Cleaning Up. Leadership in an age of climate change.
March 10, 2021

Ep34: Kristian Ruby 'Electrifying Almost Everything for Net-Zero'

This week, Kristian Ruby, the Secretary-General of Eurelectric since 2017, will be joining us for a conversation. Eurelectric is a pan-European organisation with the aim of representing the common interests of the electricity industry. He was also once part of the Danish government in the Ministries of Climate and Energy as well as Environment.

Bio

Kristian Ruby has been the Secretary-General of Eurelectric, a pan-European organisation with the aim of representing the common interests of the electricity industry since 2017.

Prior to this role, Kristian was Chief Policy Officer at WindEurope between 2015 and 2016. This involved producing political strategies as well as leading the political advocacy work. From 2014 to 2015, he was Chief Advisor/Manager at Operate A/S who work closely with corporations, ministries, and government agencies with PR campaigns concerning climate and the environment.

Kristian has political experience as well. Between 2010 and 2014 he was working as an assistant to Connie Hedegaard, the EU Commissioner for Climate Action in the European. Prior to this, Kristian held several roles in the Danish Ministry of Climate and Energy including speechwriter, head of press, and special adviser. He was also acting head of press for Minister for Climate and Energy, Lykke Friis during COP15 in Copenhagen.

In the earlier years, Kristian had a career in journalism working as a freelancer as well as for Danmarks Radio for 5 years. He attended Roskilde University where he completed his BA in International Development and his MA in History and Development Studies.

Further reading:

Official Bio  

https://be.linkedin.com/in/kristian-ruby-143685  

Europe’s vehicle fleets to boast 10.5m EVs by 2030 (February, 2021)  

https://www.energylivenews.com/2021/02/03/europes-vehicle-fleets-to-boast-10-5m-evs-by-2030/  

‘Not fit for purpose’: Europe’s distribution grids ‘need up to €425bn of investment to enable energy transition’ (January, 2021)  

https://www.rechargenews.com/transition/-not-fit-for-purpose-europe-s-distribution-grids-need-up-to-425bn-of-investment-to-enable-energy-transition-/2-1-944581  

Leaders of our industry: Kristian Ruby of Eurelectric (November, 2020)  

https://www.pveurope.eu/markets-money/leaders-our-industry-kristian-ruby-eurelectric  

Bringing utilities on side in the climate fight (September, 2020)  

https://energymonitor.ai/technology/electrification/bringing-utilities-on-side-in-the-climate-fight  

Eurelectric boss: ‘The gas system has to be more focused on what makes it really unique’ (February, 2019)  

https://www.euractiv.com/section/energy/interview/eurelectric-boss-the-gas-system-has-to-be-more-focused-on-what-makes-it-really-unique/

Transcript

Click here for Edited Highlights 

Michael Liebreich 

Cleaning up is brought to you by the Liebreich Foundation and the Gilardini foundation. Hello, my name is Michael Liebreich, and this is cleaning up. My guest today is Kristian Ruby, the Secretary General of Eurelectric, which is the association for the whole of the European electrical industry. Kristian started his career in policy with the Danish Ministry of Energy and he's also been Special Assistant to Connie Hedegaard, the former EU climate Commissioner. Please join me in welcoming Kristian Ruby to cleaning up. So, Kristian, welcome to cleaning up. 

 

Kristian Ruby 

Thank you very much. 

 

ML 

So we haven't met for? Well, it's probably nearly two years now with one thing and another, including COVID, what have you been up to? 

 

KR 

I can tell you, we've been very, very busy. It was already busy before COVID, we had a whole bunch of new MEPs coming into the European Parliament. So we were gearing up to meet them all and establish relations for a new political mandate. And, and so we're, we were getting cracking on with that. And then all of a sudden, COVID hit and we were just sort of getting exponentially more busy, trying to get our heads around the industry trends emerging from that trying to fix our digital systems, transitioning the entire staff to remote working and, and since then it's just been crazy.  

 

ML 

Let's do the following. Let's take a step back. Because you know what Eurelectric does. I know what Eurelectric does. But the audience may not. I'd almost say they probably don't. We've got a very diverse audience. Some of them will, some of them are great friends of ours. But why don't you explain what the organisation is and what you work on?  

 

KR 

We're the trade body of the European electricity industry. So we represent the electricity industry, towards policymakers mainly in Brussels. That means that we basically develop business intelligence analysis, we present it at big events, we talk to policymakers, come up with recommendations, we try to coordinate positions across the industry. So the policymakers know, not only what's our association, but what really could fly with the entire industry. It's a big one, we have around 3500 companies in total in Europe and account for an overall turnover of some 700 billion euros. And, you know, regardless of what percentage point of the GDP it is, it's always the first because it's where the energy comes from. And that's what powers the economy. 

 

ML 

And your members. Obviously, there are utilities, but what else is there in your manager? How broad is your membership? 

