Energy - 2020 General Overview
Priorities in 2020
COVID-19 Pandemic and Measures Taken
The COVID-19 pandemic, quickly spreading across Turkey and the entire globe, once again demonstrated the critically important and essential work performed by energy sector employees. To ensure the continuity of electricity generation and distribution, which power the Turkish economy and everyday life, Enerjisa Enerji and Enerjisa Üretim worked tirelessly during this pandemic year.
Even before the pandemic, employee health has always been a top priority at Sabancı Holding. During this extremely challenging year, both Energy Group companies implemented a wide range of preventive and precautionary measures to combat COVID-19. Enerjisa Üretim obtained the TSE COVID-19 Safe Production Certificate for all its power plants and its headquarters office.
Increasing Network Investments
In 2020, Enerjisa Enerji recorded grid investment spending of TL 1 billion 790 million, up 26% y-o-y compared to the previous year. Thanks to these investments, customers were provided with sustainable solutions that make their lives easier. With the support of its strong balance sheet, Enerjisa Enerji plans additional grid investments to ensure an uninterrupted energy supply in the future.
Sustainability is a strategic priority at Enerjisa Enerji. Toward this end, the company focuses on conventional network and customer operations technologies such as SCADA, GIS, OSOS. Enerjisa Enerji capitalizes on a wide range of advanced technologies, including advanced data analytics, robotics and artificial intelligence. In addition, Enerjisa Enerji invests in innovative solutions such as e-mobility, on-site generation with renewable resources and storage.
Preparing for the New Implementation Period (4th Tariff Period)
In 2020, Enerjisa Enerji commenced preparations for the new implementation period. This is when the income requirement parameters of the electricity distribution and sales industry, especially investment and operational expenses, for the next five years will be determined. Preparing for the new implementation period was one of the company’s most important agenda items during the year.
Enerjisa Enerji completed preparations for the five-year master plan to provide customers with the highest quality service possible. The master plan covers key areas including expanding the grid, upgrading the existing grid, investing in technology and conducting R&D. In addition, Enerjisa Enerji was committed to prepare for this new period in the best possible way in collaboration with its stakeholders. The new tariff period commenced with the support of Enerjisa Enerji shareholders and in accordance with the company’s strategic plans.
Enerjisa Enerji provides an indispensable service to about 22 million people in its operating region. At the onset of the pandemic, the company quickly set its top priorities: safeguarding human health and ensuring an uninterrupted energy supply. In 2020, Enerjisa Üretim reached the highest availability level in its power plant portfolio with five different technologies. As a result, Enerjisa Üretim reported record high energy generation in 2020. Thanks to the successful efforts of crisis management teams at both companies, Enerjisa Enerji and Enerjisa Üretim exited this highly challenging year with performances well beyond expectations. Understanding that a crisis cannot be managed during the actual crisis, Enerjisa Enerji and Enerjisa Üretim closely monitored and implemented the precautionary measures announced by the Ministry of Health and the World Health Organization. Great effort was shown at both companies to ensure that their respective services are provided in an uninterrupted and sustainable way.
Turkey’s Largest Sustainability-Linked Loan Deal
In 2020, Enerjisa Üretim further bolstered its energy portfolio with its sustainability-linked loan deal amounting to EUR 650 million. Seven banks participated in the transaction. With this major lending facility, Enerjisa Üretim reduced its total debt while providing support future renewable energy investments that are planned to be commissioned in the near future. Thanks to its solid financial structure, Enerjisa Üretim has met the conditions necessary to distribute significant dividends to shareholders.
A Growing Generation Portfolio Focused on Sustainability
Enerjisa Üretim aims to further expand, enrich and diversify its operations in the future with the following activities:
- Expanding its renewable portfolio with YEKA projects.
- Establishing Enerjisa Europe to take its commercial activities in the European market to the next level.
- Transforming its trading experience to create value in foreign markets by obtaining electricity trading licenses in Bulgaria, Romania and Serbia under Enerjisa Europe.
- Introducing a new business model with the commissioning of SENKRON, a control room capable of controlling power plants with different electricity generation technologies at the same time – a first in Turkey. SENKRON currently controls all 12 hydroelectric power plants in Enerjisa Üretim’s portfolio. SENKRON also features a control infrastructure that enables access to the control and monitoring systems of thermal, wind and solar power plants in Enerjisa Üretim’s portfolio and those owned by other companies. Thanks to this network, SENKRON conducts performance and status monitoring of power plants with an analysis infrastructure where thousands of pieces of data are monitored online.
Performance in 2020
Digitalization, Technology and Investments
In 2020, Sabancı Energy Group moved forward with its comprehensive digitalization transformation with the technological support of Information Technologies. No workforce loss occurred during the pandemic thanks to infrastructure modernization and upgrades that support operation independent of location.
