How to Manage the Energy Transition
People will always need energy, so we’ll always need energy tech. We spoke to energy expert and cluster manager Wolfgang Korek.
People use power every day. In our technologically developed society, it’s pretty much impossible not to. We need energy for heating, for mobility, for day to day use of devices, for work. Vast amounts of energy are necessary for industry and business, in production, transport, service – even digital platforms require an abundance of electricity.
Now, after the pandemic related slow-down, the demand for energy is as great if not greater than ever before. The world population is growing, and huge countries are progressing technologically, with the result that the global need for energy is rising. This development seems inexorable.
So how to deal with the hunger for energy?
When it comes to city policy, Berlin is responding to the challenge by focusing on:
- increasing renewable energy production, mainly from solar power
- optimizing energy grids and storage systems
- increasing energy efficiency, that is decreasing the waste of energy
- new technologies around hydrogen
In Berlin, the players in the energy cluster all work together. Business and industry, science and research institutions, startups and investors are all coordinated by active networks and city strategies. Furthermore, the federal state of Berlin works in particularly close partnership with the state of Brandenburg, the area which surrounds the capital. Berlin Partner as economic development agency plays a decisive role in this coordination. Cluster manager Wolfgang Korek explains.
Interview with Wolfgang Korek, Cluster Manager Energy Technology
Wolfgang, what is your most urgent and important activity in your work currently?
Currently... Well, as you know, energy technology is a sector which gets a lot of attention from all sides at the moment, in Berlin, in Germany, worldwide. So we have on the one hand record prices for electricity, for heat. On the other hand, we have climate goals that we have to tackle as the city of Berlin, as Germany, probably everywhere in the world. And we have to contribute to achieving them.
And how do we do this? Well, first of all, one of our basic tasks is actually managing the cluster for energy technologies. We’re talking about some 5000 companies in Berlin and Brandenburg, the surrounding state, employing some 60,000 people. And our job as cluster management is not only to attract companies from this sector to Berlin, but also helping established companies to grow, to grow further.
In particular this means identifying and supporting the R&D intensive approaches. Which are they? Where do they come from? We bring the people and organizations together which are into R&D intensive projects and ideas, and create innovation projects out of it. That means we help, we support projects, or ideas that could become projects, to get everything they need to hit the ground running and to bring innovation in energy technology to life in the German capital region.
There is, in Germany at least, often talk of a “turning point” when it comes to energy production and supply. What do people mean by the term? And has Berlin reached this turning point?
Well, this turning point you are referring to, the “Energiewende”, has different aspects.
The first step was to establish more and more renewable energies and to get out of fossil fuels and fossil energy step by step. What we see now is that we have a surge when it comes to photovoltaics, and when it comes to wind power. So there is more and more of this in Berlin and in the neighboring state of Brandenburg.
What we still have to deal with is the demand side of energy. How can we make better use of volatile energy which is not at hand for consumption 24/7?
And also we think about how we can reduce consumption of energy. How can we not only reduce it but make consumption more efficient and intelligent? And there are ways to do it. One of them, which is much discussed in Germany, is what we call “sector coupling” [the idea of interconnecting or integrating energy consuming sectors such as buildings, transport, and industry with the power producing sector, using electricity as the default energy source, even if it is used to produce hydrogen].
I think that Berlin and Brandenburg are perfect breeding ground for sector coupling. Why is this? Because actually the region has vast potential for generating power from renewable sources. In Brandenburg they have numerous wind power plants, they have bioenergy. As a city, Berlin on the other hand has other priorities. You cannot build hundreds of large wind power plants within the city. But we have thousands of rooftops suitable for solar power. And not to forget that Berlin is a heavyweight on the demand side of energy: We have industrial production, we have trade, commerce and services industry, and we have the sheer size of a population of nearly 4 million. It’s all about bringing them together, supply and demand, not only in the electric sector, but also when it comes to heating, when it comes to mobility. We have to bring both renewable energy production and intelligent consumption of energy together in Berlin and with the surrounding state Brandenburg.
And is that taking place?
