Interview with Tom Foley
Executive Director of UK, Europe & Middle East Future Energy at GHD
While the energy challenge may seem global, there are differentiators between regions as the mentality shifts around electricity and the areas where it is sourced.
While global events have lasting effects on the energy supply chain network, Europe, the Middle East and Africa (EMEA) saw major disruption resulting from a number of events. The response from region to region hinges on their specific needs and the state of geopolitical actions towards renewable development.
EMEA now seems focused on localising the majority of its renewable energy and diversifying with new technologies and solutions that are historically under-utilised. Speaking on this is Tom Foley, the Executive Director of UK, Europe & the Middle East Future Energy at GHD, who explains what the landscape currently looks like and how organisations can respond.
Tell us about GHD and its activities to drive sustainable business growth
We have an ambition to grow our business by supporting our clients as their worlds change. In a nutshell, we are committed to energy, water and communities and the future of those is where we want to carry out our primary business.
The energy transition has really been a test for the region, most notably by the loss of Russian gas and concerns over security of supply. Connected, in part, to that has been the acute issue of energy affordability. And then, with recent reports highlighting concern that we're just not moving quickly enough, we’ve seen fresh impetus for the introduction of new measures and more visible targets.
GHD is working closely with energy sector clients to develop policy and net zero pathways, engineer new energy infrastructure; and de-risk investment in new technologies that are critical for transition success.
Could you explain the energy challenges EMEA faced and provide your perspective on its response?
We had a fairly mild winter, and so were saved very much from the full impact of the loss of Russian gas. Although many changes have been implemented, there is still concern around energy security that has polarised the industry. In one respect, it’s really accelerated some investment aimed at exploiting indigenous, renewable resources and, in another, delaying investment until the full effects of the crisis become known.
The energy transition will be very expensive and the market is always looking for greater certainty given the scale of investment. One of the things we noted in our recent industry study, Shocked, was a fairly even split between those energy sector senior decision makers believing the energy crisis was an accelerant for the energy transition or not.
What’s your perspective on recent disruptions and what have/can businesses learn from them?
There was a real step up in volatility in terms of energy prices that were seemingly localised. There have been big changes on a global scale, but more marked in Europe. It really brought home a couple of points: over-reliance on individual suppliers for energy—an example being Russian gas—and stark awareness at the degree of reliance on Chinese supply chains for batteries, solar panels and, more broadly, rare earth minerals.
Disruption has really caused people to look carefully at rebalancing their supply chains and resources.
Diversification is key: steering away from being reliant on just one supply chain; but also looking at what else can be achieved through other means. The volatility in commodity prices has also made people turn to question the financial resilience of the industry.
What further areas are disrupting the energy sector in its transition to renewable energy?
We are helping companies be more deliberate in their scenario-planning: raising awareness of their reliance on supply chains, certain technologies, resources, perhaps vulnerability to more extreme weather events, which is obviously disconnected from Russian gas.
The focus is more about risk awareness and continually testing low-probability but high-impact events. There's a greater need to engineer solutions that are more resilient to extreme weather events. Perhaps needing a higher degree of contingency planning for certain designs and arrangements to maintain integrity through whatever is thrown at our energy systems in the future.
How do you expect the energy landscape to evolve over the next couple of years?
In terms of the mix, there is a clarion call for the industrialisation of ‘bankable’ renewable energy technologies. We've got ambition to go large in offshore wind and rethink our approach to onshore wind as well. We've seen very rapid deployment of PV across Europe and this is set to continue.
I am optimistic about the future energy transition but there are some channel challenges around the industrialisation of and deployment of these renewable technologies, but that will really come down to providing more financial certainty or faster planning processes, rather than the technology itself.
“It’s about turning it beyond building that market awareness; beyond that education to actually go after tangible, measurable, replicable claims”