Read the double interviews with our stakeholders here.
In April of last year, the grid managers together with Gasunie presented the study II3050 to the outgoing Minister of Economic Affairs. It examined and described what the energy system will look like in 2030 and subsequently in 2050 and what this means for us as grid managers. ‘A wonderful product’, says Manon van Beek. ‘It shows that societal considerations and political choices determine the route to 2050. The greatest change in our energy management arises from generating electricity from sustainable sources that depend on the weather. As a result, electricity supply and demand cease to be linked. We need to bridge the gaps with new forms of flexibility in our energy system.’ ‘The study shows very clearly what the consequences of the energy transition are’, Koen confirms. ‘Put simply, streets will have to be opened up in many places. If we reach efficient choices in close consultation, that will save a great deal of inconvenience, time and money. These are major factors for social acceptance.’
Chicken and egg problem
But what do we do as grid managers; what is the correct order? ‘We need the government to break through the chicken and egg problem and to make choices for an integral approach’, says Manon. ‘What the grid managers would like is a systematic, efficient and above all phased roll-out of the infrastructure needed for the electrification. We simply cannot work everywhere at the same time. This has to done in phases and on the basis of an assessment framework.’ Koen is curious about Tennet's considerations for the purpose of prioritisation. Manon: 'We need help in the phasing of projects. We can only reach that phasing by means of prioritisation: which project is to be executed sooner, and which project can be carried out later? At present, customers are connected on a first-come, first-served basis. That is the implementation of the current legislation that prescribes this. The assessment framework must be endorsed by the government. Together with the national, regional and local public authorities, we must start prioritisation and phasing. What will we do first and what has to be done later?’ A structured approach is absolutely necessary, Koen believes.
Making better use of the grid
TenneT and Stedin also collaborate on grid congestion, including in Utrecht. Manon: ‘This announcement gave rise to a great deal of public noise. There is no “simple” solution; we therefore jointly support the call of the employers’ organisation VNO-NCW, for instance, to join forces – also in a Netbeheer Nederland context – and to look for solutions.’ Koen sees making better use of the grid as one of the solutions. 'If we match supply and demand more closely, that will also reduce the need for us to transmit electricity.’ The concept of the 'fast lane', in order to accelerate permit procedures, is another interesting idea, Manon believes. Koen agrees with this. ‘This is a huge challenge. That means that we also need quicker processes. Seven years for a permit application for building a medium-voltage station is very long. Acceleration is required if we want to achieve the climate goals. Permits are an important aspect of this.’
Recruiting technical talent
That acceleration can only take place if we also have enough technical talents. Manon: ‘We are looking for thousands of technical talents in the energy sector in the years ahead who can help us to put the required infrastructure in place. We are all fishing in the same pond. More financing is required for technical training programmes and graduation premiums for students. We are jointly committed to this.’ Koen is pleased in that connection with the cooperation in the Training & Development (T&D) fund, for example. ‘As far as I am concerned, in-house training, like we provide in our In-house training school, is a key way of attracting talent. If we can do that in more places, that will help enormously to ease the huge challenge we face.’
In conversation with Annette Ottolini & Trudy Onland
Smart collaboration is essential to moving resiliently forward. This is the only way for us to fulfil our social responsibility while at the same time tackling scarcity in many different areas. Annette Ottolini, CEO of Evides Waterbedrijf, and Trudy Onland, COO of Stedin, discuss how to develop effective collaboration in critical infrastructure and also where the challenges lie.
If you put the water company and grid management side by side, you see two organisations with many similarities: both manage essential utilities, both have a clear position and role by virtue of legislation and both face similar challenges. As Annette says, ‘Different as they are, electricity and water nonetheless have current in common.’ They face a shared challenge in terms of scarcity, evident in a shortage of qualified staff, an increasingly crowded subsurface and scarcity of materials. And with both companies sharing routes and having abutting operations below ground, it is only logical that they should work together. That is efficient and is in the interest of society in general. However, cooperation also presents some interesting issues.
A shining example: cooperation in Zeeland
When asked about her experience of cooperation in the past year, Annette first mentions the Cooperation Agreement for Zeeland, which Evides and DNWG/Stedin signed at the end of 2020. The two parties have a long history of working together below ground in Zeeland, with DNWG previously being contracted by Evides to carry out work in the province. With the new Cooperation Agreement, this relationship changed into one of equal partnership. ‘That change called for a high degree of coordination. Naturally, we were always driven by the desire to make life easier for our customers in
Zeeland. That means adopting efficient working practices and making quality and safety a priority at all times. The cooperation is good, and customers are highly appreciative of the good progress that is being made.’ Trudy, who has been on board at Stedin since mid-2021, also sees the cooperation in Zeeland as a shining example. ‘Customers don’t want the road to be dug up all the time; they just want to be able to park their car near their home.’