 

KR 

So in essence, we're an umbrella organisation, so that we are essentially an association for the national associations of Europe. So the energy UK is the BD Ws, the USE’s from France, the big energy associations are all our members and control our board, they then have the entire value chain represented in their different associations at national level. And it depends a bit what country you look at, what kind of membership they have, some have really from Tesla to, to Siemens, Gamesa, others are more focused on the national electricity industry providers, so the generators and the grid operators. But the overall picture is a very broad one, and, and more and more, that's also what we're trying to do in Brussels, we try to broaden that scope, we try to look beyond the sector, because the next stages of this energy transition is really all about going over and beyond looking to other sectors, whether it's transport industry or buildings and forge alliances, make partnerships that can basically provide those sectors with green energy. 

 

ML 

So you'd be happy for those, let's say a major housebuilder could become a member. 

 

KR 

So I think... 

 

ML 

Directly international through one of the national... 

 

KR 

They could in principle through the national associations. So at the end of the day, it's my members who decide who they want to bring into the association. And I think we do have sort of a distinction which is, Are you an electricity provider? Whether it's because you generate electricity or you transport electricity, or are you a component manufacturer or some sort of supplier and we have a little bit of a different category for those because they're great for us to work with and exchange ideas with learn from Digital players or component manufacturers, or some kind, but we try to sort of focus our positions and our thinking around the core players, which are the ones that really are engaged directly in the value chain of electricity production. 

 

ML 

Okay, now, this sounds very sort of technocratic, and I'm smiling a little bit becuase I know that that is not how you run it. And also, it's not really the role you play, because you have, I don't want to say expand it to fill a vacuum in, you know, in any manner that would be that would be presumptuous of me to say it, or have you done it, but you really do lead it, you really provide the thought leadership, collectively, you and your members that is driving forwards the energy transition. That's how I see it. 

 

KR 

Well, thank you very much. I'm very flattered. And I think that credit should definitely go to many of the great people in the membership and industry. I think that you know, I do agree. I mean, I came to Brussels 10 years ago, and everything in Brussels felt extremely bureaucratic and technical to me. The whole city was just woven into a maze of completely understandable abbreviations. And you couldn't say anything without making it extremely complicated. On top of that, you have all the processes. What does the commission do? What about the council? And what about the parliament? How do they play together? And what about the industry interest into all this and all this sort of sprouting of interesting platforms and whatnot, that basically constitutes this policy landscape. The fascinating thing, once you get into this is that this is really the machine that governs Europe. And that's why it's so extremely important also for this cause, if you will, for this transition, which is absolutely critical for mankind, and for the broader planet, by the way, in the next 10 years and certainly also in the next 30. So, so it does feel technical, it does feel, you know, bureaucratic at times, but once you sort of come into what it's really all about, which is creating unnecessary critical change, over the next 10 years, you sort of reconnect with with the feeling that you're doing something important, and you're doing it even if it's sometimes technical and nerdy. 

 

ML 

I suppose I think you brought a lot of that sense of mission and direction, and the urgency and the obligation. You know, I wouldn't be critical of your predecessors that way. But, but it did definitely ramp up and you arrived? And what was very significant also, was that your background, you were brought in from Wind Europe, which was a huge shock, a huge shock to people like me, were not expecting that of you know, staid old, your electric. 

 

KR 

No, I think, I think, to some extent, there was perhaps also a perception of what Eurelectric was, and, and, and what wasn't reality. But that said, I agree with you, I wasn't surprised for many, perhaps including myself that the industry accepted me and took me as their representative, if you will, the highest representative of the industry, in Europe. And, and, and one thing was that I came from renewables. But perhaps just as surprising. My background is not one of an engineer I came from, from policy, I was working in the ministries of Environment and Climate in Denmark, and then came to the European Commission, working for the Climate Commission to kind of had the guard at the time. So I was much more of a policy person than the classical industry figure that was usually thought of as the one that would head a big industry association like Eurelectric.  

ML 

Yeah, you know, I saw Eurelectric as being essentially an association of companies that, frankly, would rather there was no transition back then. You know, I look at it as companies that were not they were not the nimblest companies, they were not the ones that were, you know, embracing change. They were very engineering driven. I would say that some of the executives I'm not even sure really believed that there was a need to change in any way. And suddenly, you know, they've plumped for you know, Kristian Ruby, this kind of, you know, crazy climate transition guy, not crazy, but you know, but that's very much the environment that you've come out of. 

 

KR 

Yeah, yeah. So as I said, I think that that probably has to... 

 

ML 

Tell us how did it happen? You talk us through the politics that that group embraced you and put and chose you as their president? 

