Here are some ways to reduce carbon emissions with sustainable energy
Adopting energy-efficient strategies that reduce the demand and greening the current energy supply is key.
Pierre Cheyron, Managing Director – Africa, Middle East and Asia at ENGIE Energy Solutions
A seasoned business leader in the energy industry, Pierre Cheyron currently serves as the managing director at ENGIE Energy Solutions for Africa, Middle East and Asia region.
In his role, he oversees the P&L of Energy Solutions activities in the region, managing an installed capacity of over 4.6GW and leading a team of 5,000 staff across eight countries.
Previously, Cheyron was the chief business development and strategy officer of ENGIE Energy Solutions. He was until July 2020 the CEO of ENGIE South East Asia, leading one of the fastest growing key business clusters in the Asia Pacific organisation.
Cheyron joined Engie in 2011 as CEO of Cofely South East Asia, and then overseeing the P&L of all the services activities of the company in Asia Pacific from 2015 to 2018. He is now a board member of ENGIE Germany, Tabreed, ENGIE Spain, ENGIE Portugal and of CCI France International.
In an exclusive interview with Gulf Business, Cheyron explains the role of technology in creating sustainable energy solutions and the challenges business face in adoption of such solutions.
What are some of the sustainable energy solutions that can be implemented to reduce carbon emissions and promote renewable energy sources?
Adopting energy-efficient strategies that reduce the demand and greening the current energy supply is key. On the demand side for example, retrofitting buildings generates efficiencies by optimising energy use in air conditioning, ventilation and other mechanical and electrical systems.
HVAC systems, for instance, can be a crucial contributor to energy savings; heating and cooling easily account for 40 to 60 per cent of a commercial building’s total energy costs.
Retrofits are not only associated to buildings but can also be aligned with city wide initiatives, for example street lighting can represent up to 40 per cent of the electricity bills at a municipal level and accounts for 15 per cent of global power consumption and 5 per cent of greenhouse emissions.
Retrofitting traditional streetlights with smart LED energy-efficient luminaires delivers significant electricity savings of upto 80 per cent.
On the other hand, greening the current electricity supply also supports energy efficiency and further decarbonise the energy sector.
Energy production represents nearly three-quarters of global greenhouse gas emissions and is at the heart of the climate change challenge. Sustainable growth in low-carbon distributed infrastructure can help accelerate industry decarbonisation.
The Middle East region has also an immense scope for large-scale renewable energy projects including solar. With some of the longest peak sun-hours in the world and vast empty spaces, the region can turn into a solar-energy powerhouse.
Additionally, governments in the region have prioritised renewable energy projects as part of broader sustainability goals, providing extra impetus for renewable energy.
Third, the rapidly declining solar energy prices present a great opportunity to scale PV installations – the global weighted average levelised cost of electricity (LCOE) of new utility-scale solar PV projects commissioned in 2021 fell by 13 per cent year-on-year, from $0.055/kWh to $0.048/kWh.
What role does technology play in creating sustainable energy solutions?
Technology and sustainability are increasingly intertwined. A recent WEF report revealed that 40 per cent of business leaders believe digital technologies are already positively impacting their sustainability goals.
The report notes that digital technologies are being used to measure and track sustainability progress, optimise the use of resources, reduce greenhouse gas emissions, and enable a more circular economy.
The key here is data and the capability to make use of it; organisations can pursue a data-driven business model in shifting from a traditional cost management approach towards tangible optimised business productivity. This provides environmental and operational efficiencies, improves service quality, and decreases costs.
Explain the challenges and opportunities that businesses face in the adoption of such solutions.
Many business leaders we talk to express a desire to participate in climate action but are held back by financial constraints. Whether in-house solar projects, or municipal smart lighting, they all require a significant initial investment in hardware, infrastructure, sensors and software.
Additionally, these systems are complex, requiring specialised skills and knowledge, which is challenging for organisations whose core business is not managing energy demand and supply.
To bridge the technical and funding gap, public-private partnerships (PPPs) models have emerged to support businesses and cities in raising funds needed for energy transition, boosting efficiency and raising technical standards.
In a PPP model, the energy development company will design, build, finance, operate and maintain the project throughout the contract period.
How can you assist in accelerating the transition toward a carbon-neutral world?
ENGIE Solutions in the GCC is structured across three core segments, through which we offer multiple sustainable energy and service solutions for cities, communities, industries and properties.
