INTERVIEWS

Ján Porvazník: We Should Treat Environmental Sustainability As A Public Good

Jan Porvaznik

Ján Porvazník is a Market Development Manager at E.ON. His day-to-day job consists of strategic and tactical tasks that include scanning the market for business opportunities, looking for potential customers, analyzing policy landscape dictating short-term and long-term market outlook, estimating the timing, size and risks of these opportunities, and ultimately recommending where E.ON should build their next renewable assets.

In the interview, we talk about his journey from Bratislava through Berkeley to Chicago, about his studies, his ideas in renewable energy and sustainability, the differences between the energy business in Europe and USA, crypto companies, and much more.

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Ján, what was your journey from the University of Economics in Bratislava to Senior Market Development Manager at E.ON in Chicago?

When I started my studies at the University of Economics, I didn’t have any idea about what an ideal career looked like. I remember wanting to do something that would be beneficial for the society in the long run.

When I went to France to finish my university studies, I met a professor who was very passionate about corporate sustainable development. His passion was so contagious that I quickly became interested in and fascinated by the subject. It happened to be the time when the EU started implementing many sustainability related measures one of which were renewable energy standards and subsidies. I started expanding my knowledge in the field, took on more energy-related coursework and went to Finland to spend some time with my thesis mentor, Professor Peter Lund – one of the thought-leaders on renewable energy transition in Europe, who helped me with my work on venture capital in the energy sector in the EU.

What followed after the studies?

I worked in consulting for a few years from where I moved into the energy industry. I worked for the top executive management at Enel in Slovakia where I further improved my understanding of the industry and got an insiders-view into immediate priorities of large power utilities.

I became very passionate about the challenges the industry was facing and wanted to be at the forefront of solving them. This passion got me to University of California in Berkeley, where I spent two years working on cutting-edge research and problem-solving exercises that all had one big purpose – to help force the shift from a dirty to clean energy future by using evidence driven and practical research.

How do you recall the experience at a research lab at the University of California in Berkeley?

Being at Berkeley is like drinking knowledge from a fire hose. Every day you are exposed to new ideas. Every day you meet people that work on unprecedented problems providing intelligent and interesting solutions. Every day you challenge your imaginative boundaries.

Not only did I deepen my passion for energy but, more importantly, I got to meet truly inspirational and dedicated people that through their everyday work help changing the world we live in. I would say that my time at Berkeley was definitely a momentous part of my professional life.

Where do you see the most acute problems of our environment and what is your take on the way we as a global community are trying to solve the issues?

I think the main problems that we as a mankind face in terms of sustainability have been already very well defined. Topics like climate change, air pollution, deforestation, migration, poverty, energy access, etc. already have a good global support and research coverage. They all have impact on our health and well-being.

There are a few lenses that you can use to look at these issues. I look at it from the energy perspective. For example, it’s still quite unbelievable that almost 1.2 billion people on this planet don’t have access to basic services such as electricity, heating or cooling. The paradox is that we’ve been trying to find advanced solutions for technological challenges related to electricity and motorized transportation for decades. However, in the process, we forgot to pay more attention to more mundane topics such as the one I just mentioned. I think we should treat environmental sustainability as a public good; that’s where our focus should be.

Ján Porvazník

What startups and technology companies do you see doing great in the field of sustainable energy?

On the technology side, I’ve been most intrigued by companies striving to improve the energy storage solutions such as Wattsun or Skeleton Technologies in Europe and Energy Storage Systems in the US that are using different chemistry types to improve energy density of batteries, or Voltaiq which is a powerful software solution helping optimize battery architecture and thoroughly analyze and optimize the productive use of batteries.

In the energy world, as very much in any industry, the technology alone is not enough. It is important to use the technology and build solutions around it and create innovative business models to implement and deploy it. It is why I believe that the biggest breakthroughs will come from business model innovation. Let’s take the solar energy in developing countries as an example. As I mentioned earlier, it’s almost unbelievable that there are still about 1.2 billion people without access to electricity.

Companies such as Off-Grid Electric, D.Light, M-Kopa or Power Hive are helping to close this gap by harnessing a decade old or even older mature technology packaged in an economical and practical solution – such as a mini-grid platform and selling it to customers using innovative business models, such as pay-as-you go plans. The innovation there is that they simply make it affordable and easy to use.

As far as I know, you have also been interested in crypto companies.

That is true. I have been intrigued by companies involved in big data and cryptocurrencies. Believe it or not, this is an area where energy plays a fundamental role. Mining cryptocurrencies such as Bitcoin is a very energy-intensive process. This is why many energy companies are looking into starting their own bitcoin farms or even their own cryptocurrencies. An interesting concept that I think might materialize with the rise of blockchain are more “green transactions using green cryptocurrencies”. Blockchain can help track and manage environmental performance of companies and use the information about energy or natural resource savings, or green energy production in valuing financial and other transactions between companies and individuals.