 

KR 

Well, I must be totally honest. And see, you know, I saw it from the outside. I mean, I was I was approached by an executive search company that asked me whether I was interested in this position. And, and I must admit that at first I felt it to be slightly out of range or out of reach. And, and well, but I think the real transition is probably one that happened in Eurelectric inside Eurelectric in the bore through discussions? Where are we? Where are things going? And where can, you know, what are the opportunities for our industry? And, and how do we sort of find a leadership that, that sort of, can, can get us closer to those opportunities. And, but in any case, I mean I really want to emphasise that I have met some of the most visionary thinkers in the Eurelectric membership, I learned so much every day, I go to work about the details. And, I really do think that there's a lot of thought and a lot of interesting reflection going on in the membership. And the last thing, which is this interesting thing about, you know, whether or not people wanted to transition and who wanted it, and so on, I think what we need to remember and probably also in the next stages of this transition, is that the reason why companies that operate, the electrical system can be a bit conservative at times is that we all rely on the electricity to flow, people get really, really in a bad mood, if the electricity doesn't flow totally, predictably, we're seeing you know, the mess in Texas, frankly, right now, just how serious it is when the power already all of a sudden is gone. So, there needs to be I would even say perhaps a certain level of conservatism, which is, let's do the change, but let's make sure that the power flows continuously throughout. Otherwise, we could be in real trouble. So I think that that may be part of that conservatism you're talking about. 

 

ML 

Yeah. And I would certainly endorse your point about some of the most visionary people. I misspoke. I said, President but of course, you're the Secretary General, but you work under what had been a series of really quite extraordinary chairs. So Francesco Starace... you know, these are really pretty visionary thinkers, are they not? I'm sure, you know, they're... 

 

KR 

Absolutely the same goes for Magnus Hall... all people that carry a very, very strong sense of society in them, and a very strong sense of service to society, that the transition is absolutely needed. And, and that we, as a sector hold a huge potential, and a huge set of really, really attractive solutions to deliver on it. And I think those that sense of, of, let's say, commitment and and service to society, combined with, with the ability to see that this enormous opportunity is really one that, you know, characterises the best leaders of the sector. 

 

ML 

Exactly, without doubt. And I think that one of the sort of campaigning directions that you have taken, has been around electrification of everything. So electrify transport electrify heat. And, you know, of course, it's kind of self serving, right, your Eurelectric, there's a kind of clue in the name. But how did you come to adopt electrification sort of mandate? 

 

KR 

I think in essence, it goes sometime before me even the it was a thought that was sort of given birth to already some years back. And it was this idea that if we electrify or rather if we decarbonize First, we make ourselves an interesting option for others. to rely on us. So, that fundamental sort of connection between having an energy source that is future proof and then, you know, committing to, to delivering that, in return getting a lot of additional business out of that, I think is one that pretty much any businessman can understand. And, and what I felt when I arrived was that we had to sharpen our commitment to the clean energy, it was sort of done before and by 2050, we would be carbon neutral, but, but then the sort of thinking about how that was going to happen in practice was perhaps less prevalent in the advocacy of Eurelectric which, which was focusing at the time more on, on, you know, establishing a proper market and, and security supply, both of which are super important things, but, but when I arrived, I sensed that, that having seen Eurelectric from the outside there was really a need to feel that this industry cares and, and wants to double down on that commitment. So we, we made a process together with Francesco Starace, and where we involved all the CEOs and said, let's try to put it as clearly as possible on one piece of paper, what we're going to do, and, and why we believe electrification is really a huge opportunity, not only for us that produce electricity, but but for society and for the citizen. And, and we had a good process with everybody, we basically had a, you know, clear involvement process of all the executives in the sector, and we got everybody on board to say, we will go for this well before the mid century. And that was sort of one first step, which was we could not, we could not double down on a specific number at the time, because we didn't have the analysis but that sense of urgency and the direction, which is we're going to do it faster, we're gonna go as fast as we can, was a very important first step, which allowed us then to develop a very comprehensive set of analysis, pretty much across the entire economy. The McKinsey study that is quoted worldwide now and also, I believe, by Bill Gates in his latest book, then individual sector studies on transport on heating, on industry, and so on and so forth. And, and based on that, we've been able to come closer to what is actually technically doable, and how fast can we do it? How much electricity are we going to need? And, and what are the general proportions of this gigantic transition that we have to do? Which is sometimes, you know, a little bit intimidating, but then but also fascinating in its opportunity. 

 

ML 

Okay, so of the innocent, two pieces that you've talked about, which is electrify everything and have clean electricity. What your I think you're saying is that the go clean came first the commitment that get everybody around the table and get your members to agree that you're going to go clean that that came first. And then once you do that, then suddenly you start to see the opportunities, because once you're clean, you become the pathway for other sectors. Is that a fair characterization of the process? 

 

KR 

Yeah, and I guess maybe my contribution was to turn that around, because what we often saw when we told the story the other way round was, yeah, we understand you just want load growth, you just want more business so shut up, by turning it around saying we care about society, we care about this huge problem we have as mankind and the thing that made us you know, cripple our civilization 30 years from now, we care about them, we're gonna fix it, then all of a sudden people are like Okay, I'm gonna buy something from those guys not the other way around.  