Well, we have had major projects contributing to the “Energiewende” and sector coupling during the last five years. By far the biggest one, which still is quite well known to the public, is called WindNODE. Node stands for itself, but it also stands for northeastern Germany (Nordostdeutschland). This was probably one of the biggest “Energiewende” projects running in Germany, I would say, because all five eastern German federal states were parts of it. We had 40 full project partners, both from industry and academia.
In the course of the project many solutions have been developed as to how to make energy consumption more intelligent by shifting loads, by shifting energy consumption from day to night time, by shifting from one consumer to the other, if they are, for example, neighbors and are separate from an electric point of view. These ideas and many other aspects.
How has energy technology in Berlin developed in recent years?
Well, the WindNODE project I mentioned is an example.
Also, for instance, new networks have been established. Take for instance Hydrogen, which is a hot topic now. Two years ago already we saw the creation of a network called H2 Berlin, of which we are a founding member, and we continue to support them.
And there are many startups in the sector.
Besides all the startups, you might say, ‘Okay, but where is the industry?’ [B2B] Startups need industry in order to develop. A big and positive signal was that a multinational company like Siemens Energy chose Berlin for their headquarters. They very actively decided Berlin needs to be the headquarters. Siemens was built here in 1847. They have the roots, they have their big plants in Moabit and Siemensstadt. And they see the potential that Berlin has. They see the advantage Berlin has because of the skilled workforce, because of the startups, because of the academic partners, because of the support they might get from the city of Berlin. And we are very proud and happy that they have chosen Berlin for their headquarters. Hopefully many more of these bigger companies will follow. Not always with headquarters, of course, but let it be an R&D center, let it be an incubator. We’re happy to have all of them here.
What is Berlin doing right in terms of energy?
Berlin, I would say, is one of the frontrunners when it comes to promoting photovoltaic installation. Why is this? Berlin has some of the most ambitious goals when it comes to getting more solar energy onto rooftops. It was one of the first German states to create a law actually telling people such as house owners or companies who want to either build a completely new building or refurbish their rooftops, that they have to install PV installations. Berlin was one of the first states to do this, and recently more and more German states have taken exactly the same approach.
Berlin wants to become CO2 neutral. And it's important to not only rely on the surrounding country for getting your renewable energy, but also to do something about it within the city.
How do Berlin and Brandenburg, the federal state that surrounds the city state of Berlin, cooperate in the field of energy?
Generally speaking with joint strategies. The latest example is the joint strategy on hydrogen. It was formulated by Brandenburg, but Berlin is involved as well. So both states see the potential that hydrogen has for the energy system of the future, both for mobility and for the heating sector. We can contribute a lot to technology development and testing in this field and will do so together.
More precisely, and speaking more about daily work, we have the joint cluster management on energy technology. So what I and my team do on the Berlin side, making R&D projects happen, supporting start-ups and companies that want to relocate to Berlin. The same is going on in Brandenburg. We work closely together with constant communication, and we implement projects together. For example, the one I mentioned, the big one, WindNODE, was driven by Berlin and Brandenburg together, perfectly I might say. Players from both states were involved.
What support does Berlin Partner offer to companies that come to Berlin?
First, we start with providing information about what the Berlin competencies in the energy sector are, meaning which ecosystem is available already, which players are there, which are the technological areas that might flourish, that might develop in the future, which are important for Berlin development, and for Berlin climate goals.
Apart from that, we help incoming companies by delivering some special services. For example, we help them find the right location in Berlin. It depends on the size. You might say, ‘Okay, where is there enough space in Berlin for a huge battery production or a solar production plant?’ Of course, space is limited, but everything which can be handled by Berlin which is R&D intensive, for example, such as an R&D center or incubator, from an energy company for cooperating with startups is welcome to Berlin and we help them find the right place, the right location.
And the right staff.
And once they are here, we help to integrate them into the ecosystem of existing players. And this, for our part, means starting projects together and binding them together with the existing players, both from academia and from industry.
How important respectively are research institutions and startups? Which institutions and startups are notable?
