Güler Sabancı, Chairman of Sabancı Holding, Gave a Speech at The 23th World Energy Congress

14.10.2016

GÜLER SABANCI: "ENERJISA IS THE LARGEST PRODUCTION AND DISTRIBUTION COMPANY OF TURKEY AND THE REGION"

Güler Sabancı, Chairman of Sabancı Holding, addressed delegates from all over the world in the 23rd World Energy Congress and called for unity for a better energy future. Mrs. Sabancı emphasized the importance of energy liberalization during her speech in the Istanbul Congress Valley.

Güler Sabancı started her speech by thanking the participants and recalling the International Day of the Girl Child. Mrs. Sabancı said: "I would like to start with an issue that is as much vital as energy efficiency, energy supply, climate change and other issues that we will discuss throughout this conference. Tomorrow is the 11st of October, the United Nations International Day of the Girl Child. Today, there are 1.1 billion girls around the world. I believe that the power of these girls will pave the way for a sustainable world that is better for everyone. As in every part of life, we need decision-maker and professional women in each level of the energy industry. I ask everyone here today to open the doors for women.

For the role of Turkey in the energy industry, it is of capital importance that you attend in this meeting during which we aim at developing accurate and appropriate strategies for the energy industry and creating significant opportunities. The energy demand in the world was equal to 6-7 billion tons of oil in the 70s, when this congress was held in Istanbul. This demand has doubled since that day and reached a level that is equal to 14 billion tons of oil in 2015. The global energy growth has reached very remarkable dimensions. Today, I am here to speak to you as the chairman of a holding which believes in the future of Turkey and the potential of the energy industry. I believe Turkey has a positive and highly successful exemplary reform program in the energy industry. This was achieved thanks to the effective leadership of the Ministry of Energy and Energy Market Regulatory Board. In the past 10 years, 70 billion dollars have been invested in the privatization of the energy production and distribution with energy production capacity. We, as Enerjisa, have carried out 11 billion dollars of this investment together with E.ON, our business partner. We reach 9 million consumers in 14 provinces and provide electricity production and distribution services to almost 20 million users. I am very proud that Enerjisa is the largest private capital electricity production and distribution company in Turkey and in our region.

We believe that the efficient liberalization of the energy market and competition is the key for providing the required capital to the economy

The production capacity has tripled in the last 15 years. Turkey has overcome and moved beyond the strong growth in energy demand. Electricity supply is much stronger than it was 8 or 10 years ago. I may be repeating what the Esteemed Minister and other speakers said before, but I think it is beneficial to highlight these one more time. The distribution sector has completely been privatized. Privatizations provided considerable benefits and increased the investments. However, Turkey should still invest in the energy industry, and the electricity and natural gas markets must be liberalized to mobilize this investment. For the long-term, the liberalization of electricity and natural gas markets must be our most important goal. Along with the liberal natural gas market and the growth of trade, Turkey has the potential of becoming the commercial center of natural gas. It also applies to electricity, which will be possible with much wider interconnections and improved electrical exchange market conditions. Energy policy, legislators and leading them correctly constitute the basis for a sustainable energy industry. Turkey has a very active leadership, a young and dynamic population aware of the climate change and sustainability, and the population is open to new technologies. We have a strong growth potential and players willing to act in the energy industry. We are on the right direction for a safer, competitive, and sustainable energy industry.

During this change in the energy industry of Turkey, the world has also undergone a remarkable change and the rules of the game are changing as well. The only thing that we are sure about the future is that it will be different from yesterday. The game will be based on "demand" in the future, whereas it was found on "supply" in the past. The energy demand is a function of the economic growth, social development, urbanization, and electrification. Urbanization, climate change and women’s participation in the economy are strong trends that affect the energy industry.

Nearly 50% of the world's population live in rural areas today. More than 15% have no access to electricity. Offering modern energy solutions to billions of people is one of the most important challenges of this century. The estimations tell that in 2040, the world will consume 50% more energy than it consumes today. A well-balanced and diversified energy package should be offered to meet the increasing demand safely and efficiently. We must ensure substantial investments in each segment of the energy value chain to deliver and use energy safely and competitively. We believe that efficient liberalization of the energy market and competition are the keys to provide required capital for the economy. Climate change is a global trend that determines many things, and the energy industry stands at the center of all steps to be taken when it comes to addressing climate change. In this context, the Paris Agreement, a political act that aims to provide international harmony, was a very important step to reduce the negative effects of the climate change. In the future, we will need better global cooperation, better policies and we will need institutions such as International Energy Agency to be more active.

Another issue that needs to be addressed should be the global energy efficiency It has a key role for both climate change action and sustainable development. According to a recent report, 28% of total infrastructure investments for the next 15 years, i.e. about 25 trillion dollars, is estimated to be in energy. Furthermore, the investments in energy efficiency constitute nearly the same amount or more. This certainly requires the financial institutions to provide more capital flow for energy efficiency, and policy makers should also take this issue into consideration.

A sustainable energy infrastructure provides triple gain: supports the growth, reduces the greenhouse gas emissions, and improves energy access while popularizing it. This highlights the importance of technology more than anything. Despite all the hardship, opportunities are in front of us.

We can create a better energy future together

There are many innovation areas for a developed energy system in the future. We are all witnessing the strong growth in sustainable energy. Significant technical developments and cost reductions have been achieved in all renewable energy technologies recently. Although we believe that this trend will continue, successful integration of renewable variables in the energy grids will become more important in the future. This will create a significant innovation area: small-scale but more efficient and flexible production. The future energy system will be decentralized but also connected.

The distributed energy production is indispensable for efficient conversion of today's energy systems which direct us to smart networks, buildings, and cities. Internet of things will be more prominent in the energy industry. We will see that digital and mobile technologies will dominate many areas from energy generation to transmission, distribution, and supply.

Turkey is a young country and these young people want to be connected: their desire for new technologies, willingness to connect, consumption of mobile technology encourage us in their demand for everything that is ‘smart’. As one of the largest electricity companies in Turkey and the region, we see great opportunities here and of course, we are aware that we have a huge responsibility. I have no doubt that we will fulfill this responsibility.

As we all know, exciting and even shocking technological developments such as energy storage and new battery technologies, electric vehicles, the effect of high-capacity batteries on the transportation industry, options for carbon emission and storage are on the way. These developments show us that renewability and energy efficiency are not the only tools for achieving more sustainable and less carbon-heavy energy industry.

The storage of energy can change the dynamics completely. Innovation from production to delivery and from distribution to end-use, intelligent demand management with new technologies, innovative market design supported with digital and mobile technologies, and ‘pro-sumers’, i.e. consumers who are the producers, will offer us a more competitive and productive future. We will see the growth of consumer and customer-oriented approach in the future. Of course, this situation will create the need for human resources with different skills and profiles in the industry. For this reason, we now have a new post-graduate program called "Energy Technologies and Management" at Sabancı University. The energy security will continue to be an important factor for energy policies. Energy security policies and various regional dynamics will play a role in the energy conversion of each country.

The future is full of opportunities as well as many uncertainties and challenges. I believe that those who allocate resources for new ideas and new technologies will win. Countries and companies that work for more efficient energy will also be among of the winners. If the players in the market can meet the ever-increasing needs of the consumers in a timely and efficient manner, they will win. However, we can all win with a global approach, global policies, global institutions, and global companies.”

Mrs. Sabancı finished her speech with a call: “We can create ‘a better energy future’ together!”