 

ML 

So that's really fascinating because, you know, I love in these conversations with your leaders have now done more than 30 I'm always on the lookout for these kind of those critical moments when frameworks are changed. And what that brings to mind is the difference between COP 15 and COP 21, COP15, Copenhagen where it was top down, we're going to have a budget, and then we're going to divide it up between all the nations and then we're going to spend 50 years implementing it and it's going to be binding and top down. And then COP 21 and Christiana Figueres in her episode, which was think was going to say number seven, it was one of the earlier episodes. You know, she talks about how she flipped it around and said, Look, we're not going to do it top down. We're going to listen to everybody and we're going to do it top. We're going to do it bottom up, and every is going to be encouraged, bullied, you know, bounced into making the commitment, and it's going to be bottom up. And that change of paradigm, then kind of enables all the dominoes to fall and you get action. 

 

KR 

It's very interesting thought and what it sort of leaves my thoughts is something I've been reflecting on recently, which is the difference between the electrification paradigm and the hydrogen paradigm, the hydrogen paradigm is very much one, which needs to be top down because it requires basically building everything from scratch. And in doing so very fast, extremely capital intensive. Whereas what's happening in the electrification space now is that one by one, the car manufacturers are saying, we're going to electrify that then triggers a lot of considerations on the grid operator sciences. Okay, how we're going to serve up to that new demand that's coming. The people with the ferries are saying, okay, we're going to electrify this one, we can do it because it's only, you know, whatever, 30 kilometres to the other shore and if we have a big battery at both ends, we're good to go. So, the nature of the electrification paradigm is one that is more decentralised. And I think that's why it's ultimately also going to be more successful, I should say, for the record and respect to all my members that we don't say electrify everything, because there are a few things that we can't electrify. And we've actually spent quite a bit of time to drill down and say, what exactly can we electrify? Where can we not electrify? And what's that share. And what we get to there is that we believe that a net-zero economy would require 60% electrification or 60% of total final energy consumption to be electric by 2050. And we can come back to the details and what's not electric them and so on and so forth.  

 

ML 

No, you've done my job for me, because I was going to bring in the question of hydrogen, and you've done it for me. I mean, my own sort of the quote that I've used, I don't know if this ad, you were probably too busy drinking Carlsberg in Denmark, but in, in the UK, there was a very famous Heineken advertisement, which was Heineken refreshes the parts other beers cannot reach. And actually, I'm drinking, here we go. So this is my Heineken. Enjoying that, but what I say is that hydrogen will decarbonize the parts that electrification cannot reach that actually, because of its inherent complexity, and an inefficiency, because of the losses when you make it and then you convert it, that there's no reason to use it, if a direct electrical connection, and a battery can solve it. And that's fine for you know, most of what we do land transportation and heating, but it won't work for aviation, it won't work for long distance shipping, it won't work for quite a bit of, of the chemical infrastructure, but, but your figure of 60% of electric is probably lower than what I would have come up with. 

 

KR 

Yeah, look, I mean, what we did, the way we came up with this was really to sort of go to the best consultants that we could find, which was McKinsey, they had the best offer at the time, and, and then we wait worked with the biggest possible team they could come up with. And we involve all the industry experts, we could feel on our side, and we had, we had a really, really fantastic group of people working on this and, and what they did was basically just to drill down sector by sector, we, we looked at 50 sub sectors of the economy and basically went when technology by technology and said, what's at stake here? Is it you know, is it heating of water in some shape or form? Okay that that needs to be electrified? Is it more complex chemical process that requires some sort of chemical feedstock? Okay, maybe we need to look at something else, and so on and so forth. And, and then we looked at this also in a cost efficiency perspective to say, you know, you can, in theory, go with both hydrogen and electricity in different cases, heating, for instance, but in practice, you're gonna opt for the more cost effective one most of the time. And that's, that's by the way. Speaking of alcoholic beverages and energy. I was with Claude Turmes the other day, the minster from Luxembourg, who says hydrogen is the champagne of energy? I like that phrase a lot because it shows champagne is something very nice, but you want to think about when you drink it otherwise your pockets may be empty very soon. So spend it on the right occasions and, and, and think about other beverages with a slightly lower cost profile. If you just want to have a nice drink on a Wednesday evening.  

 

ML 

I'll stick with my Heineken. Of course  Claude Turmes was another guest on this show and I okay, I don't remember which episode number it was. sometime before Christmas. I'm going to guess something around number 20 sometime around the but anybody who's watching can find that that report that you talked about, is that published because we can add a link on our show notes if that's a published Eurelectric report that you did with McKinsey? 

 

KR 

Absolutely. Yeah. So, so we can provide the link for them. 

 

ML 

We will add that into the show notes. I smile when I when I heard you that you chose the best consultancy McKinsey. I was at McKinsey for five years, that makes me smile. But also my last interaction with them was I was invited to be an observer on the Hydrogen Council's report one of them on the costs of hydrogen. And I had to withdraw. It was being you know, the Secretary that was run by McKinsey. But the assumption was that there would be millions and millions and millions of fuel cell cars by 2030, despite the fact no major manufacturer is selling more than a couple of 1000 a year. And, and so I and I, I just said, Okay, I'm kind of, you know, I can’t fight this one, it's not worth it. But there are, there's certainly some kind of a bizarre situation right now, where, you know, there are people promoting hydrogen for uses where it really doesn't make sense. And they must know that it doesn't make sense. And I for one find that a little frustrating. Do you get involved in that? Or do you feel the same? 

