That quote might be 75 years old, but it feels particularly relevant today while we’re in the middle of a technological shift the likes of which we’ve never seen before. The only way large energy players like E.ON will stay on top of this shift is by working in partnership with others.
A roaring lion
I’m always astonished by how fast tech giants and startups come up with new products and solutions – often to problems we didn’t even know we had!
Some of those solutions are forcing entire industries to reorganise themselves. Exciting stuff – but I’d be lying if I didn’t occasionally worry about how this might affect E.ON and whether we’re strong enough to take on those changes.
If you look at the numbers, you’ll appreciate my concern. E.ON is one of the largest energy suppliers in Europe – with 32 million electricity customers and another 13 million relying on us for gas distribution.
We manage around 1.4 million kilometres of the energy network, along with 149,000 kilometres of the gas network. We also look after 9,000 kilometres of water infrastructure and 130,000 high-voltage power pylons, while operating the second-largest charging infrastructure network on the continent.
The majority (78%) of our revenue (around 41.5 billion 2019) comes from the regulated grid business, so describing E.ON as the roaring lion of utility infrastructure, might be an understatement!
The infrastructure challenge
Those vast assets can be a serious burden when it comes to rolling out new products and technologies – especially now that the sector is shifting towards a decentralised grid. We know that to survive, E.ON needs to change the ‘raison d'être’ of its existing infrastructure and give it a makeover.
Indeed, as we move closer towards decentralised renewables, optimisation and novel asset ownership structures, E.ON continues to look for growth outside of its regulatory business too. As the lion seeks to make its market position even more secure, we won’t shy away from new revenue streams, cost savings and products.
But navel-gazing alone won’t provide the answers. That’s why we’re putting so much effort into fostering global partnerships. We even set up our own Innovation Platform to help us evaluate the newest energy developments and connect with innovative companies, universities, thought leaders and startups from all over the world.
I’d go as far as saying that without these insights from our partners, we’d fast become irrelevant – unable to keep up with future challenges. Indeed, take away that nurturing ‘den’ and this roaring lion would almost certainly go hungry in the ever-changing energy savannah.
A shift in energy distribution
The recent mega-developments in connectivity, urbanisation, demographics – and even COVID-19 – are seriously impacting the way we live and work, not to mention how we produce and consume energy.
At the same time, traditional boundaries between industries are getting more blurred, with demand for customised user experiences forcing the energy sector to converge towards other areas like automobile, banking, telecoms, property tech, etc.
You’ve probably heard of the ‘Internet of Things’ (IoT). When people ask me what the IoT is about, I suggest they imagine their toaster mining Bitcoins to pay off its gambling debts to their fridge.
To be clear, I’m not suggesting your toaster is quietly planning world domination while browning your sourdough – at least, not yet. But the fact that internet money is being powered by energy should give you an idea of the seismic shift in connectivity I’m talking about.
I predict that in the coming years, we’ll see smart ‘organisms’ become commonplace in our work and living environments. Those organism will be able to deal independently with their own energy management and energy purchase agreements. Interconnectivity, improved analytics, internet-native money, distributed ledger technology, and serverless computing will soon transform electronics into an entirely new type of energy customer.
Here at E.ON, we want to be ahead of the curve. We’re already testing our huge arsenal of physical assets with technologies like AI, Robotics, IoT, Blockchain, 5G and Quantum Computing. It’s challenging work that we can’t do on our own, but I’m excited to see where it takes us.
Eco-systems – Shifting from ‘make-or-buy’ to collaboration
The energy sector can’t afford to sit on its hands and watch those transformations from the side-lines. Here at E.ON, we want to be at the steering wheel – or at least in the co-pilot seat.
That said, we still have more work to do when it comes to shifting our own corporate mindset. We need to replace our old 'make-or-buy' thinking – where we choose between producing internally or buying externally – to one where 'collaboration' is a viable third choice.
From being a somewhat insular and lone lion, E.ON is making partnership-thinking the norm. We’re pulling together whichever technologies, apps, software platforms and services needed to help us provide customers with the most integrated solutions.
This approach has been a steep learning curve, but will lead to a reduced risk-return ratio. Ultimately, with partners at eye-level and sharing costs, we’ll be able to reduce our risk-return ratio, while accessing additional value pools – and without investing into an additional asset base.
We’re getting very good at creating eco-systems. We’re building a community of partners – each bringing different capabilities and technologies in areas like connectivity, energy, mobility, banking, sustainability and urbanisation. Indeed, we’re taking our ego out of the equation by turning the belief that ‘what we do ourselves, we do best’ on its head.
These eco-systems are a win-win. They allow E.ON to lead the energy and technological transition while at the same time supporting innovative tech giants and start-ups in accelerating jointly created products and bringing them to market.
What does that look like in practice?
E.ON can only stay relevant if it continues to cover its technology gaps, expands into new markets and modernises its corporate culture.
We need to stay proactive at doing this. That’s why we’re firmly tracking trends via our innovation offices in Tel Aviv and Silicon Valley. My team and I support regular match-making events as a way to build closer links between E.ON and the rising stars in innovation.
Some of those partnerships are already bearing fruit. Take Lemonbeat, for example, an operating system for IoT devices that solves complex connectivity problems. Or gridX – a solution that ensures efficient and dynamic load management of charging stations for electric vehicles. We’ve also teamed up with Heliatek, a Dresden-based company that manufactures the world’s first fully-organic photovoltaic film.
Meanwhile, our partnership with EWF (the Energy Web Foundation) has helped us gain valuable know-how about Blockchain technology and future market design for our existing business. And let’s not forget our significant water and pole tower infrastructure. We’re confident that working in partnerships will unlock substantial growth opportunities when it comes to water technologies or linking our tower infrastructure with the roll-out of 5G.
I also predict further opportunities as a result of ongoing changes to feed-in tariffs across Europe. Perhaps a little more leftfield, but the prospect of combining decentralised green electricity generation with autonomous farm machines also deserves an honourable mention.
Frankly, I can’t think of a more exciting time to be involved in energy technology and transition.
The energy world is changing beyond recognition. Without the innovative know-how of our partners, E.ON would probably starve.
That’s why I’m stoked about the number of promising companies, start-ups and innovators E.ON is already connecting with. Without their input, we would have been much slower in our response to the shifts in customer interaction, peer-to-peer energy trading and the markets.
But our mission to find more opportunities to collaborate continues. We want to keep exploring areas on the technology map where we can collaborate with the best partners to build the energy system of the future.
I’m looking forward to making our lion’s den even more effective at increasing its future territory.
You might also like
Subscribe to our newsletter
Join the community of innovators and stay up to date on the latest news about the future of energy.