You are an advisor for InnoEnergy, a knowledge and innovation community by the European Institute of Innovation and Technology, a research and development agency of the European Union. What is your role and how do you see European innovation in sustainable energy?

InnoEnergy is a very important piece in the European innovation puzzle. The organization seeks to spur interdisciplinary energy research activities and entrepreneurship across Europe. Their goal is to provide support for research labs or startups in form of expert advisory and financing and thereby help the startup community and by analogy also the innovative competitiveness of the EU economies grow.

The team at Neulogy has been recently appointed to lead the Slovak chapter of this organization. I’ve joined this initiative as an advisor providing ideas for development of their activities in Slovakia and also as a mentor for startups that are involved in the program.

Photo by Karsten Würth on Unsplash
Photo by Karsten Würth on Unsplash

You also mentioned quite a bold idea of households being paid for their energy savings. How did you come to that proposal? What are the reactions from people you talk to about it?

Actually, it is a very realistic concept. It is all about avoided cost and finding cheap and more convenient ways to make our resource consumption sustainable. There is a lot of companies out there that are trying to figure out ways to make sustainability both comfortable and valuable for their customers and create business models that will make it an interesting business for them.

The rationale for it is quite simple. Energy is a costly commodity – there is a long list of inputs that go into 1 MWh of electricity or heat – generation technology, sometimes fuel, transmission and distribution wires, transformers, substations, etc. Requirements for these inputs have been growing proportionally to the global population growth. By the same token, the costs have been growing, too. To make this dynamic more sustainable, the energy companies and policy makers started thinking about new ways to improve the power system not only on the input or infrastructure side but also on the output or consumer side.

Today, the improvements on the infrastructure side can be planned with very high accuracy but are also very costly. On the consumer side, however, we’re seeing a lot of untapped potential, such as people willing to defer their consumption at certain times for a reasonable compensation or savings on their energy bill. This compensation can be often lower than the cost it would take to build and maintain new additions to the infrastructure. All in all, human behaviour in this sense is a commodity the same way energy is – just a lot cheaper…and there is a value we can create around it.

If you compare the energy business in Europe and USA, what differences and similarities do you see? What can we here, at the heart of Europe, learn from the USA?

First of all, both the European and the US energy markets have gone through some fundamental transformations that helped rationalize the use of the energy infrastructure and introduce innovative and cleaner elements such as the renewables, demand response or smart grid technologies. The main difference is maybe in the way these changes were implemented on the two continents.

First, in Europe, we were able to ramp up renewables by imposing aggressive targets and introducing pretty substantial subsidies. This approach on one hand led to important lessons learned and technological leadership but on the other hand resulted in high power prices that ultimately hurt the customers.

In the United States, we’ve witnessed more competitive process of introducing renewables into grid. Instead of hefty feed-in tariffs, the federal government decided to support renewables through tax credits, a mechanism that essentially allows investors to deduct a certain portion of investment from their tax liability. At the same time, certain states imposed mandates for utilities to reach predetermined share of electricity from renewables on their total retail sales. Overall, the procurement process for renewable energy is done in a more competitive way where the renewable developers, such as my company, have to bid competitively to earn contracts. The contracts are awarded to lowest bidders which makes the adoption of renewables less expensive and more interesting from the business perspective. We’re slowly seeing this approach gain traction in Europe as well.

Second difference is that the US now has vast and cheap gas reserves that are an important complementary resource to the growth of renewables. The gas power plants are used to produce energy when the wind is not blowing or the sun in not shining. The cheap resource in the US has led to an important growth of these “back up” power plants. In Europe, we’re still dependent on the gas from Russia economics of the infrastructure rebuilding all the more difficult. Overall, we may say that the above-mentioned aspects make building of the clean energy platform in the United States much cheaper and faster. We may also argue that development and adoption of services and products on top of this platform, such as electric vehicles, smart grid services, etc. will be cheaper and faster on the western side of the Atlantic. But it may also turn out to be the other way around. The lack of cheap resource could and should be the paramount driver for Europe to embrace sustainability and reclaim the position of innovation leader in the energy sector.

Jan, you are going to become a contributor to the Slovak STARTUP guestblogs. What topics will you be covering? What can we look forward to reading from you?

I would like to share with the readers my views on the new tech disrupting the energy industry. I plan to touch on topics such as the role of cryptocurrencies and blockchain in driving growth and a smarter energy grid development, or developments in the realm of electric vehicles and battery storage. I also plan to share more “philosophical” pieces on how to unlock a greater use of clean energy and my views on new business models transforming the way we produce, sell and consume energy.


Photo: Ján Porvazník

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