 

KR 

Well, there's absolutely no doubt that there's been an enormous hydrogen hype also politically. And I guess, I mean, there's a few things to this, but I want to say that we have a lot of discussions about this in our membership also. And, and it's also very much about the energy systems in different member states, what can actually be done? How fast can you do it? And so sometimes, when people are advocating hydrogen it's basically because there's no good electric option? And it's not because it doesn't exist, theoretically, it's because it's just extremely difficult to implement, you know, give you one example, a huge capital city in Europe, where you'd think, Okay, why not electrify here? Well, it happens that that capital just has a big problem, you know, bringing more electricity into the city, where are you going to build the transmission lines for that, then you look at the individual household, why not put in a heat pump, that could work for the individual home. And then the other thing comes? Well, it happens that that city also has a situation where, where the owners of the buildings can't raise the rent for the people who live in the houses, that means anything they put into that house is going to be money out of the pocket. So you have a whole range of, of contextual challenges of one kind or the other, which is really about anything but energy physics, it's about society, it's about rules and, and laws and, and, and, and how we basically live together, that makes it very difficult. And that's why they come up with other ideas. You know, maybe we could do it this way. Maybe we could have a part and of, of hydrogen heating. Personally, I'm sceptical there as well. Honestly, speaking, I really struggle to see that how that can work practically. But I think I also want to guard just a little bit of curiosity sometimes because, you know, I remember how everybody was just talking down renewables 10 - 15 years ago, and you know, more than 3% the whole thing would blow up and wouldn't work and economy, economics were totally terrible, and so on and so forth. So, you know, I don't want to be that person that in 15 years, everybody was saying Kristian, he just didn't give it a chance. So let's, let's keep a little bit of openness, maybe things are can be a bit more different. It's not just all down to energy physics, because there's a lot of other things that need to be considered here. 

 

ML 

Look, you're more, you're more of a diplomat than me, which is why you vote, you know, to get and hold on to and succeed dramatically in the role that you're in. You know, I look at the people who are saying that renewables wouldn't work. They were actually ignoring the physics and the micro economics. And I agree with you, when you look at hydrogen for heating, where you've got 50% efficiency, if you're lucky, and you compare it to a heat pump, where you might have 200% efficiency through the coefficient of performance. I don't see where you're supposed to get all of the extra resources that you know, to produce that hydrogen. And you know, to do that, because of rent control issues, puts me in mind of a great quotation. I can't remember who it was, but who said that rent control was the single best way to destroy a city short of aerial bombardment. 

 

KR 

That's a nice one. Well, speaking about aerial bombardment or overflights I flew over London a few years ago, coming from Dublin, I think, and I looked down at that city, and I just thought, how are we going to decarbonize that mess, I mean, the heating system on London, that's a good sort of stress test for how easy it's going to be, it's going to be very difficult, 

 

ML 

I have had that exact thought, looking at some of the skyscrapers in London, when you look at net zero, and this is why I'm a big fan of place based solutions, you're not going to decarbonize London by saying, let's take that building and that building in that building, and they have a nice solution. But everything else you see doesn't, we're only going to be able to do it by looking at, you know, in a sense, whether it's council by council, or location by location, and integrating the buildings that transport that whatever economic activity that we've got, and also the hinterland, all of the area that supplies land, London, with food and with other with water services, and so on, we're never going to get to it just by doing, you know, little slices. 

 

KR 

I agree. And part of what we need to do, going forward is to, to think more radical as the same goes for permitting, where, you know, every single developer will be fighting an uphill battle with 10 different authorities and 10 lawsuits. And the more renewables we get, the more lawsuits and issues we're going to have, we're going to, I mean, one thing that I've been considering is, can we turn this around and say, look, if we agree on this build out, let's then sort of tick it off and sign it off. And then people can come with relevant... here or there. But this kind of, you know, fighting from house to house is not going to produce the energy transition, that we're talking about. But back to the council idea you're pursuing just before sort of, you know, location based solutions. One thing that we're talking way too little about in relation to the heating discussion is district heating. It's perhaps the less flashy part of what we call sector coupling or sector to the system integration. But actually, we have a very, very efficient system here. We have an infrastructure, that it would be a pity not to use, and, and one that can function very well with variable renewables and indirect electrification. It's just about basically jotting some sort of heating component down into that water and channelling all the all the surplus electricity into that. So that link between renewable energy or decarbonized electricity production, and district heating systems is one that should get much more attention my view, and would work in many different contexts in Europe. 

 

ML 

I agree with that. And I'm a big fan of shared loop ground source, where you do low temperature, and you have a loop, which is shared. And also, I'm an adviser to a very interesting company, which just raised actually 40 million US dollars from BP and Chevron, which does deep geothermal, but at a high temperature. So you can either generate electricity, or you could use it for district heating. It's a company called Ever Technologies. And I have a feeling that one way or the other, you're going to be hearing more about Ever. If for no other reason, then I'm going to probably mention them a few more times, each time we meet. But I want to ask you a question about a different technology. Now. You have members who are if not themselves, then from societies and political, you know, political environments, when nuclear is kryptonite, right nuclear cannot be talked about. You also have members from France, which is very dependent on nuclear and wants to continue to be dependent indeed the UK and I, actually, I don't know whether you still have members from the UK? 

