“If you have a low carbon power mix, regardless of what sources are used, it's a good idea to electrify”: Kristian Ruby on the green potential of electrification.
In this episode of Cleaning Up, Michael Liebreich is joined by Kristian Ruby, Secretary General of Eurelectric. Kristian represents the European electricity industry to politicians and policy makers.
Below is an abridged transcript of the conversation, edited for clarity.
Michael Liebriech: Kristian, welcome to Cleaning Up. Can you tell us about Eurelectric?
Kristian Ruby: We represent the electricity industry to policymakers, mainly in Brussels. That means we develop business intelligence analysis, we present it at big events, we talk to policymakers and come up with recommendations, and we try to coordinate positions across the industry. The policymakers know, not only what our association is, but what could fly with the entire industry. It's a big one, we have around 3500 companies in Europe and they account for an overall turnover of some €700 billion.
ML: I saw Eurelectric as being essentially an association of companies that, frankly, would rather there was no transition to renewables, or at least that was the position in the past. What are the politics of Eurelectric?
KR: I think we need to remember that companies who operate electrical systems have customers who get in a bad mood if the electricity stops flowing. Currently, we’re seeing the mess in Texas, which shows just how serious it is when the power is suddenly gone. So, there needs to be, perhaps, a certain level of conservatism that wants to change but also wants to ensure power continues to flow. Otherwise, we could be in real trouble. That may be part of that conservatism you're talking about.
ML: I think that one of the campaign directions you have taken has been around electrification of everything. Electrify transport and electrify heat, for example. How did you come to adopt electrification as a mandate?
KR: When I arrived, we had to sharpen our commitment to clean energy. But thinking about how that was going to happen in practice was less prevalent in the advocacy of Eurelectric, which was focusing at the time more on establishing a proper market security supply, both of which are super important things. However, when I wanted to double-down on that commitment. So, we involved all the CEOs and decided to put it as clearly as possible on one piece of paper: what we're going to do and why we believe electrification is really a huge opportunity, not only for us but for society and for citizens. We had a clear involvement process of all the executives in the sector, and we got everybody on board to agree to go for it before mid-century.
ML: 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: Yes, and maybe my contribution was to turn that around. By turning it around and saying that we care about society, suddenly people are like, okay, I'm going to buy something from those guys.
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. We've spent quite a bit of time drilling down to say what exactly we can electrify. Where can we not electrify? We believe that a net-zero economy would require 60% electrification or 60% of total final energy consumption to be electric by 2050.
ML: How do you square the circle of nuclear haters and nuclear lovers amongst your memberships?
KR: I've learned in Eurelectric that we must accept that the energy map of Europe is diverse, and we need to be able to see the benefits of electrification also in contexts that have another composition of the power mix. For example, look at France, they have one of the very lowest emission profiles across Europe. That's because of their nuclear fleet, combined with renewables. As far as I'm concerned, you need to electrify all the cars in France as soon as possible. We have to say, if you have a low carbon power mix, regardless of what sources is actually powering it, it's a good idea to electrify.
ML: Europe has lots of solar, mainly on a daily cycle that's got one set of challenges and Northern Europe is all about wind. Solar is great in the summer. But, if we do electrify heating, the big peaks are going to be in the winter. There is going to be an enormous amount of wind correlating and potentially dropping out for two weeks. Batteries and demand are not going to cut it. What are we going to do?
KR: We're going to need a backup fleet for any foreseeable future, as well as firm plans. That's the harsh reality. It's very convenient 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. One of the challenges going forward is that we need to ensure the business case for both. It's very clear that we want the clean electricity and renewables to dispatch first, because it's cheap and has zero fuel costs, and so on. 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? Are they going to be in backup mode? How are we going to create a business case for that? I think that's really a question that remains unanswered from the political system.
One of the questions that we're beginning to look at more is the transition of the gas sector because it's such a significant part of the energy system in Europe. 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 CTS for power production, potentially with CCS, even if it's very expensive. Biogas is going to be the type of gas that we still can use.
ML: Is COP 26 going to be a huge celebration, or are you still 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? Or can we sort of declare victory at COP 26 in Glasgow?
KR: The COPs are a funny animal. I remember as a young bureaucrat 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 there was to declare victory over. I think almost every COP in history has been a huge success.
The Paris Agreement is indisputably a fantastic result that has focused the minds of the entire world on this task. Net-zero is now established, pretty much in any major economy across the world. And regardless about how it's going to be implemented or who's going to do it, it really has a huge political value, focusing the mindsets of policymakers across the world, it also provides a direction for business to join. Every year, even though it can feel like a circus, every single regulatory department in every single major company is asking themselves the question, what are we going to tell the COP this year? How are we delivering? What are our success stories? What’s our plan? How are our results stacking up? That has value. Despite all this fuzziness and confusion around the COPS, it has a value.