The European Innovation Council (EIC) regularly hosts matchmaking initiatives under their EIC Corporate Partnership Programme. The EICxREPowerEU-initiative, which brought together EDP, Iberdrola, Neste & Veolia, and 15 EIC innovators, was hosted on 4 and 5 October 2022. After the event, we got together with Tomas Moreno, Head of the Innovation Ecosystem team at EDP Innovation, Oscar Cantalejo, Head of Corporate VC at Iberdrola, Antti Ritala, Head of Venturing and Acquisitions at Neste, and Catherine Ricou, Innovation Director at Veolia to provide us with a few insights on startup collaboration and open innovation.
The European Commission (EC) proposed the outline of a plan to end Europe’s dependence on Russian fossil fuels before 2030 – starting with gas. To achieve this ambitious objective, the EC is developing a REPowerEU plan that aims to increase the resilience of the EU-wide energy system while tackling the climate crisis and fast-forwarding the green transition.
In the framework of REPowerEU, the EIC Business Acceleration Services offered EIC innovators the opportunity to enhance their cooperation with large corporates and co-create innovative solutions to various pre-determined challenges launched by our partner corporates: EDP, Iberdrola, Neste and Veolia.
Can you tell us about your approach to (open) innovation and the potential challenges you face in that aspect?
Tomas, EDP: About 15 years ago, EDP changed their paradigm and we switched to an open innovation philosophy. What that means for us is that no matter how intelligent our people are, and they're very intelligent and very capable at their work, there's always someone out there that's probably better or more focused on what they are doing. The best way to innovate and to find innovative solutions is to go outside and do more of a project management orientation, where you bring in the best from various sources, whether it's universities, startups, or other companies.
Oscar, Iberdrola: We started our open innovation approach more than 15 years ago intending to look for external innovation and to have this push to collaborate with companies developing new technologies or solutions in our sector. Our approach is to be as flexible as possible to collaborate with as many companies as we can. For that, we have different tools. The main focus these past years is on companies that can help us with the carbonation and electrification of the economy and help us to lead the energy transition.
Antti, Neste: Innovation partnerships are critical for Neste. Through working together with our partners, we can develop and scale-up solutions for climate change faster and bigger. We actively cooperate with startups, large corporations, and universities to jointly develop, demonstrate, and scale-up new solutions. With startups, we do pilots, demonstration projects, and other co-operation.
Catherine, Veolia: The scale of the ecological transformation challenges that we globally face means that we must leave no stone unturned when it comes to innovation. At Veolia, Open Innovation is key to supporting us in the new solutions that are to be invented and deployed worldwide. Since 2010, Veolia Open Innovation programs support Veolia Business Units and their customers to gain rapid access to emerging and disruptive solutions developed outside the company.
Recently you teamed up with the EIC to host EIC x REPower EU. Can you explain the motivations behind joining forces with the EIC for this particular initiative?
Tomas, EDP: The RePowerEu-initiative is fully aligned with our objectives and we’re happy to be collaborating on it. As for partnering with the EIC, this relationship is long-standing and solid. We hosted a big event in 2019 in Lisbon, Portugal and continued our collaboration from there on out.
This partnership with the EIC is interesting for us for a few different reasons. Firstly, sourcing is our bread and butter. What we need is a lot of throughputs, so we can find the jewels in the lot and move forward with them. In this aspect, the EIC is very pertinent, because its companies have already gone through previous filters. Secondly, the maturity of the companies. Many of the companies can be immediately pilotable and integrated into the short-term, that’s very important to us.
Oscar, Iberdrola: We have worked with the EIC for several years. We had very good experiences and found very good companies to pilot and collaborate with. We think there is a perfect match between our vision and the EIC’s vision, mainly due to the quality of the companies and the interesting deal flow for our innovation activities.
