Siemens Energy Solutions has operated since January, working with universities and factories to make custom energy supply systems. Bowser told us how energy-technology-as-a-service is the most attractive area of the market at the moment, and why now is the time for it to expand.
Matt Farmer (MF): You’ve been at Siemens for almost 17 years. In that time, how have you seen people’s approach to and understanding of the energy transition change?
Faye Bowser (FB): That’s over half my life I spent with Siemens, and obviously it’s been a joy. Over the 17 years there seems to have been a tipping point, where now it’s really being grasped that we are facing this climate and ecological crisis; that we have to face the emergency that’s here on our doorstep.
So I think what we’ve seen from a lot of larger organizations, is it has really shifted from a topic that we talk about the need for it, to actually something that’s mandated, something that people are incentivised by, and for the UK something that’s legislated. We have to get to carbon neutral by 2050. So it’s not a case anymore of ‘Should we, shouldn’t we, how do we debate?’, it’s ‘This has to be done, so how do we all put everything behind getting us to that point?’.
There’s a lot of projects that we have behind us that do help to decarbonise. So let’s not do that project by project. Make it a whole industry, do it at scale. So what we’ve been talking around is how you actually change that from an evolution more into a revolution. It has got to be done on a grander scale.
MF: How do you envisage companies taking a more active role?
FB: We’re saying take an active role by really setting ambitious and strategic objectives. We can use our own company [Siemens] as an example. For the UK, we know it’s legislated to be carbon neutral by 2050. But we’ve said that we want to be a carbon neutral manufacturer by 2030, and we’ve already reduced our emissions by over 50%. So we’re looking for companies that set those kinds of ambitious targets.
There is no silver bullet. There’s no one piece of technology, there’s no one large organisation that’s going to solve all of this; it’s a complex problem. I think what we’re looking for is companies that are willing to be ambitious.
What we want to make clear is I wasn’t saying they have to look to invest in this, because actually, I think the energy industry is quite behind in some ways, in terms of looking at service models.
We’ve seen service models change the way we listen to music, the way that we shop, the way that we’re buying our foods, and the way that we’re traveling. We provide a service model for our customers that provides the outcome that they’re looking for, and we see that as being a benefit for them. As a company, we’re willing to design, build, own, operate, and maintain these assets and provide the customer the outcome, so they wouldn’t necessarily have to invest.
MF: You’ve already worked with several clients, such as Keele University. Personally, I was surprised to see universities among your first clients.
FB: We look at energy intensive users, and you’d be surprised. The university footprint across the UK is over 164 different campuses. A lot of that is existing infrastructure where there’s a lot of untapped opportunity to improve things like efficiency, and also improve their student experience as well.
One thing that we did recently is we developed an energy roadmap with the University of East London. We demonstrated to them how they can eliminate their carbon by 2030, and the solution that we developed went through three steps.
One is to see: how can you use less, and how can you use more efficiently? So that’s a lot around the demand side, things like lighting interventions, things like building management controls.
Then once you’ve optimized your energy usage, what can you produce on site? They’ve got an opportunity there around things like solar panels on the roof, and you could use things like water source heat pumps.
And finally, how do you turn that university into a whole sort of living lab, learning from the solutions? So we worked through these three steps and said, actually, within the first year, the solution we deliver could reduce your carbon emissions by about 25%.
MF: What sort of technologies do efficiency savings, like the ones at your own factory, involve?
FB: We talk about saving energy and using energy more efficiently; they are the two main factors to create a more sustainable future. Those are achieved by integrating energy-saving products into the buildings.
They can be a combination of measures, like upgrading your lighting system and making sure that there’s sensors installed and integrated, so that the asset actually starts to be more automated.
And there’s a lot around sort of human behaviour. Everybody must have had, at some point, their parents telling them to turn the lights off. And you see that and wonder how much that is costing us in terms of energy across the whole of the UK. But we’ve come a long way from there, there’s LED lighting, there’s automations…
And then looking at the building management system, which is like the brain of the building. Get it all optimized, get everyone in different parts of the building. If you have all of those kinds of sensors, you can do up to around 30% less maintenance, you get about 45% less downtime, and use 30% less energy. So there’s lots of benefits of having that internet of things sort of approach.
MF: Would you go beyond Siemens to get in technologies as you see fit?
FB: Yeah, because even though we have a lot of best-in-class technologies, you may find instances where there’s a gap in our portfolio. We know we can do a lot with our capabilities, but we’re not arrogant enough to say: ‘We are the be all and end all.’ A lot of the energy intensive users, what they’re buying is that trusted partnership. We’ve been around for 170 years, we understand what it takes to design technology, to install it, to service it.
There will never be just one option, and I think if you go in with one standalone, single-asset offer, then the customers know that what you’re trying to sell them. What we sell for our service model is savings. We will provide a savings contract, we will guarantee those savings and we will design the best system that delivers that savings. As a company, we have a very broad portfolio within Siemens, which has given us a lot of the expertise there.
MF: Are there any particular things that you’ve learned from the clients you’ve taken on since January?
FB: We have this short-term emergency with the pandemic, but we also have a long-term emergency and we can’t let things slow down. So for example, the opportunity in existing assets like buildings. At the moment, a lot of the buildings are not used much. For universities, they found that although they don’t have people on site and occupying the buildings, their energy demand is only reduced by about 30%. If people aren’t in there, why is that building still consuming about 70% of the energy? It makes it really plain as day, the opportunity there to actually look at optimizing those existing assets.
I mean, we’ve already helped our customers globally avoid over £3bn worth of utility costs. And so we’ve got a lot of that work still guaranteed up to 2040. We’ve put a lot of focus into creating our digital tool chain, so that a lot of the design, a lot of the simulation, a lot of the choices that you’re making are based on previous performance. It’s a business that we are investing in and that we do expect to keep expanding, because it is the most attractive part of the market right now.