September 2016
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EDITORS COMMENT
Innovations large and small... THE PHRASE “OFF THE GRID” was once associated
with a complete abandonment of technology. Now, with the increasing availability of energy storage systems, consumers can go “off the grid” in their very own homes. In this month’s edition of Energy Digital, we take a look at six big names making waves in the home energy storage market. Speaking of waves, we’ve also plunged into the world of wave and tidal energy with a feature on the European Marine Energy Centre (EMEC), a state-of-the-art testing facility for wave and tidal technologies. It’s predicted that wave and tidal energy could one day generate up to 20 percent of electricity in the UK. EMEC’s Managing Director talked us through what is needed for a wave and tidal take-off. Lastly, we examine how 3D-printed heat exchangers could create a revolution in the energyefficiency of buildings. The potential for energy savings isn’t always obvious; sometimes it is hidden, largely unseen, in an HVAC system. As always, let us know what you think of the issue @EnergyDigital
Enjoy the issue! Jennifer Johnson Editor jennifer.johnson@bizclikmedia.com 3
CONTENTS
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F E AT U R E S
PROFILE
How wave and tidal energy is coming into its own LIST
TECHNOLOGY
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3D printing a sustainable future 4
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Six big names in the home energy storage market
C O M PA N Y PROFILES
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Mistras Group Ltd Europe
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Halliburton USA & Canada
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First Utility Europe
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S2nrg
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Unitywater
USA & Canada
Australia
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PROFILE
Riding the w how wave and tidal energy is coming into W r i t t e n b y Jennifer Johnson
wave its own
Energy developers have been capitalising on the earth’s renewable resources for decades. While wind and solar technologies are already well-established, wave and tidal energy is, relatively speaking, still in the early stages of development. The European Marine Energy Centre offers would-be tidal tycoons a place to test their turbines, and some prototypes are nearly ready to be released into the market.
PROFILE HUMANS HAVE HARVESTED energy from bodies of water long before the invention of the light bulb. The ancient Romans notably used water mills in early industrial processes, like large-scale grain grinding and ore crushing. Increasingly, modern civilisations are realising just how much power marine energy can yield — and how these sources could be a vital addition to existing generation capacity. “The Carbon Trust did some
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work a few years ago which offered estimates on how much energy is harvestable, and they estimated that the UK could probably provide around a fifth of its electricity from wave and tidal energy,” says Neil Kermode, the Managing Director of the European Marine Energy Centre (EMEC), based in Orkney. “And that’s about the same as nuclear is doing currently.” EMEC, which offers marine energy developers the opportunity to test their technologies in an open-sea environment, is the only centre of its kind in operation today. Its clients are primarily involved in the production of converters for wave and tidal stream energy. The former is, in effect, ‘old’ wind energy: as wind blows onto the surface of the ocean it produces waves, and energy is then extracted by harnessing the up and down motion of the water. Conversely, tidal energy is driven by the larger-scale movement of the planets. The gravitational pull of the sun and moon produces tides which ebb and flow across the earth’s surface. The rapid movement of water through gaps and corners in coastline can be channelled into electricity via a turbine which
N O T A L L AT S E A
turns the tide rushes past. Other methods — like tidal barrages and salinity gradients — exist for generating energy from large bodies of water. However, EMEC is focussed on the development of wave and tidal stream schemes. Now, the question on the lips of the technology’s investors and developers is: will the UK truly derive 20 percent of electricity from the oceans which surround it? “It really depends on how hard we try and whether we get the prices down from the present research and development stages,” says Kermode.
