Schneider Electric has built its multi-billion dollar business on ensuring that efficiency underpins all human activity. As Asia – its biggest region – undergoes urbanisation and economic growth, the smart use of energy will become even more important.
Asia – especially South Asia and developing countries in the region – is set to grow at the fastest rate compared to any other part in the world, according to the World Bank. As the region undergoes rapid urbanization, French power management giant Schneider Electric is eyeing three major areas with the biggest business potential: namely, energy efficiency, automation and digitization.
In the past few decades, the region has progressed “leaps and bounds” and is now in fact Schneider’s biggest source of revenue and headcount, said chairman and CEO Jean-Pascal Tricoire in a recent interview.
The Paris-based multinational that specialises in power management and automation systems has been in Singapore for 40 years, having set up its first office in the city-state in 1975. In Asia, it has been here a bit longer.
In 2014, 28 per cent of the 24.9 billion euros Schneider made in revenue worldwide was from Asia; 34 per cent of its total global staff of 167,000 is also based in the region.
“In a decade, the region has turned from a marginal part of our business to become the top region from a business point of view,” Tricoire said. “It has become very important for us.”
Driving this growth are three main engines: smart and green urbanization, industrial automation and digitization, he said.
“Those elements are very closely linked,” he said. “You can do smart manufacturing if you’ve got good digital infrastructure. And you can do smart and green cities if you digitise everything. This is what the Internet of Things (IoT) is enabling.”
By 2018, more than half of Asia Pacific’s population is expected to live in urban areas, making it the biggest challenge facing the region’s governments and cities, according to a new report by UN Economic and Social Commission for Asia and the Pacific (UNESCAP) and the UN Human Settlements Programme (UN-Habitat).
The report, ‘The State of Asian and Pacific Cities 2015’, released on October 19 noted that between 1980 and 2010, Asia Pacific’s cities doubled to two billion people and will house 3.2 billion by 2050. In China and India alone, the number of people living in cities is expected to grow by 696 million.
Meeting this urbanization challenge will require technology, Tricoire said. This means making buildings greener, delivering services more cheaply and improving energy efficiency: priorities that are aligned with Schneider’s vision as a company, he added.
Drivers of urban growth
In Singapore, the focus on smart cities – using technology to deliver better and more affordable public services–as well as energy efficiency is a huge opportunity, Tricoire said.
For instance, software downloaded on smart devices can switch appliances and lights on and off automatically when they sense the presence of people.
These machines, appliances, devices and software form the ecosystem of the Internet of Things –where software and hardware speak to each other through the Internet – can make urban systems more efficient, Tricoire said. These include water, transportation systems, gas, electrical networks – which is a huge part of energy consumption.
“So we want to apply our technology to make Singapore a more efficient city from that point of view,” he explained.
To take this a step further, the electrical systems of buildings – as well as data centres that host the smart infrastructure – can be connected to smart grids, which can detect power usage in a neighbourhood, district or city and redirect the power to where it is needed the most from areas where it is not used.
Automation has also been driving Schneider’s growth. For instance, the company has been helping factories in the region – from China to Indonesia – automate their operations because labour costs have been creeping up.
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Source: “eco-business.com”