Driving the energy transition

REMI ERIKSEN

Welcome to Trust and transformations - leaders navigating change, a DNV podcast. I'm Rémi Eriksen, DNV’s group president and CEO.

In this series, myself and our business area CEOs sit down with other global leaders to talk about how they tackle transformations, build trust in their business and people, and what they think is coming next for their industry. Right now, they are experiencing a series of historically significant transformations, making trust more important than ever.

This episode is hosted by Ditlev Engel, CEO of Energy Systems at DNV.

DITLEV ENGEL

Hello and welcome to Trust and transformations - leaders navigating change. I'm Ditlev Engel, CEO of Energy Systems at DNV. I'm very pleased to be welcoming Manon van Beek, CEO of TenneT Holding B.V. joining the podcast today.

TenneT is a transmission system operator in the Netherlands and a signifcant part of Germany. They own and operate over 25,000 kilometres of high-vaultage lines and cables delivering electricity to 43 million domestic and business users safely and reliable 24/7 365 days a year. They play a crucial role in maintaining electricity grid infrastructure. Amongst others, Manon’s leadership team is carrying, driving TenneT’s commitment to a sustainable energy future.

So welcome to Trust and transformations - leaders navigating change, Manon. It's a real pleasure to have you with us here today, and maybe should we start by exploring your leadership style in the sector.

So could you, for instance, give us a bit of sense of what it's like to be a leader in the transformation sector, balancing the drive of innovation with the core responsibility of keeping millions of customers supplied with power?  

MANON VAN BEEK

Thanks Ditlev, now a whole mouthful.

Well, I think being a leader in the transmission sector is a privilege. It's intense and it comes with a huge responsibility, which is a nice word by itself because it's also your ability, I think, to respond to very much unstable global geopolitics where we are in which makes that the energy outlook I think it's pretty uncertain. So I think the whole energy transformation, it's a big complex coordination challenge, if you wish, and although I think the technological solutions are there, they are in abundance I would say, also with companies like yours. But at the same time, in order to make this happen at speed and at scale, I think you need to align somehow.

That's where leadership comes in. All the diverse needs and all the interests and that is, I think, also what you said in your question, it's all about balance between your core capability, core responsibility, which for us is keep the lights on, and innovation, which for TenneT is, you know, lighting the way ahead together.

And if I may say one more thing, I think, you know, you need to kind of three things. So you need, you need a vision and I'm sure we get to that in this podcast, you need a concrete plan also, and you need to stick to the plan and always put your execution first. And then last but not least, I think you need to, cooperate, right? Globally, throughout the whole supply chain, in order to kind of make sure we really drive for non-linear solutions. So examples are the two gigawatt programme in our world to the LionLink interconnector to the UK, and, for example, how we collaborate with all the North Sea countries. And maybe then one more thing, I think when you talk about leadership, you could say these times they call for cathedral builders, people who have the patience, to make a plan for decades which goes well across your or mine appointment term. So it's all about connective leadership and you need to be vulnerable as a leader. You need to be willing and able to lead by proximity, right? To stay really close to the people.

And then you need trust but I think that's in the title of the podcast so I'm sure we will get to that. But you need to somehow embrace and also express, I think, the discomfort that we are in and be ready to engage in dialogues.  

DITLEV ENGEL

You don't just have to manage the energy transition. The war in Ukraine suddenly shifted Europe's energy priorities. What challenges has that posed to you as the leader and to TenneT as an organisation?

 MANON VAN BEEK

I think the war changed, everything, well, in the world, in Europe, but also for TenneT I think our investment agenda has exploded. I think we have a ten-year investment forecast of €160 billion and so that means in order to address that challenge we need everybody on board.

If I then turn that around to what kind of challenges or concerns come then with TenneT – well, a lot but maybe let me pick out three. I think, first of all, we should really make sure that we do not waste any time on too long permitting procedures. They take eight, sometimes ten years. Still, yes, we need to do it carefully because it's about an environmental process but we need to do it faster together.