 

KR 

We do. 

 

ML 

Good. Excellent. I'm glad to hear it. Delighted to hear it. So how do you square the circle of nuclear haters and nuclear lovers amongst your memberships?  

 

KR 

It's not always easy to be very frank, because indeed, as you describe it, there is that sort of, you know, that there's that variety of views on that specific technology. So what Eurelectric can do is basically to insist on the importance of electricity, and the electrification story, which in my view, is one that unites all those different views on a personal level, so I come from Denmark, so it's easy for me to sort of pick my favourite technologies and, you know, it's easy for a Dane to sort of envision a world run on the offshore wind we have in our backyard, I think we what I've learned in Eurelectric is that we have to accept that the energy map of Europe is one that's a bit more diverse than that, and that we, we need to be able to see the benefits of electrification also in contexts, that have another composition of the power mix. And, and I can just say, you know, look at France, they have the lowest, one of the very, very lowest emission profiles across Europe. And that's because of their nuclear fleet, and combined with renewables. So electrification is just a no regret option in France. As far as I'm concerned, you need to electrify all the cars in France as soon as possible. A lot of the heating, if at all possible, and big parts of the industry wherever possible, because that's the quickest way to low carbon for France. And, and for every single country, we need to look at that and say, how can these countries come very, very fast from their current emission levels to something very low? And there, we just have to say that if you have a low carbon power mix, regardless of what sources is actually powering it, it's a good idea to electrify that's what it comes down to for me. 

 

ML 

But you run events, you produce thought leadership. Do you find yourself… are you lobbied? Do you have to have a policy? Whether you do include nuclear, you don't include it? Or do you just, you know, it has everybody pretty grown up about it and just says, Look, it's you know, it's still producing nearly half of the zero carbon electricity in Europe, we're going to include it. And if they can produce low costs, small modular reactors, my members are going to be buying them. And we're going to talk about that. 

 

KR 

Well, I think that associations... so that's sort of the nature of association work that people come in and really double down on their particular view. And then you know, you need to find the middle ground. What we do take a lot of sort of professional care of is to make sure that we talk about renewable and decarbonized electricity, because it's that combination, to be very frank, that's going to dominate the mix. Now, in 10 years, and probably also in 20, and 30 years. 20-30 years, we don't know a lot. I mean, we so much can change. But what we have been able to produce in terms of a business intelligence, we're looking at a power mix, and a mix of power sources, also in the long term. We assess that it's going to be around, you know, pretty much in any scenario 80% renewables and then some other stuff. But that means we need to make sure that there's a business case for the entire system, and that the entire system works. 

 

ML 

Very good. I'm sorry, I didn't mean to kind of, you know, heckle to you about the nuclear question, but I'm sure it's one that you've sat through endless board meetings on. I want to make sure we cover a couple more topics. One is resilience, and the other is the run up to COP26 in Glasgow later this year. And we've got about 10 minutes left. So on resilience, we're recording this the week after these terrible life costing, you know, the people died in the power outages in Texas. The system failed, it failed dramatically. And of course there are those that say Oh, it was all because of wind and there are those that say it was nothing to do with wind. It was a system wide failure though. Nobody knows nobody and no technology comes out of it looking particularly good. Do you think that you as an association, are the electrical sector as an industry has thought hard enough about resilience? And if not, what are you going to do about it? 

 

KR 

I don't think anybody in this society has thought hard enough about resilience. I don't think anybody is really, you know, getting their head around what's coming at us, I struggle to understand that personally, you know, my house is maybe three 400 metres from the shore. I don't even know, I mean, I don't even know what the government predicts in terms of where sea levels are in 50 years. Because they haven't, haven't come around to sort of really face that fact. And I think that goes for large parts of society. And I think that science and nature has a little bit of surprises in store for us when it comes to just how much trouble we're headed for with climate change. So I don't think anybody has really thought hard enough about this. And I have been suggesting and promoting the idea that we should be doing some much more fundamental studies into this. So this is something that I expect us to be delivering on in the next few years. That said, I think that Europe is in a better spot than the US and specifically Texas, it was very clear that they didn't have a real plan for how they were going to deal with such a radical shift in the weather. When you look at power operations in Europe, yes, you've had some, yeah, we had, we had the we had the drop out in the UK is it one and a half years ago, apart from that, things are running pretty smoothly, you know, considering that, that it's, you know, 500 million people that we're powering every day. And we have systems in place, we have legislation in place, we have agreements in place between companies so that they can move fast if there is a serious situation. Three, four years ago, there was a huge storm in Ireland and, and 400,000 people lost power, because the lights just basically came down. They had an agreement in place with, with France, to bring over people to just help them get those grids up again. And this is the kind of stuff you need. And more and more, because the resilience question is, is going to be one of three top questions for any utility CEO in the next 10-20 years. When we meet with international companies, you know, CEOs from Japan, the US, it's all about resilience, it's all about disaster management, it's all about, you know what kind of drones, you fly out to the end use customer in case you have a fundamental breakdown, reinforcement of cables and lines, barriers around your transformer stations to avoid flooding, and new ways of doing doing weather management on the individual sites, because every single asset is going to deal with this going forward. 

