results. It is about impact, Belgian anchor. Take Lineas, much smaller but extremely strategic. If Lineas disappeared tomorrow, our ports would be blocked, the petrochemical cluster in Antwerp could not export. Besides the environmental aspect, a train uses six times less energy and CO2 than a truck. We have an asset in Belgium, and we cannot let it go. We need a strong industrial fabric with a Belgian anchor so that decisions are made in Belgium. That is what I hope to contribute with Elia. What drives me is impact. Another thing is working with great people, the team aspect. I am a sportsman, I like team sports. The success of the financing was a human experience in team building. There is nothing better. It is a mix of vision and tenacity. When you are up against the wall, you have no choice but to find a solution. The message was clear: we had to do it. I think it's about surrounding yourself with quality people. I have worked with the same colleagues across companies. The recipe is to have people with the same mindset, and together we can do it. I often use the phrase: 'Everyone knew it was impossible, but we didn't know, so we did it.' We could write a book about the adventures of this project, because it's not every day you raise 2.2 billion on the Brussels Stock Exchange. Some people say it's a lot of money, but I think it's great news for the Belgian economy. And as in football, all together, all together.

Olivier Mouton32:18

You have understood: the CEO of Elia Group is betting on electrification to succeed in the energy transition. Despite a 25% drop in energy consumption by 2025, electricity demand will increase strongly to replace fossil fuels. This is positive for the environment and an opportunity to strengthen our energy independence. Massive investments will be needed to modernize electricity infrastructure in Belgium and Germany, with a 30 billion euro plan over 5 years. This concludes this episode. Thank you for spending part of your Sunday with Z/7. Tomorrow I will have the pleasure of seeing you again for a new episode with news not to miss. We will discuss the investments needed to finance Belgian defense with Marc de Vos. Good Sunday and see you tomorrow on Z/7.

Warren Buffett33:15

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