I also think we need to really make sure that the electricity demands keep pace with the increased supply. So, preferably in our world, the consumption is also very close to the supply. So we would really like to see the big industrial clusters to be at the coast to become much more sustainable, otherwise we will fill up our grids even more than they are today.

And of course, last but not least, in this situation, we need much more availability of the right people, materials, raw materials as well. And so we need to, as a company but I think also as a country, as Europe, to invest way more in technical training and also, I think the solution to the scarcity of equipment and raw materials just underlines for me the need to cooperate I think much more and much more intensively with each other.  

DITLEV ENGEL

 So when you look at the energy transition in Europe and broadly speaking, what is your view on whether or not the transmission is keeping up with the power generation? Is it properly balanced, or do you see some imbalances here?  

 MANON VAN BEEK

Well, I say often there is no transition, right, without transmission and so I would say kind of yes and no to what you say. So on the one hand side there is no straight line to a new economy. It's a whole journey. It's a whole process, you know, with peak, with valleys and so in our world we have to deal with full power grids with temporarily higher costs for energy. Bureaucracy, we've got high staff and material costs and in the Netherlands, where I am today, we also have a nitrogen crisis on top.

So I think it's really essential that we make sure that the electricity demands then keeps pace with the increased supply of the renewable energy and in particular this is true offshore, that we also make sure that the consumption then takes place near to the supply. Again, to make sure that the big industrial clusters, typically at the coast, become way more sustainable in order to prevent our grids to fill up even more. Would be curious also to hear Ditlev what is your vision here? You're into this as well.

 DITLEV ENGEL

We published our new power system report and we are projecting that we need grid capacity to grow 2.5 times by 2050, with annual expenditure doubling around the world, close to $1,000 billion. So the need is very clean, seen from our point of view but what we struggle with is for people to understand how critical the grid is for all of us and as you said, there will be no transition without transmission.

So how do we try to get people excited about having transmission lines constructed?

MANON VAN BEEK

Well basically if I then look at it from a perspective of the policymakers and what we need, it's actually we need stability. Stable, concrete policies that help are not only TenneT and TSOs, but also that help the big industry that help the small and medium enterprises that help the households so that they have the courage that they dare to make the leap towards a more sustainable production process or towards sustainable living mobility.

That is what we need and then we need the permits, we need the technical educated people. Of course we need also the international, constructive cooperation along the whole, value chain. If I turn it around, what you do not need, we do not need, I don't know if you say that, policy. That does not help.

I'm fairly happy also here in the Netherlands that, for example, here the Dutch cabinet is also continuing the current energy policy. I think that's what we need - stability.  

 DITLEV ENGEL

Long term forecasting and projections are key for the industry. Beyond transmission, what are your thoughts on the necessary storage capacity for the future and how do you envision this will evolve?

 MANON VAN BEEK

Well it’s a podcast in itself, but I think in general we are moving from the old energy system to a new energy system and I think in the old system you could kind of turn gas and coal power plants up and down. That does not work, I think we both know that, with solar and wind so there is a huge importance of flexibility. And you need that both on the supply side and I so you do that with clean, flexible power, but also on the demand side. Yes, you can do that through storage but also I want to add to that also demand side response from the industry so that industrial processes also move with supply and produce when there is a high supply of wind and solar, and also because as a society you can big time shift cost here.

And storage is then important in this kind of bigger flexibility agenda and I think now that we are on a podcast, anyhow, it would also be good maybe to share my ask also to the industry, the SMEs and also the market party set to help us TSOs, and also the DSOs, to help us in managing this scarce transport capacity. I think we are working with all that we have to expand but you simply cannot do this alone, so we need we need all of us here.  

 DITLEV ENGEL

I believe the integration of hydrogen will be crucial for the future of decarbonization in many sectors. Looking ahead, how do you envision the role of hydrogen evolving and how do you see it complementing all your other efforts?