 

ML 

Okay, so I'm going to challenge you on a couple of things. I mean, first of all, that the situation in Texas was so extraordinary, because the weather there didn't shift that was not a climate related situation, because it had been as cold as that in, you know, periodically, you know, on a decadal basis, this was not even that extraordinary of a weather situation, as I understand it. But in your answer, you've sort of hinted that you think that the big resilience challenge is going to come from changes in climate, and indeed they will. However, what we've also talked about is you're talking about electrifying everything. And then very high proportions of variable renewables, which are, there's a clue in the name, variable. And so that puts us much more on resilience, does it not? Does it is that not a sort of something that you control as an industry, you are also increasing the need and the urgency for resilience? 

 

KR 

I think it's really a matter of how you define resilience. For me, resilience is having a system that is able to run under, you know, or you know, deal with a big amount of stress. And we mainly talk about digital resilience, which is about the cyber threats and the extreme weather. The variability of renewables, is from slightly different questions about operating the system in a different way. It's about adding storage. It's about connecting more with a new sector. It's about providing, you know, being better at add value and flexibility and those kinds of things. For me, that's an inherent sort of task in, in transitioning the electricity system to a carbon neutral one, regardless of the fact that we were dealing with these new and very radical threats, cyber and extreme weather, so for me to sign the different buckets. 

 

ML 

Let me ask you, you know, Europe, obviously, Southern Europe, lots of solar, mainly on a daily cycle that's got one set of challenge Northern Europe, it's all about wind, onshore, and offshore. Solar is great in the summer. But if we do electrify heating, the big peaks are going to be in the winter. Roll forwards, you know, if you go to 2040. And you know, you mentioned a number of 80% renewables, that's going to be an enormous amount of wind correlating and potentially dropping out for two weeks. Batteries are not going to cut it, demand response is not going to cut it. What are we going to do? 

 

KR 

We're going to need a backup fleet, frankly, for any foreseeable future, and we're going to need firmness and firm plans. That's the harsh reality that we have to face and also be a bit honest about because it's, it's great. And it's very convenient and uncomfortable to be talking about what everybody loves, which is renewables. The truth is that the renewable system will need a backup fleet to rely on and some firm capacity. And one of the challenges going forward is that, that we need to ensure business case for both. It's very clear that we want the clean electricity to, you know, and renewables to dispatch first, because it's cheap, zero fuel costs, and so on and so forth. We know the story is also clear that we need those other assets. So how do we create a business case for those because they're going to run less? They're going to be in backup mode? And how are we going to create a business case for that? I think that's really sort of a question that remains unanswered from the political system. And, and one that will become increasingly apparent pertinent as we move to bigger shares of renewables. 

 

ML 

Kristian, just one question, when you say 60% will be electricity, what do you think the other 40% will be? 

 

KR 

So I think it's important to say think, first of all, because it's this is by 2050. But the basic reasoning here is that there's going to be some other stuff around. First of all, you know, if we take it sector by sector, heating is going to electrify much more, but there's probably going to be another, you know, some other stuff around as well. Different types of fuels, fuelling a combined heat and power plant that could be a biomass, for example. So that's, that's one example. Probably, you're going to have diversity, to some extent, also fuels in transport. There's a big discussion we haven't had about maritime transport, what are we going to basically power those ships with? This can be derivatives of hydrogen, this, this could be ammonia, some people are talking about that. But frankly, speaking, there's a big question mark over, then if we look at the other sort of difficult segments of the transport sector, how are we going to fly, you know, short haul might be to some extent electric, probably, we're also going to look at a diversity of fuels in the aviation space. And, and then moving on to the heavy trucks again, I as your Eurelectric believe that, that we should, we should focus our minds on electrification here. But honestly, speaking, we also need to, to, you know, have a certain openness to hydrogen playing a role and then potentially, also biofuels for the heavy trucks. So the, you know, to make a long story short, we're gonna have other stuff around also in the long term, because even if we want to, there are certain use cases that we can't really electrify and heavy industry also provides a few of those examples. Steel, you can electrify but most likely part of it is going to be run with hydrogen. Same goes for many of the industrial processes in chemicals. Cement another one. So, you know, it's going to be a diversity of different things, but the notion that it would be 60% electric and then 40% hydrogen, I don't buy into that at all. 

 

ML 

Okay, and you use the word that I was sort of fishing for that which was biomass and biomass and biogas will certainly still be around and playing an important role. 

