Thirty-nine business leaders from eighteen forward-thinking companies, including electric utilities, technology providers and companies from the transport and industry value chains, took part in the Strategic Open Dialogue on Electrification (SODE) roundtable held under the theme Decarbonizing Businesses through the Electrification of Processes last week in Rome. The discussion hosted by Francesco Venturini, CEO of Enel X and Head of Enel X Global Retail, delved into enablers and challenges faced by businesses in decarbonizing their industrial activities, as well as the potential for concrete collaboration among stakeholders and across sectors to promote progress.
The electrification of processes is an innovative new methodology to reduce industries’ carbon footprint while improving performance, efficiency, and flexibility. Readily available technologies are a first starting point to electrify a large array of processes, but studies are needed to ensure decarbonization challenges can be faced by businesses without significant further investment. Last week’s dialogue highlighted some of these opportunities and touched on possible solutions to barriers to the electrification of processes faced by industries.
Key insights emerging from the discussion included:
- One of the most pressing barriers to the electrification of industry compared with the oil and gas companies is lack of awareness and knowledge of possible decarbonized solutions. In order to increase energy literacy, electric utilities and technology providers must share information and educate customers and communities on electrified technologies and their economic and social benefits, but also provide proper training and information to employees and final users of such technologies.
- Utilities and technology providers should rethink how to push specific business solutions through the construction of innovative business models with the final aim to manage complexity for the final client, thus guaranteeing simple and efficient solutions. Electrification of a business must be easy, efficient, and affordable but also provide a clear return on investment. In addition, the role of digitalization and software could be one key to boost the decarbonization of businesses.
- Developing the necessary infrastructure and access to clean energy supply is also a key enabler to drive electrification solutions in industry. The grid must provide the flexibility and accessibility essential to integrate advanced technologies and streamline the electrification of processes. To enable the electrification of industrial processes, the power grid must be upgraded with high-capacity transmission lines and substations capable of handling large loads. Moreover, the grid has to be able to guarantee extra capacity in order to correctly manage the extra electricity need and to address country’s specificities.
- Transversal processes (e.g. space heating and pasteurization) offer strong opportunities for cross-industry collaboration driving electrification across sectors. There are numerous synergies to be developed along the value chain in terms of cost-optimizing, knowledge sharing and standardization. Moreover, every production line needs maintenance and revamping, so a quick win solution is to electrify towards the end of plant life in order also to maximise the economic return. However, it is important to take into consideration that access to capital is becoming increasingly expensive due to the current economic framework. A multitude of solutions exist to help electrify processes, such as financial tools (e.g., ESCOs) and public innovation funds.
- As we move towards a sustainable future, businesses across sectors must electrify to remain competitive with industries supported by country stimulus accelerating their energy transition. In addition, smart and well-targeted policy incentives, enhanced performance standards, comprehensive regulatory frameworks and smooth authorization process are all needed to establish a level playing field for clean energy and electric solutions and facilitate the electrification of processes.
The roundtable was the first of a series of four exclusive discussions to be held throughout the year focusing on deepening the collaboration and dialogue between different stakeholders across the value chain through the sharing of insights and lessons learned vis-à-vis the five pillars identified in the Catalyzing Electrification Accord signed by SODE participants last year.