Innovation

Naturgy is a pioneer in biomethane technology, with over 60 biomethane projects in various stages of development. Additionally, Naturgy is incorporating innovative renewable energy solutions through its global portfolio of wind, solar, and battery storage projects. Innovation at Naturgy also extends to digitalization and grid transformation. The company has invested heavily in smart grid technologies to support renewable energy integration, ensuring energy efficiency, and security of supply.

Overall, Naturgy’s innovation strategy is centered around transforming the energy landscape through significant advancements in biomethane production, renewable energy, and grid modernization. This multi-faceted approach addresses pressing environmental challenges while promoting sustainable growth. The Naturgy Group is innovative in more ways than one, setting a global precedent. The company has become a pioneer in its effective fields as it has set the stage for effective diversity, sustainability, inclusiveness, and renewable energy.

Naturgy’s innovation strategy focuses on pioneering sustainable energy solutions through biomethane production, renewable energy expansion, and smart grid technology. By leveraging cutting-edge research and partnerships, Naturgy aims to transform the energy sector and contribute to a low-carbon, circular, sustainable, and renewable economy.

One of Naturgy’s key innovations is its biomethane production initiative. Biomethane, a renewable gas derived from organic waste, holds a substantial role in Naturgy’s sustainability strategy. Naturgy captures biogas from sources like agricultural residues, livestock waste, cow belching, and wastewater treatment plants. Naturgy then enriches this biogas to produce biomethane, which can be seamlessly integrated into existing natural gas infrastructure (Naturgy has also innovated its infrastructure). 

Currently, Naturgy is leading the biomethane sector in Spain, with over 60 projects in various stages of development. One of the company's projects is their Vila-sana plant in Lleida. Vila-Sana is projected to begin injecting biomethane into grids by late 2024. This plant alone is expected to supply energy for 3,000+ homes annually. Hence, reducing CO₂ emissions by approximately 2,000+ tons each year. These projects not only contribute to carbon reduction but also support a circular economy (transforms waste into energy).

In addition to biomethane, Naturgy is heavily invested in renewable electricity generation, with a focus on wind and solar energy. In 2023, Naturgy introduced the 7v Solar Ranch in Texas, a 300 MW photovoltaic plant capable of generating 560 GWh of clean electricity annually. This solar farm represents Naturgy’s introduction into the U.S. renewable market, marking a significant step in its global expansion strategy. In Australia, Naturgy continued its renewable energy push with the BerryBank II wind farm, which, along with 10 MW of battery storage, enhances grid stability by providing reliable, dispatchable power. These projects demonstrate Naturgy’s dedication to scaling up renewable energy capacity, which now represents 37% of its total generation portfolio.

Naturgy’s commitment to innovation extends beyond energy production. It includes smart grid technology and digitalization. The company is implementing advanced grid technologies to support the integration of renewable energy sources and enhance energy efficiency. By using data-driven insights and automation, Naturgy’s smart grids enable efficient energy distribution, improved grid reliability, and optimized resource use. This grid transformation is essential for accommodating intermittent renewable sources like wind and solar, ensuring a steady and secure energy supply. The company’s research partnerships, such as with the Catalonia Institute for Energy Research (IREC), further exemplify its innovative spirit. Together, they are developing advanced methanation technology that converts organic waste into biomethane using green hydrogen. This will further improve the production and efficiency of renewable energy. This pioneering project not only contributes to decarbonizing the natural gas supply but also supports the circular economy by repurposing waste materials.

Naturgy has taken many steps to promote innovation in its company and all the different fields the company affects. In 2023, Naturgy implemented 353 biodiversity initiatives, restoring 336 hectares, 22% of which are protected areas. Moreover, Naturgy’s social initiatives, like the Equality Plan (2023-2027) and the Flex&Lead program, aim to foster diversity and development within the workforce, supporting a more inclusive and equitable environment. Naturgy is also taking steps to innovate its company core, as they have set goals to become more diverse, in sex, culture, and race. By 2024 the company has goals to have 40% of their working body be women. It is important to note that these said women are set to be doing great things and are in high-ranking, management positions.

Through these innovations in biomethane, renewable energy, smart grid technologies, and company management Naturgy is setting new standards in the energy industry. The company’s innovative approach addresses a variety of the UN Sustainable Development Goals. Their effort towards promoting inclusiveness and diversity in their company (SDG 5 & 10) coupled with the company's effort to not only implement but also research and innovate the fields of renewable/clean energy, sustainable infrastructure (smart grid technologies), secure energy supplies, and finally a circular economy (SDG 7, 9, 11, 12, & 13) demonstrates Naturgys assimilation with the UN’s goals. All in all, Naturgy’s vision for the future embodies the UN’s goals and has set a precedent for companies and companies to come.

Inspiration

Naturgy’s drive for innovation is fueled by a deep commitment to tackling global challenges like climate change and social inequality. “The company aims to align itself with the EU’s green deal, [towards a circular economy, and a more sustainable world]” said Alfredo Ingelmo (Naturgy Head of ESG). The leadership team is inspired by the need to provide sustainable energy solutions while promoting an inclusive and diverse workplace. Naturgy’s Executive Chairman, Francisco Reynés, emphasizes the importance of Naturgy’s role in “transforming the world through energy” and the commitment to a just and inclusive transition that leaves no one behind. This vision guides the company’s mission to balance environmental sustainability with economic growth and social responsibility.

