Download Innovations - Finance

UK Energy Programmes
Ian Behling
2nd April 2007
Making business sense of climate change
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
The Carbon Trust
 Independent company set up in 2001 under the
UK Government’s Climate Change programme.
“accelerate the transition to a low carbon
economy by helping organisations reduce
their carbon emissions and develop
commercial low carbon technologies”
Five low carbon business areas
Innovations
Solutions
(Public £ with private
co-funding & support
(Public £ with
some co-funding)
Advisory services
Research support
- Carbon Management for corporates, Local
Authorities and Higher Education
- On site energy efficiency advice
- Buildings Design Advice
- Advice lines, publications and
training events
- Raising awareness of climate
change as a business issue
- Carbon Vision (EPSRC JV)
- Applied research (mainly SMEs)
- Research accelerators
Financial products
Business incubation
- SME interest-free loans
- Local Authority financing (Salix)
- 4 dedicated low carbon incubators
Imperial Innovations; ISIS Innovations,
TTP and Angle Technology
Enterprises
(Private £ with public
sector seed funding)
Technology demonstration
-
Marine Energy Challenge and EMEC
Micro-CHP & smart metering trials
Low Carbon Buildings
Biomass for heat
Investments
(Private £ with public
sector seed funding)
Development of new businesses
Early stage investing
- Connective Energy (heat partnerships)
- Partnerships for Renewables
- Insource Energy - waste to energy
- In-house investment portfolio
- Venture capital fund creation
- 3rd party investment funds
Insights
Public £
For Investors, policy
makers, researchers and
businesses…
Low Carbon Technology
Assessment, (Dec 2002;
updated February 2007)
EU ETS: Implications for
Industrial Competitiveness,
April ‘04
Brand Value at Risk from
Climate Change,
March ’05
Biomass Sector Review,
October ’05
Policy Frameworks for
Renewables, July ’06
Carbon Trust business areas tackle technical and
market barriers to reducing CO2 emissions
Develop technologies
Development
Deployment
pre-commercial
market
commercial
Innovation
R&D
Enterprises
Barriers
technological
Research
Deploy technologies
Solutions
Innovation
incubator support
Early stage
investments
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
Solutions works with business and the public sector
to deliver energy, cost & CO2 savings cost-effectively
Large
Description 

Customer 
energy bill
Products
Offered







Medium
Small
Deep relationship
with flexible service
offering
50/50 funding

Direct on-site
interventions
using standard
products

Remote provision
of lower cost
services to mass
market
> £ 3m

£ 50k – 3m

< £ 50k
Carbon
Management
Detailed Surveys
Technical Feasibility
Studies
Strategy & Policy
Development
Monitoring &
Targeting
Awareness and
Training
Innovative pilots




