War in Ukraine highlights need for fuel source security
As a response to the unreliable natural gas supply due to the war in Ukraine, we are fast tracking our Natural Gas Fuel Switch initiative. This fast track will accelerate our journey from natural gas to alternative renewable fuel sources, with specific attention to vulnerable sites within VELUX.
The switch to renewable energy originally began in March 2022 with the global roll-out of our Energy Excellence Program for our factories. Initially the pilot was set to be tested on two of our major sites Poland (NM-PL) and Germany (JTJ-D) and focus on optimisation, energy savings and sustainable fuel sources. However, the instability caused by the invasion of Ukraine introduced new risks to the original timeline and pushed us to create a fast-track agreement with the main focus on sustainable fuel. “We were already dedicated to reducing our carbon footprint, however the war in Ukraine has highlighted and created a new vulnerability through our reliance on natural gas. We are now fast tracking the initiative and prioritising locations with the most immediate need for alternative sustainable solutions,” says Kim Jonas, Director, Global Energy & Climate. This new agreement allowed us to address the risks posed by our current situation and elevated Slovakia (PBC-SK) to the top of the evaluation list.
Our current situation
The volatile energy market results in extremely high gas prices and increases our overall energy cost and lowers the payback time for alternative and sustainable solutions. The uncertainties due to the war in Ukraine and unreliable gas supply make it difficult to project the supply of gas in the European market. We’re facing an unpredictable supply of renewable heat technology due to competitive demands from companies that have similar plans to implement renewable technology
Our fast-track priority One of our most at-risk factories is PBC-SK in Partizánske, Slovakia. Less than 400km from the Ukrainian border, PBC-SK is a fast-track priority due to its current dependency on natural gas and subsequent vulnerability in the event of a natural gas shortage. “When we compare VELUX sites, we are vulnerable because we do not have any alternative energy solution. Natural gas is our main energy source and if our supply gets cut off, as in Poland and Bulgaria, our production stops,” says Juraj Michalík, General Manager at PBC-SK.
To put that into relatable terms, 6000 megawatt hours is equivalent to the consumption of about 250 domestic households using gas as fuel for heating (in northern Europe).
Currently, PBC-SK runs 100% of its production on natural gas. In total, PBC-SK uses about 6000 megawatt hours of natural gas each year: 50% for production and technology and 50% for facility heating. Over the summer months, as PBC-SK’s heating needs drop, so does their gas usage. However, whether it is heat for production processes or providing employees warmth and comfort, a stable energy source is still needed to operate. “My hope is that the fast track provides viable advanced technology energy solutions. It is easy to feel pressured into choosing the quickest and easiest solution, but I am quite confident we can find an alternative energy solution that is both cost efficient and sustainable,” says Juraj Michalík, General Manager at PBC-SK.
Possible alternative energy sources used to support the fuel switch to renewable heating could include bio boilers, heat pumps powered by renewable electricity, geothermal heating, etc.
PCB-SK’s Future Schneider Electric will visit PCB-SK over the Summer 2022 to begin the fast track’s evaluation process. We will be working closely together to focus on the optimisation of our heating infrastructure and replacing natural gas with other renewable energy sources. "It’s important that we work closely together with Schneider Electric’s dedicated experts and use the fast track to narrow our energy focus into the natural gas supply. By initiating this fast track, we will be able to accelerate the timeline for fuel switch by up to a year on the most vulnerable production facilities in Europe,” explains Christian Jakobsen, Senior Energy Manager, Global Energy & Climate. Once the needs of vulnerable sites are addressed, Schneider Electric will identify each of the additional pilot PCo’s heat demand and heating system infrastructure, provide a solution catalogue of alternative solutions as well as market research on renewable fuel sources.