6 May 2026
Managing energy has always been part of running an industrial operation. But for most companies, it has been managed as a cost to contain rather than a risk to manage. That approach is becoming increasingly difficult to sustain. The energy and carbon landscape is moving faster than most organizations can track internally and the cost of being reactive is growing. Most companies prefer to focus on their core business rather than worry about these added costs.
Today the question is: is your energy strategy driving your decisions or are market shocks and regulatory deadlines driving them for you?
The risk landscape has fundamentally changed
Energy prices: the structural risk behind the volatility
European energy prices have been volatile for years, but the underlying driver is often misdiagnosed. The sharp price increases that followed the outbreak of the war in Ukraine, the continued instability in gas markets linked to Middle East geopolitics and the cost of emergency LNG imports at peak demand: these events are not random shocks. They are the predictable consequence of an energy system that remains heavily dependent on fossil fuel imports whose price is set by factors outside European control. Europe imports over one billion euros of fossil fuels every day. Each geopolitical disruption exposes that dependency. The decarbonization of industrial processes through electrification, fuel switching and renewable procurement, is therefore not only a climate response. It is an energy security and cost resilience strategy.
At the same time, the increasing share of solar and wind in the European electricity mix is introducing a different and more structural layer of price complexity. In Belgium, the number of hours with negative spot electricity prices doubled between 2023 and 2024. The captured value of solar production has declined year after year. Grid capacity constraints are tightening in parallel. For any energy-intensive company or one considering a long-term renewable energy contract, this volatility is now a permanent feature of the pricing environment.
ETS: a rising cost line and an expanding perimeter
The EU Emissions Trading System has driven a 50% reduction in covered industrial emissions since its introduction, while the European economy continued to grow. Free allocation is shrinking toward 2030 and allowance prices are structurally linked to the cost of remaining abatement options which rises over time. ETS II, entering into force progressively from 2027, extends carbon pricing to buildings and road transport. It creates indirect cost consequences across supply chains. The structural link between ETS cost and fossil fuel dependence is direct: energy strategy and ETS strategy are therefore not two separate workstreams. They constitute the same optimization problem.
A regulatory environment that moves faster than procurement cycles
RED II and RED III, CSRD, CBAM, the EU Electricity Market Design Reform, Belgian regional frameworks such as Conventions Carbone (CC) in Wallonia and Energiebeleidsovereenkomsten (EBO) in Flanders, form a dense and rapidly evolving regulatory overlay. CSRD introduces detailed energy disclosure obligations. CBAM reshapes the economics of embedded carbon in traded goods. Each framework creates obligations and opportunities with defined timelines. The difference between acting early and reacting at the compliance deadline is the difference between managing risk on your own terms and absorbing its consequences on someone else’s.
So how does an organization stop reacting and start acting?
Measuring and linking energy consumption to carbon and ETS obligations
The foundation of any energy and carbon risk strategy is an accurate, granular picture of consumption (across sites, processes and energy vectors) mapped to ETS obligations and carbon accounting. An analytical and regulatory layer translates data into strategic insight: where ETS cost is concentrated, how the fuel mix affects the allowance position, what the emission trajectory looks like under different reduction scenarios (e.g. fuel switch, electrification, efficiency measures,…).
Flexibility: the growing value of when you consume
With increasing renewable penetration and tightening grid capacity, the timing of electricity consumption carries growing financial and carbon significance. Shifting energy-intensive processes away from peak price hours or aligning consumption with periods of high renewable production, reduces both energy cost and carbon intensity. Demand response, load shifting and curtailment provisions within PPA contracts are increasingly standard tools for energy buyers. How do you align your load profile with shifting market dynamics and grid constraints? Through close partnerships with specialized flexibility operators and energy management software, CLIMACT does the heavy analytical lifting for you.
Green energy procurement: understanding the instruments and their limits
Green energy procurement involves a range of instruments (Guarantees of Origin (GOs), physical and virtual PPAs, onsite renewable production), each with different risk profiles, carbon accounting implications and degrees of additionality. Not all GOs are equivalent. Certificates from ageing installations in distant markets reduce scope 2 emissions on paper but contribute little to the development of new renewable capacity.
PPAs are typically 10 to 25 year contracts whose main risks (price, volume, profile, balancing and counterparty risk) interact differently depending on structure and geography. Cross-border PPAs introduce additional basis risks linked to price correlation between market zones. Onsite production and offsite procurement are complementary strategies whose optimal combination depends on load profile, grid constraints, investment availability and the company’s carbon accounting framework (which is also changing with GHG Protocol updates).
Quantifying the business case for energy development projects
Any renewable energy investment requires a rigorous business case analysis: long-term price scenario modelling, capture rate projections, sensitivity analysis and a clear view of the applicable regulatory support framework. In Wallonia, the kECO tool developed by CLIMACT enables organizations to calculate the green certificates claimable for a given energy development project under the regional support framework, providing a reliable quantitative basis for the financial case.
Finally, integrating ETS optimization with energy strategy
Beyond annual allowance surrender, the relevant questions are: what is the verified emission trajectory? How does the fuel mix and procurement strategy affect the net allowance position? Where are the most cost-effective abatement options and how do they interact with investment decisions already under consideration? Managing these questions in isolation from procurement and operational planning leads to suboptimal decisions, particularly for operators with complex multi-site, multi-vector energy profiles.
The case for a structured, external perspective
Industrial energy and carbon management have become a specialized discipline. The data required (consumption profiles, market forward curves, regulatory frameworks, GO certificate quality, PPA risk structures, ETS allocation methodologies) is dispersed, changes frequently and requires sustained expertise to interpret correctly.
Most industrial operators have strong internal knowledge of their own processes and constraints. CLIMACT brings support with dedicated tracking capacity of evolving market structures, regulatory frameworks and procurement best practice to add the most value not as a replacement for internal expertise, but as a complement to it. The companies that manage this well do not do so reactively. They build an integrated view of their exposure, update it as the environment changes and make decisions ahead of the regulatory or market events that force everyone else to act.
