Renewable Energy Holds Great Potential for StartupsACCORDING TO CARLO MARIA MAGNI, ALUMNUS AND ENTREPRENEUR: THE MARKET IS HUGE AND UNDERGOING A RADICAL TRANSFORMATION, SO THAT OPPORTUNITIES TO DO BUSINESS ARE MANIFOLD
The revolution of renewable energy is accelerating its pace by putting in question consolidated utility models of electricity generation. On the Old Continent, as per OECD data compiled by the IEA, the transition is fully underway, but also in the rest of the world investment in renewables already accounts for the lion’s share of new capacity added in power generation. The ReFeel Group, an integrated and independent energy operator founded by three Bocconi alumni a decade ago, understands this well. It is active in various countries of the world and provides innovative and sustainable solutions for energy efficiency and the development of renewable sources.
"ReFeel comes from a long time ago, from the dream I had at an early age to achieve sustainable self-sufficiency, such as doing your own objects by assembling what was around..", says Carlo Maria Magni, Bocconi alum (Class of 1988, Economics), entrepreneur and founder of the business group. He goes on: «The desire then turned into an ambition by observing a market that was changing in a revolutionary, disruptive way. We started as a real startup and today we operate in a number of countries on several fronts, by offering the construction of renewable energy power plants from scratch, as well as management and development of existing electricity generation plants, and new solutions for energy efficiency and sustainable mobility».
What is the approach to renewable energy you have found in developing countries such as Colombia, Costa Rica, Panama..?
Our approach consists in seeking to maximize local potential, not only in terms of market opportunities but local resources. For this reason, we develop the collaboration between the central team and the local teams, because only them are able to interpret and manage the dynamic of the host country. At the moment in Latin America, for example, there is great ferment and renewable energy sources have become the natural answer to growing energy demand. The phenomenon is similar to what happened with the arrival of mobile phones, which enabled developing countries to sidestep the costly laying of landlines. The technical capability and experience are still lacking and there is strong opposition coming from the world of conventional fossil sources.
There are areas, such as mobility, in which the issue of renewables is of great relevance and others in which it struggles to have the attention of public opinion. How is your business influenced by the interplay of energy trends, politics, media, and marketing?
The media mainly care about appealing images: a building’s heating system is not catchy, while a beautiful electric car attracts more interest. Latin American media tend to work in the same way, although, in my opinion, the low quality of Italian media and of people’s communication on social media is worrying, and even more so is the level of functional illiteracy, which is the worst in Europe. Having said that, I believe that people really want greater sustainability, understood as cleaner air and water, and, more generally, a world that can be hospitable to and habitable by future generations. Today, the world’s cities, where 50% of the global population is concentrated, are becoming increasingly inhabitable and the planet is turning less and less welcoming, as an unpredictable and dangerous climate crisis looms over the horizon. Renewables can make the difference and improve the situation. Zero-emission mobility is certainly a road to be taken, but there are many other areas where policy and business interventions can have beneficial impacts.
From your point of view, therefore, is renewable energy still an area where new startups and business ventures can emerge?
The renewable energy market, and more broadly energy sustainability, is a huge and constantly changing industry. There are plenty of business opportunities in areas such as: market expansion of technological solutions already being tested; development of new service models in a market that is changing the traditional distinction and dynamic between producer and consumer, by evolving towards Prosumer Energy Systems; energy optimization not only as a good to be sold but also as service to the final user that needs to valorized in terms of advanced integration and environmental comfort (Energy Performance Contracts); the increasing availability of data to make energy systems more responsive/ adaptive (Smart Energy Systems).
How does renewable energy affect the business models of new operators entering the market compared with industry incumbents relying on conventional sources?
Renewables have the advantage that can be integrated in a world refusing to be divided in distinct and distant areas of production, commerce, recreation, and habitation. In my view, our society is looking for something more varied and rich, and is less and less willing to sacrifice scarce land for the benefit of another of a given economic function. Renewable energy sources make this increasingly feasible. Thanks to their low environmental impact and modularity, these sources allow distributed energy production, while minimizing the need to connect electricity generation plants with final demand by way of kilometers of power cables. In this, energy is a bit like tomatoes: growing them in China so that they can be eaten in Milan is something that doesn't really make any sense.
by Emanuele Elli
Translated by Alex Foti