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Skip to 0 minutes and 11 seconds My name is Gerard Van Baar. I’ve been working in the energy business since the liberalisation in 1999, 2000 when the European directive dropped in that all markets should be liberalized. My trade is especially energy trading, and the financial part of it, like what’s the value, what’s the risk of having energy electricity, yes or no, available gas. I was working for one of the big four, with international teams, in the beginning especially, focused on the Netherlands.

Skip to 0 minutes and 51 seconds The interesting thing is that the renewable energy sector back in 2000 was almost nothing and now it’s big.

Skip to 1 minute and 0 seconds At the end of the 90s there was a big thing, like wind energy, and even shell in that, there were wind and solar departments that they later on said we don’t want to focus on that. But with dot com crisis, a lot of the new companies went down, and also this was the run to renewable energies so it would get less, but then we get the carbon trading, there was a lot expected about carbon finance, for example back then I met a team about carbon trading especially, but nothing happened because carbon was so cheap, then of course it turned high in the 2005, 2006.

Skip to 1 minute and 42 seconds But if you look back renewable energies is big now, and especially in Europe because for example, the law in German that makes it possible that renewable energy whatever happens gets for a fixed price into the grid. That’s a big thing in Europe that this really could happen.

Skip to 2 minutes and 7 seconds Because the fixed-price makes it bankable, you can get it financed, and because it was bankable, you can roll-on if it comes to you. So that’s was very good. It also shows also that you need regulation to change. And regulation, in some ways, needs to be in the front of change to make things possible. But in general, we say, the law is always looking behind.

Skip to 2 minutes and 36 seconds And also now if you talk about smart cities, if you see in Holland for example, but also in other countries, when you’re thinking about a new business concept, nine out of ten times you run into regulations that were written in a time there was one producer that served you as a consumer and people never thought that there could be more. That you as a consumer could have energy from different producers, or that you do it yourself.

Skip to 3 minutes and 12 seconds The starting point is that because there is a grid and even if you don’t use it but you have the ability to use it, as a sort of rescue, that in itself you have to pay something. Whether that is to a company or it’s to the government who pays the company, but something should be arranged there.

Skip to 3 minutes and 35 seconds If you think about the start-up, especially for a smart grid like servers, the first thing is that you thought about the business concept, you thought about what you want to sell, you thought about the service. And of course it’s always difficult if it’s completely new, people cannot imagine that they need it. You should find some sort of population you can focus on that you can say this to, you should prove your point, people would like it, would buy it. From day one you need somebody that will back you up.

Skip to 4 minutes and 12 seconds For example in Holland, one of the producers, or even two of them, have funds, funds for energy start-ups and it makes life so much easy, but still you need to have a good idea but you don’t have to start from nothing, because they know exactly what are all the energy questions in the energy land. The most important thing is whatever if you are in a company or you’re a start-up, first of all, people very much look at technical part, is it possible yes or no. And if they think about the service they want to know if people want to buy the service, yes or no.

Skip to 4 minutes and 52 seconds And what you see, that this I think is a European thing, compared to America, if you start up, if you think about it, you also should from the beginning think about the business concept. How can we make money with it. Smart grid innovations that we think about and talk about for example regulatory wise are very difficult, so for example the energy law in The Netherlands, but for the most countries are written from the perspective of a central producer that delivers energy to one consumer, and this one consumer has one producer delivering to him.

Skip to 5 minutes and 32 seconds The law was never meant, that you can choose and that switching off is now possible, but not that you have several producers at the same time and also not for all. In Holland for example, this year we’ve got an hourly tariff. All these kind of things that the law must give room to them and if it does not have then,

Skip to 5 minutes and 54 seconds for example in Holland who can ask to be labelled as an experiment.

Meet the expert: New business models for a new energy industry

Gerard van Baar, Director at Van Baar Consultancy, is a specialist on energy trading. In this interview, he will offer insights for start-ups in the energy industry and describe some of the main upcoming business models.

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This video is from the free online course:

Smart Grids for Smart Cities: Towards Zero Emissions

EIT InnoEnergy