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The machines are marching. What is the next move of the Energy Sector and where are our lawyers? Our latest iLex LegalTech Article is written by Zsolt Bertalan Chief Executive Officer of MVM Group Smart Future Lab Zrt. about the brand-new challenges of the Energy Sector and its lawyers are facing. Lately we can read about the UK's EU referendum all over the places. It is indeed a historic event. For me it has a symbolic importance, that on the day when the results of the voting were announced the headline on the cover page of the Economist was this: March of the machines, a special report on Artificial Intelligence. Of course The Economist is full with Brexit related articles as well, nevertheless it is clear that the editors even these days believe it is important to talk about the social and economic consequences of the ongoing technology revolution. They are not alone with this view. IBM published a study in November 2015 which summarizes the results of 28 000 interviews made with C-level executives between 2003 and 2015 coming from diverse sectors and geographies. One of the key outcomes is that the executives ranked technology as the most important external factor they need to keep close watch on from strategic perspective. In Energy and Utilities traditionally regulatory environment is the single most important external factor, however even in this industry now technology is considered more and more important and become focus area for the managements. No surprises. Energy and Utility and especially power generation and distribution is experiencing radical shifts. There is more and more focus on energy efficiency, customers are becoming better informed, distributed energy generation mostly based on renewables is rapidly gaining share. Traditionally giant corporations generated power in giant power plants and distributed it in one direction to the consumers similarly to the way traditional television broadcasting works. Contrary the modern smart grid works like social media: industrial and retail consumers are not only consuming power, but also generating for instance using solar panels. They are becoming power consumers and power generators in the same time. The number of the players and the complexity of their interactions is elevating to a new level. Well informed consumers are also becoming more and more demanding. The drivers of the changes in Energy and Utilities are the so called cleantech companies. They are typically startups combining deep industrial knowledge and business model innovation with cutting edge infocommunications technology. These emerging players are targeting areas like renewables and e-mobility. Annual cleantech investment in North America, Europe, Israel, China, & India was around $500 Million in 2001 while in 2008 exceeded $8 Billion. Today market capitalization of Tesla only exceeds $31 billion. While the valuation of the leading cleantech startups is skyrocketing traditional energy corporations are struggling. As an example the market value of the two German utility giants E-on and RWE has dropped to a fragment of what it was some years ago. Reasons are complex but emerging technology challenge is definitely one of them. Corporations are forced to react to the changes. Leading players are opening up they own technology incubators and also investing in cleantech startups. Client focus, sustainability and innovation are key elements of the recently announced new strategy of MVM Group. I am thrilled about playing a role in this exciting transformation as General Manager of the newly established subsidiary of MVM called Smart Future Lab. We are offering valuable partnership for cleantech startups. The ones who chose us to work with can not only count on equity investment, but also can access the industry expert network of MVM and can validate they concepts collaborating with real life clients of the MVM Group and finally our dominant market position in our home country can also make us attractive partner for the ambitious innovators. In the keynote of this discussion series of Ferenc Pongrácz he referred to the famous statement of Marc Andreessen: Software is eating the world. He agreed that IT driven technology and business model innovation is indeed reshaping complete industries. According to Pongrácz even the most conservative disciplines like Law are no exceptions. As an Energy and Utility professional and experienced corporate executive I can just confirm that we cannot be successful without innovation at MVM either. In our new world all corporate functions need to adopt including our legal departments and external Legal Councils. When a large corporation like MVM group with thousands of employees is partnering up with startups who are making decisions is an extremely rapid way in an environment where speed to market and instant reactions to the changing environment is question of life or death, then we also need to be faster, more flexible and more customer oriented. We also need to balance the traditionally risk averse mentality of the legal profession and the by definition risk-taking mentality and high level uncertainty of the startup world. Meanwhile we must be transparent toward our investors and owners and maintain a rule based professional business environment where all decisions are properly documented. It is not an easy call. Therefore, I believe we also need to use the achievements of the LegalTech revolution since in order to be successful key corporate functions like the Legal one needs to only follow the technology and business trends, but shape them. Zsolt Bertalan Chief Executive Officer MVM Group Smart Future Lab (SFL) Zrt.