The same language
Annette believes the fact that both sets of employees ‘speak the same language’ is beneficial in the cooperation between Stedin and Evides: ‘Both organisations work with professionals. That our companies are similar is also evident in our shared focus on safety, for example. This common ground facilitates cooperation between us, at all levels.’ It is true that highlighting possible differences in our respective DNA is the last thing we need, adds Trudy. ‘For that reason, it is important that we can have access to what goes on behind the scenes, in terms of operational planning for example, at each other’s companies. Openness between us is crucial. It’s okay if our interests are not always the same, but let’s be honest and open about it. That creates clarity.’
Rules governing cooperation
Legislation makes cooperation between different parties in the subsurface difficult at times. ‘Yes, it’s complex,’ says Annette, ‘but we have found a solution, in the legal field, which enables us to work together.’ Trudy finds the current legislation ‘regrettable’ more than anything. ‘Because it means we sometimes have to construct unnecessarily complex arrangements to allow the same people to perform combined work in a smart manner. That shouldn’t be necessary in a tight labour market.’
In conversation with Guido Frenken & David Peters
How to meet the huge challenge of the energy transition with smart and effective strategies? That is one of the key issues facing Guido Frenken, Global Head of Innovation & Digital at technical service provider EQUANS (part of ENGIE), and Stedin Chief Transition Officer David Peters.
It goes without saying that 2021 continued to be dominated by the coronavirus pandemic. ‘The interpersonal aspect in particular is more important than ever,’ says Guido. ‘The past year has shown how important social interactions are for us as humans. The energy transition is also clearly at the top of many people’s minds. Every news summary nowadays includes an item directly related to sustainability. That is really a huge change within the space of just a couple of years.’ ‘The energy transition has definitely moved front and centre,’ agrees David. ‘It is critical to remain in dialogue at this crucial time. Many people think that the energy transition is about technology and digitalisation. While both are important, the real driver is people’s behaviour. There is a risk that increased digitalisation, combined with the pandemic, will cause everyone to become locked in their own world. And there is no doubt it is easier to hide away when things get complicated. But that is exactly what we shouldn’t be doing right now.’
Transition is about behaviour
A key element of the transition, says Guido, is the message that the energy transition will not be painless. ‘At the end of the day, a transition is about adopting different behaviours and about changes that come with a price tag. To soften the pain, it is important to make the right choices, think in terms of solutions and create the feeling that, by working together, we can do this.’ Are we doing that right now? ‘Sadly, no,’ says Guido. ‘We are stuck in past patterns and behaviours. That is a big problem for decision-making in particular. For instance, it can take up to seven years to secure a permit. If you invest during that time, you will burn through a lot of money
just through waiting. That money could have been put to other uses.’
Risk: yes or no?
‘You can’t manage a system transition,’ says David. ‘You’re continually forced to compromise. When is the right time to risk investing or launching a project, and when is it better to wait? And risk-taking is not something we like to do.’ Guido adds, ‘The heat transition in Delft is a good example. Everyone is keen to press ahead with the project, which in itself is unique, and there is a valid business case. In spite of this, the process is beset by serious delay, as all the boxes need to be ticked. But the boxes aren’t relevant for the end result. Then I think to myself, “is there no other way?”’ The transition calls for perseverance, says David. ‘But it also means that we need to change out mindset and just say: let’s do it. That is difficult, particularly for people in public office. They are subject to intense scrutiny and are mercilessly judged on social media. They honestly need to be thick-skinned. I have a lot of respect for them. Perhaps we should encourage greater interchange between public authorities and businesses, to create more mutual understanding.’
Making smart use of grids
When it comes to smart grid usage also, it is important always to consider how we can help each other and how we can make effective use of the grid. ‘There is still so much to be gained, particularly if we can make even smarter use of data,’ says David. ‘And what about thinking far more in terms of co-creation here too?’ adds Guido. ‘At present, grid managers are quick to repeat the mantra: “Thou shalt install.” I would like to be able to go to the grid manager and say: this is a case for society in general; how can we fix it together?’ David adds, ‘And if the two of us get good at these solutions, we are also creating a valuable export product as a country!’
In conversation with Jan-Willem van den Beukel & Danny Benima
The climate targets, RESs and the financing challenge facing grid managers are driving increasingly closer cooperation with municipalities. In this double interview between Jan-Willem van de Beukel, alderman responsible for finance of the municipality of Lansingerland, and Stedin CFO Danny Benima, they delve more deeply into that cooperation. The joint conclusion is clear, ‘We have to act as a single authority.’