 MANON VAN BEEK

All right, another podcast - hydrogen. So, I think we are working closely together here with the regional grid operators, but also, for example, with Gasunie which is another TSO, on a regular kind of an integrated infrastructure outlook and then I talk about towards 2045, towards 2050, it is simply not possible to electrify all the production processes, it's also not what you wish. And so we need to work together again here.

 You need a vision, long term vision on how molecules and electrons go together. You need a concrete plan here again and you need that collaboration. I must say, also on a leadership level, you need personal relationships, right? In trust with the CEOs, in my case, of those other companies. I think, I just give you one example - I recently visited Tata Steel, which is here in the Netherlands. At the shore, they need molecules to make green steel.  We land there with our green electrons. So, they are both really important for the industry.  

 DITLEV ENGEL

 Collaboration across and within industries is extending far beyond the energy sector. However, as you mentioned, this is also about trust. Reflecting on our work as an industry, do you think we are doing enough to build that trust with the many companies that rely on the energy sector?  

 MANON VAN BEEK

Well I would be curious to hear your view here as well. Yeah, I think I said it in the beginning. The whole thing with trust is that you have to give it away first before you receive it. I think this is important also as a leader. I think consumer trust, it all starts with kind of trust in yourself, call it self-confidence. Do you have the self-confidence, do we have the self confidence that we can transform society, that we can take everybody along, that we can move to a sustainable, reliable and affordable future?

And you need trust and confidence in each other, and also, be prepared together to give priority more to the long-term common interest over the short term self-interest. And you need to have the trust in the consumers in the citizens. So, maybe the kind of funny thing is, in order to restore trust with citizens, you have to give it first, so to give that trust to the citizens. And in all of that, it's all about communication and I think if there's one thing I learned over the last ten years here at TenneT, it's that you can never communicate enough so that is really important. And not only on a high level, the billions we invest, but also show it right, show it onshore and try to show it offshore, even though not everybody can go and see it.  

 DITLEV ENGEL

Well, you know at DNV we are saying that trust is just so crucial for everything we do and also our independence. So, I will fully agree with what you said i.e. that this is something that must be given before it's received and which is vital for the leadership of the transition and basically, that is also what we are trying to do as an organisation with the publishing, for instance, of our energy transition outlook, where we try to make it as transparent as we can because we also believe that is a very important part of creating trust in what's going to happen ahead.

Aside from trust, one of the key challenges we see at DNV is scaling rapidly in a reliable and safe manner. You mentioned a deployment of €160 billion, which is a massive undertaking. I'm curious about your perspective on the role of standardisation and process certification in facilitating the release of such significant funds to build the necessary infrastructure. How do you see these elements contributing to your efforts?  

 MANON VAN BEEK

Well, maybe if you look at it from a leadership perspective first, maybe the quality of a leader is kind of reflected in the standards right that you set for yourself and to your question, also the standards that you set for your company and I think for the market. I try to do that, we try to do that every day.

I just give a few examples - I think we have been developing and rolling out a standardised 700-megawatt sockets in the Netherlands for wind power access. Also 900-megawatt standards in Germany. I think we have worked with the market also to develop now a new standard- the two-gigawatt offshore grids. I think that standard will allow three times as much wind power to be transported to a single socket. It's also a global first and that's also why we took the initiative years ago to set up an R&D project with to market to develop that new standard and we are currently starting to build it and it's super cool because the new two gigawatts program will also be hub ready as we call it.

The next step when you talk about standards, of course, is to see how the offshore grids in the North Sea can be connected internationally and how we can create these so-called meshed offshore grids. So, a power hub on the North Sea that you can use to transport wind when the wind is blowing but also to trade when there is no wind and even to switch to hydrogen, for example, that we talked about, a few minutes ago, in the longer term.

