Electricity house of the year: ENGIE

Energy Risk Asia Awards 2021

ERAA21-Winner-web

ENGIE has been rewarded for its pioneering work as a green energy provider, growing amid the deregulation of electricity markets across Asia-Pacific (Apac). The region’s largest independent power producer, ENGIE is committed to expanding its footprint as an electricity house with a series of hard-fought wins

Varun Gujral, ENGIE
Varun Gujral, ENGIE

Varun Gujral, co-chief executive for Apac at ENGIE’s Global Energy Management Solutions (GEM), says, “We are proud Energy Risk recognises our commitment to bringing liquidity and transparency, and our modest participation in the successful liberalisation of Asian power markets. Our commitment goes beyond market activities – through GEM, we are expanding our offering in Apac for green power solutions for our clients in their decarbonisation strategies. Such solutions cover green power purchase agreements (PPAs) and renewable energy certificates (RECs) across the region.

“And that’s what made the difference. We are also not limiting ourselves to one country – we are active in developing markets and are keenly watching other emerging markets. We have activities in Australia, New Zealand and Singapore, and were pioneers in Japan’s ongoing electricity market deregulation.”

Japan deregulated its electricity market in 2016, paving the way for private providers such as ENGIE. When the European Energy Exchange launched Japanese power futures in May 2020, ENGIE was the first to trade with Tohoku EPCO Energy Trading through its Singapore-based power desk. Already active in other liberalised Apac power markets, ENGIE now brings additional liquidity to Japan where it is a top five liquidity provider on the EEX, despite not being a physical player in the country.

ENGIE has differentiated itself from its competitors by establishing itself as a partner of choice for companies wanting to decarbonise their business. According to BloombergNEF, the strategic analyst for the energy transition, ENGIE is the number one clean energy developer for 2021 in terms of volumes sold to businesses through green corporate PPAs.

The French utility is further developing its energy management platform in Melbourne to support Australia’s policy shift to low-carbon solutions. Australia is a key market, and ENGIE will continue to develop existing solutions, provide risk management services and financial products, and manage the current 1 gigawatt (GW) installed capacity of gas-fired power plants and combined cycle gas turbines in South Australia, as well as 0.2GW of renewables capacity and the upcoming 0.5GW of renewable assets in the pipeline.

Matthias Soreau, ENGIE
Matthias Soreau, ENGIE

The utility’s winning strategy is to combine its deep understanding of energy commodities such as electricity with the risk management expertise of its Singapore trading platform. This is what makes ENGIE stand out from its competitors for this award, says Matthias Soreau, head of power and gas trading for Apac.

He says: “We are right now integrating our teams between Singapore and Australia to be more lean and active in this area. What we have that others lack is a strong, global footprint in commodities since we are active in close to all liberalised electricity markets globally. Our commitment goes beyond market-making – we offer green power solutions to clients in their decarbonisation strategies.”

A growing number of corporates have committed to reduce their emissions and have opted for green energy, such as electricity from renewables, and demand is picking up outside of Australia. ENGIE is starting to actively market green solutions in other Asian countries, showing large potential and concrete interests from global corporates committed to green power and/or carbon neutrality.

As an example, ENGIE has been helping a client achieve 100% green power supply across six Apac countries using a multi-country REC deal. This win was on the back of a green power supply agreement signed with the same client the previous year for Australia. The utility is finding success with its corporate green power purchase agreements and RECs, plus other environmental products.

Combatting greenwashing is high on the company’s agenda with its in-house, blockchain-based platform, The Energy Origin (TEO), which provides real-time, tamper-proof confirmation of how much green energy is produced by its assets while matching its clients’ consumption. This brings traceability and transparency, while also expanding the capabilities of supply-demand matching between renewable energy producers and corporate buyers, explains Pierre-Alexandre Deplaix, originator in green solutions for Apac at ENGIE GEM.

Deplaix says: “Our clients can use TEO as a means to further ‘green up’ their consumption. The solution enables them to select, trace and authenticate energy sourcing in real time, with direct access to the associated RECs. Pursuant to our agreement with key clients in Apac to support their carbon neutralisation strategies, we continued to develop the reach of TEO to integrate it to our offers in APAC. Indeed, these markets are seen by clients as requiring higher need of traceability and transparency on carbon-neutral solutions.”

The company practises what it preaches. In line with accelerating the transition to a carbon-neutral economy, ENGIE lowered its own carbon footprint and developed renewable energy worldwide with large-scale investments, notably securing a 9GW renewable capacity commissioning target for 2019–21. The group has expanded its portfolio of renewable assets year-on-year since 2019, adding 3.3GW in 2020 – an achievement considering the challenges faced by the industry throughout the year.

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