In a world of volatile energy prices, uncertain sources of new energy supply, aggressive investor involvement, and intense regulatory scrutiny, fundamental changes are occurring within the power and gas industry. With historically high oil and gas prices driving the price of marginal power production, governments are seeking non-carbon based power sources and increasingly looking to alternative or cleaner energy sources, including nuclear, liquefied natural gas (LNG), and coal gasification. In Europe, Germany and UK are considered to be the most advanced when it comes to Energy & Utilities Industry.
For decades Germany has been the global pioneer in applying renewable energies and environmental technologies. The new energy concept continues this path with ambitious goals to cut CO2 emissions by 80% and increase the share of renewable energies at total energy consumption to 60% by 2050. Investments into offshore wind, photovoltaic, geothermal and bioenergy projects will be necessary as well as the set-up of a new, smart energy infrastructure that can balance the fluctuating supply of renewably energies. Furthermore energy, water and resource efficiency technologies will play an even more important role.
In the UK energy in the form of Gas and Electricity is transferred and distributed to businesses and homes by a number of private businesses. Between them they use 289,000Km of gas pipes – enough to circle the world six times and 800,000Km of Electricity lines and cables, sufficient to connect to the moon – twice.
Energy Networks and the UKs low carbon commitment
The UK has a commitment to reduce greenhouse gas emissions by 80% by 2050, relative to 1990 levels. In that context, the challenges for Energy Networks are:The UK is currently highly dependent on gas for power generation and domestic use. As the UK moves towards lower carbon energy sources the Gas infrastructure will need to be updated.
Low carbon energy sources can be in locations away from existing distribution opening opportunities for Investment in new distribution systems. As levels of renewable generation are brought on line new challenges matching supply to demand will need to be met. This will call for innovation and investment to manage unpredictable generation and supply and demand. Solutions in storage, Demand side control, smart grids and management of suitable large sources of demand that can be controlled.
Smart Energy Systems
The new area of smart energy systems – smart grids and smart meters are in the demonstration phase in the UK and will move into deployment over the next two years. It is likely to involve a very wide range of companies, many of which may not be involved in the UK energy supply chain today.
Heavy Electrical connection
Currently the UK is served by Siemens, ABB and Alstom/Schneider. And new participants are arriving such as Mitsubishi Electric as the new demands for cabling transformers and distribution equipment arise.
Alternative energy sources, such as renewables and biofuels, have become a cause celebre with both environmentalists and industry executives. And with this evolving market backdrop, regulators are insisting on flawless energy delivery and stability in prices, while exercising close control over industry consolidation. As market forces continue to create challenges, distinctive strategy, business model evolution, financial capacity, regulatory innovation, and world class operations capabilities become table stakes for success.
Drawing on a deep understanding of industry dynamics, extensive experience along the entire gas and power value chains, and broad functional capabilities,UK Enterprise Consultants assists many of the world’s leading companies in the gas and power sectors. Our global capabilities are delivered throughout the sector to traditional utilities, merchants, and marketers, as well as to financial sponsors, vendors and suppliers, and governments. Working side by side with our private and public sector clients, we assist with strategy development and execution, M&A transaction support, performance management, and technology strategy and implementation.
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