The first is local energy networks, covering cities and communities, including district cooling, public lighting and smart city applications as well as electric mobility.
District cooling networks play a significant role in reducing greenhouse gases and in the transition to carbon neutrality. Our equity stake in Tabreed establishes the company as the world’s largest independent provider of urban cooling networks.
We also offer cooling-as-a-service (CaaS), enabling organisations and smaller developments to benefit from a clean and energy-efficient cooling solution with no capital outlay.
Clients simply pay for the cooling they use; our incentive is to design, finance and install the most energy-efficient cooling solution supported by our expertise in plant maintenance, asset performance and longevity.
For municipalities with smart city/sustainability ambitions, we have built up a broad range of solutions for decarbonising cities hinged around efficient street lighting, connectivity and traffic management systems to improve environmental and urban safety while developing new services for citizens and municipal utilities. These include smart street lighting, low-carbon mobility solutions, 4G/5G wi-fi hotspots integrated into the smart street light network, CO2 monitoring, air quality and noise monitoring.
The second is onsite energy production for industries. Here, we offer utilities-as-a-service, an integrated onsite energy production solution to implement decarbonisation projects where we manage the design, build, finance, and O&M to allow clients to meet their decarbonisation goals.
Payments are service based over the life of the contract, with no Capex or debt, with results and performance guarantees. Our Utilities-as-a-Service offering utilises various solutions: Cogeneration, where heat and electricity are simultaneously produced in a single plant; Waste Heat Recovery, where we reuse heat energy that would otherwise be disposed of; onsite solar and more.
Onsite Solar PV is a popular renewable energy value proposition for regional businesses. We will build, own and operate the solar PV system, designed per clients’ needs, typically on the rooftop or adjacent vacant land. The system’s total electricity output is sold to the client at an agreed price and contract term through a PPA. Clients are billed monthly, while we ensure system performance through prescribed operations and maintenance during the contract term.
The third of our core competencies is energy performance and management for buildings and properties. In our energy-as-a-service solutions offering, we provide customised finance and guaranteed energy efficiency solutions to reduce consumption for our clients. We do so through designing, installing and operating smart technologies, energy-efficient equipment and carbon-free solutions adapted to various sectors.
Can you highlight some of your successful partnerships in the region?
We have provided energy solutions for some of the region’s most prominent retail, healthcare education and public developments. Recently, an Engie/EDF consortium was selected by the Abu Dhabi Investment Office (ADIO) to deliver Phase 2 of Abu Dhabi’s Road Lighting LED PPP project. The project includes the finance, supply, installation, operation and maintenance of 133,473 LED energy-efficient luminaires in the emirate. The project will result in significant electricity savings of almost 2,400 million kWh, equivalent to a reduction of approximately 74 per cent in power consumption over the 12-year concession period.
In the industrial sector, we signed a 10-year BOOT agreement with a UAE-based cement factory to develop a Waste Heat Recovery system. The proposed solution is based on the Organic Rankine Cycle technology which uses an organic, high molecular mass fluid. The fluid allows Rankine cycle heat recovery from lower temperature sources like the industrial waste heat from cement production. Based on a closed-loop thermodynamic cycle, the ORC system will help the client avoid 29.2 kilotonnes per year of CO2 – representing a reduction of 28.35 per cent in power-related emissions and a 3.9 per cent reduction in total plant emissions.
While ORC technology is proven and widely used in other sectors, we will be implementing this technology for the first time in the region’s cement production sector. Through this 10-year BOOT agreement, we are shifting the mindset of industrial companies in the region by demonstrating that financed energy-as-a-service solutions can accelerate decarbonisation strategies and allow the region’s industrial and manufacturing sector to focus on core business while helping achieve greater efficiency and sustainability goals.
In Saudi Arabia, we developed a solar PV park as part of a 25-year corporate power purchase agreement with Nadec. The facility, located on an area of land spanning 766,000 sq. metres, roughly equivalent to 21 football pitches, has a capacity of 30MW. The solar PV park features 75,000 photovoltaic bifacial modules with single access trackers, string inverters and fully automated robotic cleaning, helping boost their production capability and cost-efficiency.
This project will reduce Nadec’s fuel consumption by 124,000 barrels per year, reducing 53,000 tonnes of annual carbon emissions and allowing Nadec to align its operations with Saudi Vision 2030.