Antti, Neste: We had a very good experience organising a Corporate Day with the EIC last year. We were very impressed with the quality of the startups participating and found concrete cooperation opportunities. The theme of this REPowerEU challenge was also very relevant to us. Our ambition is that our oil refinery in Porvoo, Finland is the most sustainable refinery in Europe by 2030. The REPower EU challenge with the EIC was a great opportunity to learn what leading startups could offer in this space and whether there could be cooperation opportunities between them and Neste.
Catherine, Veolia: With the ambition to be the global champion of ecological transformation, Veolia is committed to accelerating and expanding the deployment of solutions capable of reducing GHG emissions and driving our strategic independence. Already today, Veolia is a champion at producing biomethane from biogas, which can partly replace natural gas. The EIC x REPowerEU is a chance to support collaboration between European entrepreneurs and us to boost the implementation of the solutions needed to fight climate change and increase the resilience of our energy system.
What type of partnerships are you looking for with startups?
Tomas, EDP: After going through our initial filters, we try to bring them to our innovation domains, connecting them with the engineers so they can do an initial validation. After this, there are two ways to move forward. The first objective for us is to be able to roll out these solutions in our business units and integrate them into our business. In addition, we also have our venture capital team which accompanies the process from A-Z. If the startup is open for a round of funding, we will then assess, based on the success of our technology validation, if there’s an opportunity to invest.
Oscar, Iberdrola: We’re very flexible when it comes to startup collaboration, but I’d like to highlight three ways. The first one is an investment; we have been investing for 15 years in companies working on renewables. The second one is creating partnerships for developing or accelerating specific business units. This means that we can finance a pilot to assess the value that these solutions can have for our company and then establish a partnership with them. The third one is more geared towards looking for partners on the R&D side and other projects that we are developing.
Antti, Neste: We do joint development, piloting and demonstration projects with startups. A couple of examples of ongoing cooperation efforts are: (i) a joint pilot with Circularise, ISCC, and several large corporations on a blockchain-based approach to sustainability verification, and (ii) demonstrating Sunfire’s solid oxide electrolyser in Neste Rotterdam refinery. We can often also be an offtake customer for the first volumes from pilot & demo plants. From the investment side, we mainly look for minority investment opportunities. We can also participate in special purpose vehicles (SPVs) on capital projects
Catherine, Veolia: We believe the best partnership is a win-win partnership. We always collaborate closely with the operational and commercial teams in order to bring a real need closer to an innovative solution. A partnership with a startup will generally start with a series of tests to de-risk the solution, most preferably in operational conditions. Once the solution is validated, the business unit and the entrepreneur will define the nature of the partnership they would like to establish. It varies, and can include procurement contracts, joined-distribution, licensing, investments, etc.
Any advice/tips for companies that want to work with you?
Tomas, EDP: First, don’t forget about your team. A good idea with a bad team won't work out. An average idea with a good team can turn into something good. Secondly, come in with a clear offer. Companies such as EDP are looking for something that they can execute. Come in with an offer with a concrete solution that can be piloted. As a final piece of advice to startups, don't lose track of what your objective is. As I mentioned at the beginning, we want people that are the best at doing something. What happens sometimes is we tend to find someone good at doing ‘x’ and then we ask them to do a bit of ‘y’ and ‘z’ as well, thereby taking focus away from ‘x’. In short, stay on track in terms of what is your true differentiator on the market.
Oscar, Iberdrola: I have one main tip for companies that want to work with us: we need to have a minimum viable product that we can test, assess the value for both parties and then set up a collaboration if it is interesting for all sides.
Antti, Neste: First piece of advice is to get in touch with us. We are always keen to discuss new renewable and circular solutions for transportation & chemicals and explore partnerships. The second piece of advice is to think ahead on what you are looking for from us concretely, investor, customer, developer partner, or a combination of these.
Catherine, Veolia: I always think innovations with a higher chance of success are innovations with a very strong value proposition. So, my advice to entrepreneurs is to make sure that their products or services are very differentiating and attractive and respond to a need or a pain point for our Business Units and Customers.
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