 

KR 

Absolutely. So. So one of the questions that we're beginning to look more at is the transition of the gas sector because it's, it's such a significant part of the energy system in Europe, frankly. And if we take the net zero, seriously, the amount of natural gas needs to decline to almost nothing. You can imagine that you can have parts left for industry, for instance, with CCS for power production, potentially with CCS, even if it's very expensive. But biogas is going to be the type of gas that we still can use. And, and I think the kinds of figures I've seen was, was around 100 PCM, as technical potential for gas. So that would be around a fourth of what we have of gas production today, or gas consumption rather. But, that still is, you know, a significant portion of energy that can be used for different purposes. 

 

ML 

I think that's spot on. I think that those backup plants, you know, it could be that that's a fantastic use of the hydrogen that we're not going to be used in cars and in heating, but they could well be hydrogen, but and that, by the way, doesn't even drive the cost up on average, because most of the time you use very cheap renewables. So if you have five or 10% of the time using expensive backup plans, you smear it across the year, and it just doesn't, it doesn't matter very much. But it's going to be a political decision to invest in that resilience is gonna come from the industry players, they would never get, you know, the market, as we've seen in Texas doesn't give the returns. I want to just finish off with COP26. I mean, 78% of the global economy is led by, you know, the leaders have said they're gonna go to net zero in 2015, or 2016. Is COP26 going to be a huge celebration, or are you still with your former hat as a somewhat bruised, aficionado of COPs going back to Copenhagen? Are you going to be out there on the barricades demanding they still need to deal with this? and that and the other? Or can we sort of declare victory at COP 20 at COP 26 in Glasgow? 

KR 

You know, the COPs are they're a funny animal, you know, I remember as a young bureaucrat, you know, that the ultimate prize was to go to the COP and then you would just be part of all the people declaring victory over whatever exactly, there was to declare victory over I think almost every cop in the in the entire history has been a huge success, if you ask the organisers perhaps COP15, in Copenhagen, but, but even though the Prime Minister did insist that it was a significant success, as soon as the dust had settled, but you know, the I've had a lot of thoughts about this international process, because it is painstakingly slow. And you know, you see those 10s of 1000s of people travelling around the world now to Cancun, now to Durban, and now to what wherever, and outcomes, this completely unreadable text of a few pages, or 30 pages, and there's just no way in this world that you're able to read through it. And yet, that's a great success. So I've often had that, you know, in the dark moment, where's the value of that process? And what is it actually yielding? What this process really does is it produces a continued momentum and the discussion about the direction, the Paris Agreement is indisputably a fantastic result that has focused the minds of the entire world on this task. The net zero is now established, pretty much in any major economy across the world. And regardless of the fact that, you know, there's nothing about how it's going to be implemented or who's going to do it and, and, and what if you don't and all this, it really has a huge political value, focusing the mindsets of policymakers across the world, and also providing a direction for business to say, Okay, let's do this and, and every year despite the fact that it can feel like a circus, and it can feel, you know, quite unclear what's actually gonna go on and what's actually going to be decided, every single year, every single regulatory department in every single major company is asking themselves the question, what are we going to tell the COP this year? What are we, you know, how are we delivering? What's our success stories? What's our plan? And how are we? How are we, you know, how are our results stacking up, and that has a value. And so despite all this, you know, fuzziness and confusion around the cups. It has a value. 

 

ML 

Very good. And final question COP 26. in Glasgow, are you going to be there? 

 

KR 

Well, COVID will tell right. I mean, we have plans, we're working with some of the biggest companies in England and with our UK Association member, as well, to find out, you know what are the good stories to tell, as I said, you know, how are we progressing as a sector? What are we delivering? are we are we living up to our own promises and ambitions to become net zero. And, and the great thing is, you know, even if time is running out, there's so much positive development to report on the offshore adventures, just a fascinating one, you know, with turban sizes, growing with an enormous ambition level and new infrastructures coming around. So there's this really a plethora of fantastic stories to tell. And right now we're zooming in on what those three are that we actually have time, time for, and we can find agreement on. 

 

ML 

Very good. Well, let's hope that this ghastly pandemic has receded sufficiently by November, it is whatever it is about eight months away. So hopefully, that will have you know, we will be able to actually travel, and hopefully, you and I will be able to meet and have not just a virtual cup of tea and a glass of Heineken, but actually a real cup of tea and a real Heineken, or, or indeed a glass of champagne, if we're listening to Claude Durham's version of events, and hopefully be able to do that, or actually, do you know what? A whiskey given that it's going to be in Scotland? It's been a great pleasure. Thank you so much for joining us here on Cleaning Up. 

 

KR 

Absolutely. It was my pleasure. 

 

ML 

So that was Kristian Ruby, Secretary General of Eurelectric explaining how he attempts to help all his over 3000 members towards the two great challenges of our time, which is making electricity net zero and trying to electrify if not everything, then as much as possible. My guest next week is Kate Hampton. She's Chief Executive Officer of The Children's Investment Fund Foundation, and a longtime expert in sustainable finance and the carbon markets. Please join me at this time next week for conversation with Kate Hampton.