A MILESTONE FOR THE ENERGY REVOLUTION

When I look back over 2018, the first images that come to mind demonstrate the detrimental effects of climate change and the difficulty, despite the warnings, of changing the model. There are images of devastating fires in California, which have already claimed dozens of victims with thousands of people missing. Images of serious heat waves in Japan and Europe last summer and of record flooding in India. There are also images demonstrating climate change scepticism, which is currently in vogue, as several governments are openly moving away from the Paris agreement. Or of the dissatisfaction felt by some groups of people who are worried about the effects of this ecological transition on their purchasing power and on their standard of living.

The year 2018 also saw the energy revolution reach a new milestone. If we just take the time to look for them, there are plenty of encouraging signs.

This year, installed capacity from solar and wind power exceeded 1 TW worldwide – the equivalent of 1,000 nuclear reactors. Germany launched its first hydrogen train. Sales of electric vehicles in Europe were up 42% in the first half of the year compared with 2017. The mayors of 19 major cities (London, Copenhagen, Johannesburg, Montreal, Toronto, Vancouver, Paris, Los Angeles, New York and Tokyo, amongst others) pledged to make all buildings net zero carbon by 2050.

This is not just about figures or large aggregated and abstract numbers. It is above all about actual progress being made on the ground. Personally, since I travel a lot in Europe and beyond, I have been able to see for myself some of these new projects, which are capable of radically transforming the environment and living conditions of local inhabitants. I have met men and women who are fully committed to making ecological transition a reality. In Lommel, we are building the largest solar park in Benelux. In Zeebrugge, we have joined forces with GreenPorts to study the conversion of electricity produced by off-shore wind farms in the North Sea into hydrogen. In Namur, we are working on an ambitious mobility project. I also witnessed the milestone this year when I opened solar parks in India and Chile, the first power-to-gas demonstrator, which will produce renewable hydrogen in Dunkirk, and a biowaste methanisation unit in the Centre-Val de Loire region of France.

The desire for a change of model

More than just an industrial transformation, this is also about a change in society. Citizens’ expectations are getting higher and higher. In Belgium, 75,000 people took part in a climate protest in the streets of Brussels on 2 December. In France, more than 20,000 students have signed the manifesto for a “wake-up call on the environment”, in which they pledge not to work for companies that are insensitive to climate change and environmental issues. A group of YouTubers has launched the #OnEstPret (we are ready) campaign, in which they take up challenges to reduce pollution and share good practices with other people. Millennials say they would invest more in socially responsible funds, even if they underperform.

In response to an economic growth model that has, until now, prevailed at the expense of the planet, there is a profound desire to change this model, to pay more heed to the social, societal and environmental issues involved in economic activity, and to prioritise goods and services that reconcile the common good with individual interests. I often say that a company that does not know how to adapt to this change of mindset is quite simply doomed to failure.

These demands go beyond Corporate Social Responsibility (CSR) policies, no matter how ambitious these may be. Citizens expect companies to place CSR at the very heart of their business, not to put it to one side like an ornament to attract attention.

Large businesses are starting to apply CSR requirements to all their offers and operations. Ikea, for example, announced in April that it aims to become a fully circular business by 2030. After this date, the company will use only renewable energy and recycled materials.

The social value of businesses

In the energy sector, this change has already produced some powerful effects. It has resulted in massive public support for renewable energy and the rapid maturing process of these energy sources. I am convinced that the move towards a zero-carbon world is irreversible. And that’s why, here at Engie, we wanted to position ourselves at the forefront of this development. The transformation plan we implemented between 2016 and 2018 allowed us to focus on activities that are in line with this new world. We have chosen to opt out of coal – since 2015, we have reduced our electricity production capacities from coal by two thirds. We are continuing to develop our renewable energy capacity: in Belgium, we are already the country’s leading producer of renewable electricity. We are helping our customers to optimise their energy consumption and improve their comfort. In Liège, for example, we deploy Engie Cofely solutions in 40 school buildings to improve energy efficiency. And in Knokke, we use 60 IoT sensors (sensors connected to the internet) to give us an overall view of traffic in real time, optimise waste collection and control noise, air quality and water levels.

In future, businesses will be expected to demonstrate their social value and stay in tune with the new expectations of citizens.

They will have to become even more aware of their environment and their customers’ needs, and be able to recognise fundamental trends. It is this desire that led to the major internal and external consultation, Imagine 2030, which we carried out at Engie this year. We asked our employees to compile society’s key developments and expectations and to reproduce them on a large-scale digital platform, which will be the basis of discussion. The results should allow us to identity the major economic, social and demographic trends that will shape the world in 2030 and, as a result, define the group’s strategy.

2018 was a pivotal year, marking a turning point in this new world. A world in which economic and social demands must be reconciled and in which businesses must put social value on an equal footing with profitability. Companies must also ensure they listen to society and, in so doing, help make progress more harmonious.