The Future of Electricity
Innovate or die. In this concise phrase, Ernesto Ciorra describes the sense of the mission he's carrying out at ENEL, the Italian electrical utility. Ciorra, Bocconi Class of 1996 in Business Administration, is the company's head for innovation and sustainability: "On the front of innovation, my task is to help the company innovate in all aspects, from those purely technological, to those more related to human resources and communication," he explains. "In terms of sustainability, we study the needs of the communities in which we operate, according to the principle that if our company makes money, it also has the responsibility to return something to the local community."
➜ Is this the concept of creating shared value?
Exactly, to create shared value. Both on sustainability and innovation, ENEL is considered best practice in two different case studies made at Harvard and Berkeley. In its list of companies that are changing the world, Fortune magazine has ranked us 20th this year.
➜ What are the points you are focusing on to innovate?
First, on startups: we studied 1,800 of them, met 500 and made projects with 90 of them. We have entrepreneurial hubs all over the world to develop their activities, from San Francisco to Santiago in Chile, from Tel Aviv to Madrid and Catania in Sicily. We do technology support, help them find funding, test products, and do market launch. In exchange, we have access to the services and technologies they develop before the competition. Second, we cooperate with world players such as Toyota, Nissan and Byd (which, as few might know, is the world's largest electric mobility player, even bigger than Tesla) and collaborate with the world of scientific research. On the latter front we have partnerships with Columbia, MIT, Berkeley, the Polytechnics of Milan and Turin, and Bocconi University, the only non-technology academic institution we have dealings with. And then there is innovation that comes from relationships with suppliers, customers, and our own employees: we recently organized an Innovation World Cup which saw 144,000 man-hours dedicated to the development of employee startups.
➜ The future of electricity lies in storage and hence the attendant risk of scarcity in the raw materials needed for making batteries. How do you see the issue?
The issue of electricity storage is not a problem, but a huge opportunity. I am convinced that battery technology will change in a way that will have less need for rare materials in the future. Many large companies have the ability to invest massively in R&D in this field. Nissan, for example, is investing $2 billion to develop electric cars. For example, I see a future in what could be called organic storage, by using biological rather mineral components. Electricity can already be generated from vegetable plants today, it is not far-fetched that in the future energy can be stored in similar ways.
➜ Let's go back to the concept, summed up by your professional title, that innovation goes hand in hand with sustainability.
If you do not innovate, you become unsustainable, and if you are not innovative and sustainable, your business shuts down. And this applies to all companies.
➜ How do you see the future of Italy from the point of view of innovation?
I see Italy well positioned, because in the electricity industry, we are the only country in Europe to have a fully digital electric grid, thanks to the investments made by ENEL. It means that the network allows remote control and is bidirectional, that is, it not only provides electricity to users, but can also receive energy from small power plants. The challenge for the future is to build ever new sources of value on the basis of assets that we have. However, as far as the general technology infrastructure of the country is concerned, Italy needs to eliminate the digital divide in terms of generalized access to broadband Internet service.