ENERGY & UTILITIES
The field of energy & utilities grows ever more challenging. Energy companies must cope with a rapidly changing competitive environment, demand for heavy investment in generation and grid, the rise of renewable energy, the push toward energy efficiency, and at the same time the advent of unconventional gas and oil. New regulatory developments and more sophisticated customers also add to the difficult business environment.
In the water business, large capital expenditures are needed to develop new infrastructure in developing countries, while in developed countries existing infrastructure needs revamping in a context of sharply decreasing volumes. In the waste business, decreasing waste volumes and separation of waste streams in developed countries are requiring waste companies to reexamine their businesses entirely. Across the board in energy & utilities, change has become the status quo.
Together with our clients, we develop the strategic, operational and organizational answers to these challenges and help implement tailored solutions that work. Many of our clients are active across the entire value chain, from exploration and production to retail, while others focus on a specific niche, like trading or grid operation. Some clients have a broad multi-utility focus and offer a range of products to their end-users. We also work for these end-users, many of them large industrial players, and we advise governments and regulators at the regional, national and supranational levels. We also advise new entrants from other industries, who look at this changing environment as an opportunity to bring disruptive answers.
The energy & utility sector is a pillar of Roland Berger's business. We have more than 170 professionals worldwide dedicated to this field.
Our project portfolio comprises more than 300 projects in over 30 countries across the globe. We serve leading energy & utilities companies, helping them tackle challenges in three fields:
- Corporate, including strategy, post-merger integration, performance improvement and reorganization
- Functional, including marketing and value management
- Organizational and operational optimization across the value chain, from exploration to retail
There is an acute need for tailored solutions in energy & utilities. Companies working in this industry have very specific structures and the markets in which they operate are in a constant state of change. These players are working to realign their competitive positioning while at the same time delivering shareholder value, being socially responsible and creating or maintaining their competitive advantages. Helping our clients tackle all of these challenges is our mission.
We also serve industrial clients that depend on power, oil and gas. Volatile prices mean they face massive uncertainty in their cost positions. We develop sound models that help validate the choices made, drive make-or-buy decisions and help assess opportunity/risk profiles of different solutions. What's more, our supply and demand-side experience has made us the consultant of choice for regulatory issues.
In our work, we cooperate frequently with our Roland Berger colleagues who have experience in other industries and specific functional know-how. For instance, we work side-by-side with our corporate finance experts in due diligence assignments on investments in energy companies or projects for investors, like private equity companies or infrastructure funds. Roland Berger expertise in engineered products and the high tech industry provide valuable contribution to energy & utilities projects, as well.
With all our clients, we share the belief that knowledge of the industry, functional expertise and a local "feel" for the situation must be combined to produce the best results.
Through our projects and market studies, Roland Berger develops broad know-how in the energy & utility sector. While operating at the forefront of sector developments, we develop views on the future energy & utilities sector jointly with our clients. These shared views are essential in helping our clients shape the future industry. Some of our views are presented below.
Energy efficiency (EE) is a must in today's energy policy but is difficult to achieve due to the high number of levers that must come together to secure significant savings
- EE is a must in public energy policies, both for new build and for reconstruction of existing facilities; it is an alternative to extension of power/heat generation capacities and it contributes to Kyoto objectives
- EE aims at saving energy without significantly limiting end-user consumption patterns
- Savings can typically reach 20-30%, depending on the starting point. All sectors may be targeted by EE levers: industry, housing, commercial/public buildings, transportation, etc. Several types of levers can be implemented to achieve significant savings
- Many governments and public bodies around the globe implement measures in favor of EE, e.g. direct subsidies, incentives, taxes, pilot programs; but there is no comprehensive and global approach towards EE, as was the case for CO2 via the Kyoto protocol
- EE may ultimately challenge utilities' business models, at least in mature countries, as these companies will need to shift from a volume-driven model to a service-focused posture to go together with their clients in this direction of using energy efficiency. But utilities cannot develop such strategies on their own, as EE implementation requires an assemblage of capabilities and experiences from a number of sectors: appliances, energy services, engineering, real estate, etc.
While the Fukushima accident has been a severe blow to the nuclear industry, nuclear power generation will remain a key and credible instrument in the global fight against climate change
While the Fukushima accident has been a severe blow to the nuclear industry, nuclear power generation will remain a key and credible instrument in the global fight against climate change – More than 200 reactors will start by 2030, in a market that will yet shrink from 7 to 35% – OEM as well as utilities will however face huge investments in order to adapt to the game change – Beyond investments, it is also a cultural and national and international governance change
- While nuclear seems to be more heavily challenged across the world, for environmental, geopolitical or financial concerns, its development perspectives remain solid, with more than 200 reactors due to start operations towards 2030, mostly driven by Asia
- Even in Europe, several countries have restated their commitment toward nuclear generation, as a key instrument of their fight against climate change
- The Fukushima tragedy has however been a severe blow to the global nuclear industry as it has raised three types of concerns
– Are there design flaws, especially on ageing assets, that can generate accidents or make them more severe?
– How to make sure that Nuclear Safety Authorities in nuclear countries enforce the most stringent and up-to-date regulations?
– Is the international nuclear community homogeneous and organized enough to provide guidance, monitoring and enforcement of nuclear safety rules across the world, to avoid accidents that have an international reach?
- As a result, the nuclear industry is undergoing huge changes: post-Fukushima assessment and improvement, convergence of safety regulations, improvement of new designs, preparation for decommissioning, but also enhance individual and organizational safety culture, and international governance