Both are highly important, I would say, because they are both very, very good cooperation partners. And this comes from two sides, from academia and the startup world. If you take all the academic institutions in Berlin together, which is not only universities, but there are many institutes of the Fraunhofer group, from Leibniz, from Helmholtz.
Which Chancellor Olaf Scholz just mentioned in his speech at the World Economic Forum in Davos …
Yes, because of the world record that the researchers at Helmholtz-Zentrum Berlin achieved with Tandem solar cells. It's quite unique in Germany to have these extra university research organizations, and they do a really good job. And if you take them all together in the energy sector, you have probably the highest density of research activities going on in the sector in central Europe, I would say.
And they are not only into basic research, at least not in the energy sector. It's very directed at the market. They have very high TRL, technology readiness levels, and they are used to being cooperation partners.
Moreover, of course, companies here in Berlin are looking for qualified staff, for qualified workers, and many of them come out of the many universities here. And in this point, I guess Berlin still has an advantage over other German cities because Berlin is a pull factor in itself. So people from Brandenburg, from the rest of Germany, from all over the world, come here because they want to be in Berlin. And often they stay here.
So this is academia. As for startups, I think it has been stressed almost too often that Berlin is the startup capital of Germany. This is true for energy technologies as well.
I think it's still true that we have by far the highest number of incubators and accelerator programs for clean tech [see our article on cleantech accelerators] and energy, for the energy sector or energy startups here in Germany. So that tells you not all energy companies are here with their headquarters, but they all seek to be here at least with their most R&D intensive, with their most progressive units. Because they know the startups are here and they have to be here to cooperate with them.
What about financing in the energy sector?
There is one, let's say, disadvantage about financing startups in the energy sector, because you need a lot of investment. Because energy projects are more than just putting up a computer and running a platform software. It's actually opening up roads. It's to install transmission lines, for example. To install PV, to install hydrogen, solar. Which all costs a lot of money. So if you're not only a platform startup but you really try to change infrastructure, then it's very costly. And I guess this is the main reason why investors are cautious about investing that much into energy startups.
But there are examples that this still happens. Take Enpal. Enpal is a startup built in Berlin, flourishing in Berlin. Recently they finished their second, I think, financing round of some €800 million [we reported]. They are in the PV sector and they lease PV installations to house owners, and this renting model is quite unique in the market. The first German unicorn in the energy branch, actually [of course we mention them in our article on Berlin unicorns]. There are other companies not as famous as EnPal but doing similar things when it comes to heating for apartments. Some are very successful with this.
How can it be assured that energy is sustainably produced and fairly distributed instead of at the expense of the Earth’s resources and the poorer population?
Well, I’ve spoken about photovoltaics, which will make a good share in the future for renewable energy production in Berlin, for the electric sector.
For the heating sector, many people here and elsewhere rely on hydrogen to be a big, big solution for many problems concerning mobility and the heating sector. And the infrastructure is being built, not only in Berlin, but there's a huge German wide project. We do not have the amount of hydrogen that we would need at the moment and will also have to rely on imports from developing countries which are blessed by favorable geographic conditions. But of course this cannot be transformed in one year. This is a huge infrastructure investment and many eyes are watching this, many are relying on this to work.
And batteries are important as well, right? Making the storage of energy more efficient?
Yes. I think you have to differentiate between stationary battery systems and electric vehicles, EV [see our article Power to the People]. We will need more stationary systems, I'm sure, to be very flexible when it comes to storing surplus electric energy in the short term and feeding it back to the grid at short notice when necessary.
The much bigger market is the EV market for electric vehicles, electric cars [see our article Sweet E-Motion]. And that's where we think that Berlin also can make a difference and can be an attractive location for even battery producers, be they from Korea, from Japan, from China, from European countries. As I said, not for the huge cell production plants that would cover 100 or more hectares, but for the whole value chain, R&D, second life applications, cooperation with startups. This is very easy to do in Berlin for the battery sector and we do put a lot of effort into batteries at the moment.
Thank you, Wolfgang
If you’re in the energy business, reach out to Wolfgang here:
T +49 30 46302-577
Write an email
Interview: Olaf Bryan Wielk, ideenmanufaktur
Header image: © Berlin Partner/photothek