Vlerick Expertise in Energy

Enedis, a subsidiary of EDF, is in charge of the last mile in the delivery of electricity to most of France. This case study follows the start and development of Enedis' digital transformation, with the ambition to be at the forefront of the energy sector in the digital age.

Distribution system operators are facing a radical digital transformation of their business model. They could go from purely managing the physical infrastructure to acting as data hubs or neutral distributors of energy data as well. Are we on the verge of an ‘Uberisation’ of the energy sector? Stijn Viaene, Professor at Vlerick Business School, believes we are.

This teaching case describes the current challenges of the energy market, especially focusing on DSOs (Distribution System Operator) such as Eandis.

Energy and electricity are usually associated with the colour green. Not so for professor Leonardo Meeus: “Today, grey is the colour. Not a boring grey though. An exciting grey”. Twenty years ago, almost the entire energy value chain was in the hands of a single player. Nowadays there are different bodies responsible for different areas. In the sidelines of the distribution system, a myriad of new activities have sprung up which are not regulated at a national or EU level.

There are many uncertainties that might determine the future of the energy industry in general and the landscape of network operation in particular. According to the Vlerick Energy Centre together with a team of European industry leaders two of these uncertainties call for deeper analysis as they are more relevant and most likely game changers for the power grid industry: consumer involvement and decentralised generation. Depending on the level of consumer involvement in energy choices and the amount of decentralisation of the energy resources four scenarios were developed on how the energy market in Europe could look like in 2030.

A recent survey by the Vlerick Energy Centre in close collaboration with KPMG on the future of Distribution System Operators (DSOs) shows that top executives from Distribution System Operators across Europe expect significant changes in their role and business environment. Vlerick Energy Centre Chairman, Daniel Dobbeni, explains: “Decentralised and renewable electricity generation as well as customers becoming rapidly both consumers and self-suppliers will change the power sector like never before. To keep the lights on, the industry actors must quickly acquire new knowledge and confront their experiences.”

Offshore wind technology is increasingly being used to meet the renewable energy ambitions. According to the National Renewable Energy Action Plans submitted by EU member states in 2011, the installed capacity of offshore wind farms in the EU was expected to increase from 3 GW to 40 GW by 2020. Which type of regulatory framework is the best to support this expansion of offshore wind power? That is the question Leonardo Meeus, Associate Professor of Energy Markets at Vlerick and Director of the Energy Centre, set out to answer.

The recent publication of a research paper entitled “The Impact of Supply Chain Resilience on the Business Case for Smart Meter Installation” was a new milestone in the Chair Partnership with Flemish gas and power distributor Eandis. What started off as a proof of concept among 4,000 households having a smart meter installed has grown into a challenging big data venture with information no-one has ever had before.

What is the impact of the regulatory framework for transmission investments on the cost of renewable energy in the EU? Under the current regulatory framework transmission investment planning is mainly done at a national level. This may result in suboptimal transmission investments, i.e. maximising national rather than European welfare, as cross-border projects initiated by one member can be vetoed or delayed by the other member states involved. However, investments in transmission infrastructure are important to enable cross-border renewable energy trade. Why? Because such trade would help reduce the costs of achieving the national targets for renewable energy. So, the question is whether the current imperfect regulatory framework is actually a problem?

They may be eco-friendly, but clean tech companies confront hostile markets. In order to prevail, they will need to attract customers prepared to pay more for a green product, perform better than competitors, or change the rules of the game.