26 June 2017
For about fifteen years he has been dealing with energy at Edison, the oldest power utility in Europe (now controlled by the French colossus EDF), where since September 2016 he has been the head of the Energy Services Division, a structure set up to expand the expertise and portfolio of Edison Energy Solutions and Fenice in Italy and abroad. Paolo Quaini is an economist with a passion for innovation in energy in a world of engineers, a manager who is facing a profound transformation of the market and is being asked to rethink strategies for coping with it. We encounter him at Edison’s historic headquarters, a jewel of the Art Nouveau style on Foro Buonaparte in Milan, in a brightly lit meeting room, enlivened by an orange wall—the color of the brand. Where we talked about big data, the internet of things, BIM and the smart city. In very concrete terms.
The energy scene has changed a great deal over the last 10-15 years. Can you talk to us about these changes and tell us how they are connected with Edison’s new makeup?
Ours is a company with an important history of which we are very proud. For over 130 years we have been supplying electric power and natural gas. Now our market is changing. The consumer is more demanding and well-informed than in the past, and in some cases has even turned into a producer of energy. Edison has reconstructed itself around customers and their needs. From providing a public service in which, essentially, the aim was to guarantee the quality of that service and its continuity, we have shifted to an almost obsessive focus on consumers, seeking to understand their requirements and satisfy them rapidly in the most innovative fashion.
What services does Edison offer families?
Many. The Smart Living console, in particular, is a starter kit capable of turning any home into an automated one: it is a hub to which over 50 compatible devices can be connected, including lamps, sensors and thermostats. And then with Casa Relax, for just a few euros more on the bill, we are offering services for the repair of faults in electric or gas systems in the home and for the installation and maintenance of boilers and air conditioners, with emergency repair teams ready to swing into action 24 hours a day, 7 days a week.
Shaping a deregulated and innovative future for energy that puts the customer at the center was the slogan of the appeal to parliament and the government that you endorsed in May to draw their attention to the urgent need for approval of the bill on competition. Shortly afterward the bill emerged from the Senate with a postponement of the end of protection for the energy market until September 2019. What is your view of this measure?
That appeal was a follow-up to a detailed manifesto drawn up in 2015 in which the key points were innovation, conservation and sustainability. The bill certainly goes in the right direction, but the sea change we are living through demands more rapid action. Users have many optimal solutions at their disposal that do not affect just the managing of their bills, but also the setting up of the internet of things and, in general, the possibility of enjoying greater comfort in daily life. They have developed the ability to choose in a conscious and independent way: if we deny them free choice we are placing great limits on the possibility to innovate.
The Energy Services Division has been a fundamental step in bringing Edison into line with this vision of the future of energy. How does it operate?
It was essential to strengthen this area, which had existed for some time and had already developed on the basis of some vertical solutions. Our approach presupposes an attention to the system of appliances, rather than to the individual elements. The technologies at our disposal make it possible to respond to specific requirements, but they need to be optimized to conserve energy and, consequently, reduce emissions of CO2. Let me give you an example: if before replacing the heating system I haven’t insulated the building in which it is located, I will certainly be saving money, but not as much as I could. In everyday life, the things we find most fascinating are the ones that allow us to connect up objects that already exist. Like IF, an application for the internet of things that can be used to connect elements made by different manufacturers and get them to interact with one another, allowing you to program what is going to happen and when from your smartphone. We are working along similar lines to make the system of smart devices efficient in a personalized way.
What is the level of awareness in public administrations with regard to this approach?
Normally they are interested in introducing innovations into the street lighting system or upgrading the energy supply in schools, but not in adopting a program that would integrate these and other such services in a way that would improve the quality of life of citizens.
Why is that?
First of all, there is no offer tailored to suit public administrations: often utilities limit themselves to responding to individual calls for tenders, as it is simpler. Then there is a cultural aspect, especially in Italy: going off the traditional tracks is viewed with suspicion and always entails a margin of risk that not everyone is willing to take. There is a certain change under way, but it needs suitable guidance and support.
So there are no problems of an economic nature?
The point is to weigh a short-term benefit against the maximization of value and advantage in the medium and long term, in other words to compare the traditional approach of intervention in the plant with the more innovative one of acting on the whole energy system. The former has been adopted over the last 40 years and the result is that the plant is well run but public buildings, especially schools, are falling apart. We need to focus on the value of the building over time.
Local authorities often face financial difficulties and act only in an emergency.
We are well aware of this. It is why, alongside a turnkey model of service where the customer is given assistance in the planning process, in the selection of the best technologies available and during the installation phase, we are proposing a type of intervention (the ESCo model) in which we make the investment instead of the customer. The investment is repaid through a share of the savings made. It is our intention to extend this offer, originally conceived for private companies, to public administrations as well.
Let’s talk about the smart city, a concept that concerns our future and the quality of our life. Often ordinary people don’t know what it means in practical terms and what advantages it provides.
From a broader perspective, a city is not “smart” simply because it is digital: it becomes smart when it manages its natural resources in an intelligent way and invests in a number of different areas—human and social capital, traditional infrastructure (mobility and transport) and modern information and communication technology (ICT)—that make it possible to foster sustainable economic growth and an elevated quality of life. From the viewpoint of infrastructure, which is what affects us most directly, it is fundamental that the resources available—the priority is to make use of natural ones like photovoltaics and local biomass—are utilized as a “network” to improve the economic and political efficiency of the city and permit its social, cultural and urban development.