Site Surveys
Technical Advice
Helpline
Website




Helpline
Website
Publications
Loans
Solutions works with business and the public sector
to deliver energy, cost & CO2 savings cost-effectively
Carbon Trust Solutions
Energy bill
range
Market size
(# of Orgs)
£1m+
~2,800
Cost effective
services
Activity
(05/06)
Carbon
Management
175 Orgs
£50k - £1m
~28,000
Site Surveys
3,700 Orgs
(5,400 visits)
£10k - £50k
~106,000
Loans
266 loans
~1.79m
Helpline,
website
20,000 calls
350,000 web
visitors
£0 - £10k
Source: CT impact assessment 2005/06, ONS, CT analysis
Identified 3.9
MtCO2 that could
save £390 million
on annual energy
bills. 1.6MtCO2
saved so far.
The five step Carbon Management process
Step 1:
• Secure commitment from organisation at highest level
Mobilise the
organisation
• Define roles and responsibilities
Step 2:
• Identify risks and opportunities
Evaluate the
business case
Step 3:
Identify
opportunities
Step 4:
Develop
implementation
plans
Step 5:
Manage
implementation
• Calculate value at stake
• Develop detail picture of company wide emissions
• Identify cost-effective emission reductions opportunities
• Prioritise opportunities according to cost-effectiveness and
own corporate criteria
• Develop an emissions reduction plan with budgets targets
and assigned roles and responsibilities
• Monitor progress and effectiveness of plan
• Re-assess priorities and include new ideas/actions
Selection of Carbon Management clients
Not just big companies can save energy, money and
CO2
Energy Efficiency Loan Scheme: aims and benefits
Aims:
 To encourage businesses to upgrade or replace equipment
with energy efficient versions
 To support implementation of energy saving projects
 To save money and deliver carbon savings on site
Benefits
 Interest-free
 Unsecured
 No arrangement fees
 Borrow up to four years
 Repayments match savings
 Multiple loans
Energy Efficiency Loan Scheme: statistics
 Over 840 organisations have received loan offers
worth £28M;
 Small and medium size businesses invested over
£40m in energy-saving projects;
 Over 80ktonnes pa CO2 emissions abated;
 Over £10m pa saved in fuel cost.
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
Innovations: Carbon Trust Applied Research
2007
Commitment by technology category:
Carbon Trust contribution £16.6M
Total portfolio value £39.1M
Innovations: Technology Accelerator Projects
 To develop and/or progress new low carbon
technologies; and overcome barriers to market
entry of existing low carbon technologies.
– Marine Energy Challenge – published Jan 2006;
– Micro-chp trials – interim results published Nov 2005;
– Smart metering for the sub-100kW market – mid-term
update published Nov 2005;
– Low carbon non-domestic building refurbishment;
– Biomass for heat off the gas grid.
Innovations: Carbon Trust Incubator Network
Opportunities
University spin-outs
CT Incubators
‘Investment
Readiness’
Angle
CT/Shell
Seed Fund
SMEs
Start-ups
Imperial
Entrepreneurs
Innovations
Corporate spin-outs
ISIS
Innovations
Through networks,
R&D open call &
active marketing
TTP
Plus specialist
suppliers & experts
Investors
Workshops
Carbon Trust
Investments
Limited
Investor
conferences
VCs
Hedge Funds
Business
Angels
Incubator support – up to £60K over 1-2 years
Technology
Commercial potential
Intellectual Property protection
Identifying & engaging customers
and partners
Product development and
engineering
Market sizing and risk
Route to market
Management team
Funding
Competencies and gaps
Sources of funds
Finding experienced directors
and non-execs
Profitable business model
Mentoring
Investment focus
The Incubator Programme has helped many
companies attract private funding
Since the start of the programme in April 2004:
 40 companies supported
 20 have raised £14M private investment (excluding
AIM listings)
– Carbon Trust has invested in 3 of the 20
– 3 have listed on AIM (CMR, Oxford Catalyst and
ITM Power)
 3 licence agreements put in place
 15 of those incubated have also received Carbon
Trust R&D funding
 2 have taken part in Technology Accelerators
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
Investments: £7m venture capital investment
has leveraged over £68m over last 4 years
Total Funding £750,000
Total Funding undisclosed
Total Funding £800,000
£250,000
£1,000,000
£400,000
Working capital
Sales growth
Biomass CHP
Working capital
Technology development
SOFC Fuel Cell
Working capital
Sales growth
Innovative Building Materials
Lead Investor
Co-lead Investor
Co-lead Investor
Total Funding £719,000
Total Funding undisclosed
Total Funding £7,000,000
£300,000
£650,000
Working Capital
Technology development
Concentrated PV Solar
Start-up
Technology development
Mixed Reactant Fuel Cell
£1,500,000
Lead Investor
Co-lead Investor
Working Capital
Technology development
Offshore Wave Generator
Syndicate Investor
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
Carbon Trust Enterprises portfolio of new business
ventures to meet needs for low carbon solutions
 pro-actively
developing new
ventures;
 targeting emerging
customer demands
for low carbon
solutions that are
not being met by
the private sector.
 partnering to
create value;
 bringing together
the right mix of
people, finance,
assets and
technologies
drawn from all
sectors.
Carbon Trust Enterprises: commercialisation stage-gate
process selects the most promising options
Decision
Gates
New
ideas
Projects
Idea
Screening
Opportunity
Evaluation
Opportunity
Bank
Advisory
Group
CTEL Board
Commercial
Proposition
“Scope”
Business
Case
“Develop”
Stranded
Credits
Implementation
services
External
Investment
Proof of
Concept
“Build”
“Waste4Energy”
“Partnerships for
Renewables”
Establish
Business
“Launch”
“CT Pipelines”
Enterprises: catalysing the development of the low
carbon economy through creation of new low carbon
ventures
Connective Energy: Business launched


Waste heat pipelines business targeting a core market worth up to £1bn a year in the
UK and an annual carbon saving potential of 2MtC
Joint venture with Mitsui Babcock Energy Limited and Triodos Renewables. Anticipated
direct leverage of 20:1
Partnerships for Renewables: Under development



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Develop and manage onsite renewable energy projects for public
sector bodies
Targeting 500MW of installed capacity with potential to catalyse
market worth up to 3GW
PfR can save 0.2MtC per annum directly and catalyse up to 1MtC
£10m seed funding from Defra: aim is to catalyse up to £500m
of private sector investment
Further opportunities
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Insource Energy under development: utilisation of food waste for energy; in addition
contributes to wider resource efficiency and nitrates directive objectives
Potential to leverage large scale direct funding and catalyse major investment in low
carbon industries
Established network of investors, partner companies and contacts
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
Insights and strategic activities
 Developing new customer services – eg, carbon
management; carbon labelling;
 Developing understanding of the ways in which low carbon
policy interventions impact on markets – eg renewables
study; studies on the EU Emissions Trading Scheme;
 Extending knowledge about low carbon technologies and
their value chains;
 Working to inform Government about policy options,
effectiveness and impacts – eg low carbon buildings
strategy;
 Working with leading corporates (eg, BT, Tesco, etc) to
share insights on the pathways to a low carbon
economy.
The Carbon Trust’s strategic activities
Overview
 What is the Carbon Trust?
 Carbon Trust’s business areas:
– Solutions
– Innovations
– Investments
– Enterprises
– Insights
 AEA Energy & Environment
AEA Energy & Environment
 Delivery Partner to the Carbon Trust
–
–
–
–
–
–
Programme management
Technical support and advice
Grant management
Due diligence
Product development
Analysis and measurement
Define, Develop, Deliver & Document Succes
www.carbontrust.co.uk
Or
[email protected]
Making business sense of climate change