A series of events in 2021, including flooding in Limburg, rising gas prices and the latest climate conference in Glasgow, made the energy transition front and centre all of a sudden, says Jan-Willem. In spite of the negative impact of some of these events, they have generated widespread understanding of the need to accelerate the energy transition. We need to act now.
In Lansingerland, that action is taking very concrete shape in the form of the planned branch of the WarmtelinQ network to the municipality, which will transport residual heat from the Rotterdam port area to The Hague and surrounding region. ‘That branch represents an important success,’ says Jan-Willem. ‘Our municipality is home to a large greenhouse horticulture cluster, which at the moment uses natural gas, geothermal energy and residual heat from a conventional power plant. The branch provides an important impetus to retaining the sector’s competitiveness, since it enables even more combined heat and power systems to be disconnected, provided that the heat is affordable and reliable and the CO2 network is simultaneously expanded.’ For Danny too, the very concrete actions taken are the highlights of 2021. ‘The €200 million investment by our shareholders, several improvements in the Method Decision after concerted lobbying and the fact that we managed to engage central government to consider whether and, if so, in what way they can contribute financially to ensure the success of the energy transition are all necessary steps towards facilitating the concrete projects Jan-Willem refers to.’
Who provides the financing?
The conversation with a CFO and an alderman responsible for finance very quickly turns to financing the energy transition – an important, complex issue. Would Jan-Willem be open to the possibility of non-public organisations also contributing financially? At present, the legal possibilities are limited. ‘Let me state clearly that I am pleased that times have changed after the years of privatisation activity and that we are now seeing a reappraisal of public goods. I am not against other parties in principle, but I prefer for us to act as a single authority and take steps jointly to ensure a robustly financed grid manager. After all, the grid concerns us all. We now have the opportunity to set out a clear path for the coming decades. So I would prefer first talking with municipalities in Stedin’s area that are not yet shareholders and also entering into dialogue with the provinces and central government.’
Danny, too, has no objections in principle to non-public organisations, provided that they are identified with social responsibility. Nevertheless, his preference is for public parties: ‘The added value lies not just in the financial domain. Municipalities and provinces are also partners in the RESs. Combined action in relation to spatial planning issues can lead to significantly shorter lead times. ‘That is entirely in line with my idea of acting as a single authority,’ says Jan-Willem. ‘Stedin's service area should ideally map perfectly to the shareholders so that, together, we can tackle the challenge as a single authority.’
In the past year, we have been surprised on several occasions by unpredictable developments in the energy market, such as the sharp rise in gas prices and congestion. How do we get more grip on this? Jan-Willem smiles. ‘The question is whether it is actually so unpredictable. I have my doubts. We’re all in the process of phasing out fossil fuels; we’ve known that for some time. These are the inevitable severe hiccups that accompany any major change of this type. As public authorities, we need to get better in terms of strategic competence and long-term thinking. We have the capability – just look at the Delta Works. But it needs to become far more embedded in our thinking.’
Danny: ‘Traditionally, we are an organisation with a long-term strategy, and that long term was always very stable. In terms of investments as well as the one-dimensional nature of the energy system. Nowadays, however, we are facing a system transition with multiple uncertainties, including customer demands that are developing faster than expected, rising energy prices and prices for other commodities, and shortages of materials and staff. Political decision-making in relation to the energy system and the desired speed of the energy transition are also making it challenging to make clear and accurate judgements for the long term. We have significantly improved our ability in recent years to think in scenarios and translate that to strategic decisions and calculations. Last year, we asked McKinsey to review our investment plans, which concluded that we have a robust and mature process. That confirms that we are on the right path.’
How does Jan-Willem see Stedin’s role in the energy transition? ‘I believe that Stedin, and the same also applies to the municipality, by the way, plays a driving role in the change. An important element in this regard is providing clarity to customers. When someone in our municipality wants to install charging points on their land, for example, and it then takes 20 weeks to connect the charging points, they can become quite irritated. If something like that is made clear in advance and you are open about the dilemmas you face, then it is far more likely that you will forge a true partnership with customers in the energy transition. We need to embrace the concept of ‘system-based thinking’, where everyone, customers included, moves in the same direction.’ ‘There is much still to be gained,’ says Danny, ‘but we’re moving in the right direction. As a grid manager, we are bound by legislation and regulations and are simply not able to do certain things. But let’s focus above all on what is possible. After all, ensuring the success of the energy transition is a shared responsibility.’