Enerjisa Üretim further developed its advanced technology infrastructure to add value in diverse areas including processing of sensor data collected from the field, performing trend analyses and especially, conducting predictive maintenance. Efforts to replicate key applications in trade and power plant management to be compatible with cloud environments are nearly complete. Sabancı Energy Group has started to enjoy the flexible, manageable and stable platform advantages of cloud technology. Thanks to investments in augmented reality, Energy Group ensured that operations between power plants and external suppliers are performed remotely and without any loss of functionality and labor. In 2020, Sabancı Energy Group operations continued without interruption despite pandemic travel/visit restrictions thanks to technology solutions. In addition to IT digitalization roadmaps, Energy Group started to develop Digital Journey Maps in line with the needs of each business unit. Over 70 applications were developed and implemented using these maps. Numerous applications that differentiate Enerjisa Üretim in the market were also developed during the year.
Beyond conventional investments, the new emerging energy world prioritizes innovations such as distributed generation, storage, e-mobility and digital customer solutions. Enerjisa Enerji consolidated its technology and sustainability-oriented customer solutions under the banner of “Energy of My Business.” Eşarj provides environmentally friendly solutions such as SPP, LED lighting, certified green energy, solar and cogeneration to its customers. Regarding its product offerings, Eşarj set its sights on 2030 in the short term and 2050 in the long-term.
Enerjisa Enerji sees significant value in leveraging external agile and entrepreneurial structures from the entrepreneurship ecosystem and a complement to internal corporate resources. To this end, Enerjisa Enerji adopted an entrepreneurship ecosystem that will inject dynamism into the company. This ecosystem is supported with “Nar,” its in-house entrepreneurship program, and “İvme (Acceleration),” a program commissioned this year.
The fast-growing electric vehicles market will play a major role in the future of transportation around the globe. Currently, there are 2.5 million hybrid and electric vehicles on the world’s roads. This figure is projected to rise to 50 million by 2030. Today, Enerjisa Enerji is planning investments that respond to the expected higher demand on the grid and expand its charging station network. Moving forward with this vision, Enerjisa Enerji acquired a majority stake in Eşarj in 2018. Eşarj continues to grow steadily every year. With a 186 public station network featuring 320 sockets, of which 109 are fast charging, Eşarj boasts the first and fastest station e-charging network in Turkey. Thanks to its electric vehicle charging stations, Eşarj is expected to help reduce carbon emissions by 2.5 million tons by 2030 due to the decrease in conventional cars on the roads.
2021 Priorities and Industry Strategy
Sabancı Energy Group executes its operational excellence strategy to achieve sustainability. In the coming year, the negative effects of the COVID-19 pandemic are expected to subside with rollout of mass vaccination campaigns. As a result, energy industry demand and dynamics are projected to normalize. With this forecast recovery, the Turkish energy sector is expected to grow in parallel with the country’s GDP growth. Sabancı Group remains committed to integrating sustainability into all its business operations and monitors global developments in this arena. Energy Group companies are also working to integrate sustainability into their operations, systems and processes. That same synergy is expected in Sabancı Energy Group’s partnership with E-ON, one of Europe’s biggest energy players, for a successful year focused on growth opportunities.
Enerjisa Enerji and Enerjisa Üretim anticipate further liberalization for Turkey’s energy industry. Expecting a more stable investment environment in 2021, Enerjisa Enerji and Enerjisa Üretim plan to maintain their appetite for growth in line with market developments.
Enerjisa Enerji and Enerjisa Üretim aim to commission the Future of Work initiative and develop a roadmap on the efforts and modifications to be made going forward.
Enerjisa Üretim plans to implement stateof-the art solutions for price prediction, predictive maintenance and optimization models in data analytics. Enerjisa Europe’s active trade volume will be maximized in accordance with market conditions. As long as the market environment permits, Enerjisa Üretim aims to engage in efforts to boost natural gas sales and expand the portfolio volume in terms of electricity last resource supply. Other objectives include developing customer-oriented solutions that will maximize national benefits during the transition to a green economy by closely monitoring international green and carbon markets. To meet the changing needs of customers, efforts are ongoing to include comprehensive internally recognized emission and clean energy certificates in Enerjisa Üretim’s growth journey.
A new implementation period encompassing the years 2021-2025 will start in the Enerjisa Enerji distribution business. Investments in the grid, technology and customer satisfaction are scheduled to continue according to the new master plan. Investment spending is expected to increase in 2021 compared to the previous year.
Enerjisa Enerji’s sales business aims to expand service diversity in both physical and online channels. During the pandemic, online channels in particular rose in importance. Enerjisa Enerji also plans to further develop user experience in the sales segment. By launching next generation products - distributed generation, productivity and e-mobility - under the brand “Energy of My Business,” Enerjisa Enerji aims to raise its profile as customer solution partner in these emerging areas.
Sabancı Energy Group companies plan to maintain market leadership where they operate while pioneering the industry’s development in terms of growth, productivity, competitiveness and corporate identity.