So the process of moving toward the smart city needs to involve everyone, from the resident to the local government.
This is why, before studying any intervention in the city, we collect all the data available and analyze the urban context, which is a mixture of physical and virtual reality (created by the network of computerized systems that connect people). We interact with the administration together with city planners and architects. In this sense we see ourselves more as designers of the smart city than as organizers.
Are you working on any particularly interesting smart projects?
In Shanghai, our parent company EDF has been involved, along with a city planner, in the redesign of an entire district. In one of France’s main cities, they’ve asked us to set up a control room to monitor and manage the key indicators generated by public lighting systems, CCTV cameras and parking sensors. In this way, the administration is able to keep tabs on the level of progress in the activity of the suppliers that it is paying for services and, thanks to big data, also create an information base that can be used to manage the life of the city’s residents. A database that will become an asset for the local ecosystem, for startups and for companies. Managing information has great value, like buying a new lighting source for a school or changing the plumbing system of a city.
And renewable energies? What is the potential of this sector?
Edison is very active on this front, which is historically part of our DNA given that we have numerous hydroelectric plants. We are the main producers of energy from renewable sources in Italy and we have set ourselves very significant goals for increasing our generating facilities. For several months now, thanks to our acquisition of Comat Energia, we have been providing biomass-fueled district heating to more than fifty consortia of municipalities in the mountains of Piedmont. Our idea is that the package of energy services should comprise reductions in consumption and its optimization and self-production from distributed renewable sources. Moreover, the regulations are very advanced in this sector: for new buildings and major renovations there is an obligation to install solar panels on roofs.
Politics has a fundamental role in accelerating innovation in energy.
If an offer capable of meeting the needs of customers were to be accompanied by suitable regulation, demand would increase and there could be growth. The entire labor system would benefit from it: upgrading even a small part of the building stock would have an enormous spinoff for local employment.
The basic element of an intelligent city is a smart building. Let’s talk about BIM. At the exhibition Space & Interiors on the possible future of interior design staged by Edison during the last Milan Design Week, the definition provided was “digital democracy.” Can you explain what this means?
Building Information Modeling is a method of integrating processes of architectural design, maintenance and sustainability to optimize, with the aid of software, the planning, construction and management of buildings (Edison uses it in Italy in collaboration with the Magnoli & Partners firm of architects in Cremona). Using BIM, not only do you design better, but you can manage the building throughout its life cycle, easily carrying out alterations, keeping track of how they are done, what materials are in the walls, knowing if they contain asbestos, and so on. It is a structured and methodologically sound system for identifying what are the returns on an investment in a work of architecture. A building represented in BIM, through 3D visualization, makes it easy for a public administrator to illustrate to people the level of energy inefficiency of a project or an area of intervention, and to show where the urban setting can be upgraded, what are the objectives in terms of lowering costs and reduction in the emission of greenhouse gases. This is why I speak of digital democracy: BIM is an important way of improving communication and the level of participation in projects. In France it has been used for a very long time to illustrate a political program. Working with BIM, alongside engineers and architects, means producing a “beautiful” design that becomes contagious and triggers a change in the behavior of individuals. It is fundamental to come up with solutions that look good.
How much awareness of BIM is there on the part of architects and planners?
Celebrity architects and the big property development firms have been using it for some time on their more important projects. But a country is made up chiefly of very old buildings of small size, on which intervention is carried out in an artisanal manner, that is without planning or major objectives of overall saving. Our ambition is to democratize through BIM, constructing a service that allows condominium administrators to use our expertise and our software to upgrade the property they are in charge of. For the moment we are proposing this approach to some real-estate managers—the advantage is that working with a single partner we are able to intervene in many buildings.
This method of design could be revolutionary, especially for a country like Italy where, according to a study by the CRESME, 84% of buildings do not meet current standards or are over 40 years old. And then there are the areas struck by earthquakes.
Edison is very sensitive to this theme. In the Edison Pulse competition for the most innovative startups we have included a special Earthquake Reconstruction section. A catastrophic event of that kind should be turned into an opportunity to innovate. We are already at work on several projects in this area: in particular, we are holding discussions with the Club Alpino of Amatrice on an initiative of reconstruction.
In this case too, an intervention from the legislature would help.
We are trying to build consensus at the level of the appropriate authorities because, at least for some major upgrading projects, there are constraints on its use. At the community level there is already a move in this direction, although there are no precise requirements to make extensive use of BIM.
Training in the field of energy efficiency is an important question. You have embarked on a series of collaborations with research institutes and universities.
Our Energy Efficiency Campus is very active. We recently held a seminar in partnership with the Surveyors College in Turin on the subject of BIM and we are working with Milan and Turin Polytechnics, which have specific courses and are training professional figures that are indispensable today. What is needed is to raise the demand for this kind of service. It is a problem linked to the cultural aspects of which we have spoken, to the lack of a regulatory stimulus from the appropriate authorities as well as of adequate information. We will continue to do our part, to make innovations in what we can offer and to make it as affordable as possible.