And so when I close my eyes, I kind of imagine energy islands 10 to 15 GW. They are located between kind of offshore wind farms and also different countries that actually can act as a hub and they can transport huge amounts of wind power. Germany, the Netherlands, Denmark, UK, Norway. But when the wind is not blowing, that same network, for example, could be used to supply, well, let's say hydropower, from Norway.

And so I think such a North Sea wind power hub would guarantee, in my view, stability and it would also create the flexibility in the Europe’s high voltage grids that we so much need.  

 DITLEV ENGEL

Coming back to trust, I found it very interesting when you said that you have to give it first before expecting to receive it and you're working closely with partners in the Netherlands and Germany, as well as many other EU countries. How are you fostering collaboration and trust among these diverse partners, especially considering the massive scale of future projects?

And additionally, the more you can leverage each other's strengths, the better you can optimise your operations so could you share with us how this collaboration happens in the day to day business and in the [planning of all of your future investments?  

 MANON VAN BEEK

So how do I do that in practice? Well, I think it starts with vision and sharing your vision, engaging with CEO of other companies, going there, meeting them in person. Then also, again, I would say, then you make a plan, you collaborate, you pilot or you do something together, you learn from that.

I think I said it earlier in the podcast but the vision, concrete planning together and then the collaboration also here is key. As a CEO, of course, it's really, trust is something you need to do as a person. It's all about also personal relationships here.  

 DITLEV ENGEL

We talked a lot about money; we talked about cable transmission. But of course, nothing of this will happen if we don't have the right people in the company to execute all of this. And I know that you have been serving on the supervisory board of Delft University of Technology. You also work with the Refugee Challenge Hub foundations and you are constantly on the move for new talent.

And with your own very impressive career, how do you try to share your vision and get young people excited to get into the industry?  

 MANON VAN BEEK

Good questions. At TU Delft, I just started a year ago and the Refugee Challenge Hub I'm going to hand over after the summer, but I think to young people who are considering a career in energy, I would say, first of all, go go go.

I think, of course, you can learn a lot, do a lot, and it's very purposeful, so I would wholeheartedly recommend it. I would also recommend to young people to grow themselves. I think it's also really a sector where you can move your boundaries and as a sector we should move also our boundaries.

I think when I look at talent also with my other hat on, for example, for the Refugee Challenge Hub, I think too many people they are still somehow not allowed to be part of an organisation despite all the challenges that we have, despite all the shortages that we have. I think I said in TenneT sometimes we need to kind of recruit more unsuitable staff rather than only suitable staff.

I think, you need to look at more the unusual suspects rather than the usual suspects, maybe to look more at, I call that often talent passports rather than a curriculum or a bio, looking at upskilling, looking at training. I think the only way to adapt to our new environment as an organisation is talent development, talent development, talent development.

And last but not least, I think if you build a more diverse organisation in all senses, it just makes your company more profitable, more meaningful, more fun.  

DITLEV ENGEL

One final question. Many of our listeners might not know about your impressive career at Accenture, before you moved to TenneT. So for young graduates joining one of the big consultancy firms might seem this more exciting than joining, for instance, a TSO.

However, that's the choice that you made. What attracted you to this role at TenneT and the industry overall?

MANON VAN BEEK

Duty is calling. That is what I said five and a half years ago when I joined TenneT. I cannot summarise it better. And I have also learnt a lot in my previous career. I think also in my previous jobs, it's all about growing yourself. It's all about learning to be kind of comfortable in uncomfortable situations, and that's very helpful in my current job.

DITLEV ENGEL

Right. Time flies when you're in good company. Manon, thank you so much for joining us today and sharing your perspectives on the energy transition and the best of luck to you with all your exciting challenges ahead as individual and as a company.  

MANON VAN BEEK

Thank you very much Ditlev. It was a pleasure.  

REMI ERIKSEN

You've been listening to Trust and transformations - leaders navigating change, a DNV podcast. Head to DNV.com to hear more episodes of Trust and transformations or subscribe on your favorite podcast platform so you'll never miss an episode. Thanks for listening.