Alfredo, as well as Alicia also highlighted Naturgy's will to, “Generate a good reliable image” as well as expressing the company's need to push towards a more diverse working body, they both highlighted the increase women have found in “all areas of the company”. All in all the company's desire to help preserve Mother Earth coupled with its aspiration for equal opportunity and diversity has led the company to make great strides toward innovating the energy field. Without the trust, work, and commitment of all the people who are part of this corporate project, Naturgy maintains a strong commitment to their development, evidenced by the 14% increase in the number of hours devoted to training in 2023 (2023 Executive Report).

Overall impact

Naturgy’s innovation has a positive impact on society, the world, and business. They are creating a better and more sustainable work environment for everyone. Nartugy has a long and short-term vision with their innovation with some goals being set decades ahead. Their biomethane projects will have positive impacts as they are set to supply thousands of homes with this renewable energy by late 2024 alone. This not only will drastically reduce carbon emissions yearly but will also contribute towards the world's commitment to reducing carbon emissions as a whole by finding alternative solutions for good, clean, and reliable energy production.

In terms of biomethane, Naturgy generally has a long-term vision for energy production using this renewable energy source, but in 2024 we will see the implementation of this energy source through the power grids in Spain. In terms of a long-term vision for their innovation, Naturgy is focusing on producing zero net emissions by the year 2050 along with maintaining/growing gender equality and diversity within their workspace by 2030.

The impacts of the Innovation can be Seen through Naturgy's progression yearly, the 2023 introduction of a solar ranch in Texas that is capable of large amounts of clean electricity is evident in how the Innovation has had a positive impact on the reduction of carbon emissions through energy production. In 2020 Naturgy had reduced their Greenhouse Gas emissions by 16% and in 2023 they had almost doubled and managed to reduce them by 30%, evident to the positive impact their innovation has both long term and short term.

Business benefit

Naturgys innovation of renewable energy projects, such as the 7v Solar Ranch in Texas and BerryBank II in Australia, have boosted Naturgy’s revenue streams. This is due to the attraction they garnered by proxy of environmentally conscious consumers and investors. Additionally, they were able to tap into new markets and expand on old ones. In 2023, over 60% of Naturgy’s €2.1 billion investments were directed toward growth in renewable energy, ensuring a steady transition to a low-carbon energy future while strengthening the company’s market position.

Additionally, the biomethane projects not only contribute to Naturgy’s sustainability goals but also open new avenues for revenue through the commercialization of renewable gasses. These projects enhance Naturgy’s ability to meet increasing regulatory demands (EU) for greener energy solutions while positioning the company as a leader and pioneer in biomethane production not only in Spain but globally. For example, the Vila-sana biomethane plant will provide enough energy to power 3,150 homes annually. Hence, creating a reliable as well as sustainable revenue stream. Naturgy's integration of smart grid technologies also improves energy efficiency, reduces system losses, and lowers operational costs. Overall helping Naturgy save money in the long run. These innovations help optimize the efficiency of Naturgy’s infrastructure and also enhance customer satisfaction by providing reliable and clean energy, solidifying the company's reputation as a trusted energy provider.

From a financial perspective, the company’s transition to cleaner energy has also made it more appealing to ESG-focused investors. Naturgy was recognized with a gold rating by Ecovadis, ranking among the top 5% of companies for sustainability. Additionally, they are featured in the FTSE4Good index. All in all, their reputation built on their dedication and innovation has enhanced Naturgys credibility in the eyes of global investors.

Ultimately, Naturgy’s innovation strategy allows the company to successfully navigate the difficulties of energy transition while at the same time achieving financial growth, operational efficiency, and a strong competitive edge in the global energy market.

Social and environmental benefit

Naturgy is committed to both economic and social development. The company provides knowledge and management capacity, as well as the allocation of its revenue to social investment. Their commitment is to offer communities a quality and continuous supply of energy. Additionally, they wish to aid in confronting challenges associated with access to energy, especially those affecting vulnerable groups. Furthermore, the company aims to minimize the effects that energy transition has in varying territories through just transition initiatives. Overall, Naturgy’s total social investment amounts to 11 million euros.

Naturgy’s social highlights include the rehabilitation of more than 4,400 homes and 2,502 families. Naturgy has aided in the development of several territories in Spain, such as the Canary Islands. They have developed the contents and materials of new modules and infrastructures “sustainability applied to the production system” which will help society move forward to become more efficient and sustainable. Furthermore, Naturgy has published the study “Women's employment in the just transition in Spain” which provides the first complete diagnosis of the situation of women in the energy transition labor market based on real data. The company launched the first professional training course on Photovoltaic installations aimed exclusively at unemployed women. Collective through Naturgy’s foundations as well as programs there were 184, 347 beneficiaries. Additionally, the company has contributed more than 21, 586 hours of corporate volunteering. Naturgy has stayed true to its values and still focuses on maintaining a social relationship with the communities that they are involved in, fostering growth and care through its varying innovations.

Lastly, their social relationship model is an iterative process that relies on the application of methodological tools with a cross-cutting focus on communication, active listening, and laying down a solid foundation. The model includes: Determining the area of influence and environment of the activity, stakeholder mapping and characterization, analysis of risks and opportunities, social relationship plans (SRP), and social impact assessment of the Social relationship plan. Overall, reassuring that Naturgy is making a difference.

Overall, Naturgy has shown that its innovation benefits both the societies and environments that they are involved in. The company makes sure to link sustainable development goals to their business ensuring success in an environmentally friendly way. Naturgys innovation not only helps societies but also the world as a whole. Fostering new technology and a precedent for change.

Interviews

Alfredo Ingelmo, Board member, Head of European Regulation, Head of ESG, advocacy and communications, Global Head of Environment, Health and Safety

Alfredo Ingelmo, Board member, Head of European Regulation