“The particular advantage that wave and tidal offers the UK is that it is an inexhaustible resource and if we can provide a fifth of our electricity from our own waters, it means that there is a recirculation of capital within the economy, and it gives us sovereignty over what happens.” The United Kingdom, and other countries with long stretches of westfacing coastlines, are well-placed to incorporate wave or tidal energy into their respective energy mixes. Stronger waves tend to blow in from the West — as in Ireland, Portugal, Spain and
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France — while Scotland, Canada and many parts of Asia possess shores with a suitably strong tide. “There are a number of locations with tides that are exploitable,” Kermode says. “There will be different technologies which grow for different market niches.” At present, many wave and tidal projects tested in EMEC’s waters are reaching the advanced stages 10
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of research and development. The MeyGen project, the largest fully consented tidal stream project in Europe, is currently installing full-scale industrial turbines in the inner sound of Scotland’s Pentland Firth following prototype testing at EMEC. According to Kermode, other projects are not far behind. “We are moving through the technology readiness levels,” he
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“The UK could probably provide around a fifth of its electricity from wave and tidal energy, and that’s about the same as nuclear is doing currently”
explains. “One starts with a basic ‘bathtub’ idea at technology level one, and progresses from there. We are probably at levels 5 and 6, where largescale prototypes have been put into the sea and have been found to work with varying degrees of success.” Companies of all sizes, from major utilities to small-and-medium enterprises, are taking their prototypes to Orkney to test their fitness for the 11
PROFILE
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N O T A L L AT S E A
market. Renewable energy firms aren’t the only ones hoping to get turbines in the water. Diversified organisations interested in producing clean energy for large-scale industrial processes — including Rolls Royce, French rail giants Alstom and locally-based Scotrenewables — have all trialled marine energy prototypes at EMEC’s facilities. “It’s quite a market and we’re in something of a race at the moment to find the country that will first crack the technology and be in a position to sell it into the global market,” Kermode says. The turbine which eventually makes its way to large-scale production must be efficient, reliable and flexible, capable of operating in a variety of marine environments with minimal maintenance needs. The developer who finally does ‘crack’ the market must also set its sights far beyond domestic application of marine energy. “There are communities around the world that are running on diesel generators: a lot of island communities in the South Pacific and isolated areas down the coast of Chile,” Kermode says. “Those places have electricity costs four of five times higher than the
UK’s, so those markets may become economic before the UK does.” In the coming years, Kermode predicts that the prototypes going into the sea at EMEC will be more advanced and adaptable. Across the globe, there are likely to be more small-scale projects being installed and used to generate electricity in earnest. As for the UK, Kermode can’t say exactly when marine energy will supply 20 percent of the country’s electricity: “It depends on how desperately we need the power and how seriously we choose to decarbonise,” he says. “Because capital follows successful projects, it about helping to foster these technologies at the smaller scales so that they can actually prove themselves. That means the market will then choose which way it wants to deliver energy and we want to make sure it picks marine as one of those ways of doing it,” he explains. “Wave and tidal energy has lowcarbon impact, low environmental impact and a high recirculation of capital into the local economy. We’re sure it is going to get picked, it just has to prove its worth.” 13
3D printing a sustainable future Heat exchangers are one of the most vital, but little-lauded, components of a modern building. Scientists at the University of Maryland have imagined an optimised, energyefficient design for the part — and used 3D printers to make them a reality. Writ te n by: TA M S I N OX FO R D
TECHNOLOGY
The University of Maryland used direct metal printing—a 3D printing technology—to manufacture a unique miniaturized air-to-refrigerant heat exchanger as a single, continuous piece. Image: University of Maryland, Center for Environmental Energy Engineering. 15
TECHNOLOGY THE UNIVERSITY OF Maryland and the Department of Energy’s Building Technologies Office recently used 3D printing technology to prototype a heat exchanger unit which weighs 20 percent less than the standard and is 20 percent more efficient. In a time when terms such as ‘sustainable’, ‘energy-efficient’ and ‘consumption’ are weighing down most conversations, this tiny invention could be something that brings about big innovation. “This project was selected as part of the Energy Savings through Improved Mechanical Systems and Building Envelope Technologies 2012 Funding Opportunity Announcement (FOA),” explains Antonio Bouza, Technology Manager for the Department of Energy (DOE) HVAC, Water Heating and Appliances R&D portfolio. “The University of Maryland was chosen
through a competitive process which used external reviewers.” The DOE invested in this specific line of research as part of its goal to develop next-generation heat exchangers which are designed to improve the energy efficiency of electric vapour-compression heat pumps and air conditioners over a broad range of operating conditions. The department is always on the lookout for heat exchangers which are suitable for condensers or evaporators in air conditioners or heating-only pumps, as well as those which are suitable for both condensing and evaporating for reversible heat pumps. Part of the brief for the funding read: “heat exchangers for air-to-air, waterto-water, air-to-water, and water-to-air heat pumps and air conditioners are of interest, but ground coupled heat exchangers will not be
“Heat exchangers are so prevalent and vital to the modern world that by improving their performance, you can improve the performance of literally millions of products” 16
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3 D P R I N T I N G A S U S TA I N A B L E F U T U R E
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PROJECT OVERVIEW Technology History Builds on previous University of Maryland researchexploring innovative heat exchanger designs Partners • University of Maryland, College Park • Oak Ridge National Laboratory • 3D Systems • Burr Oak Tool • Luvata • International Copper Association • Wieland • Heat Transfer Technologies Applications Residential and commercial air conditioners and heat pump systems Benefits • 20% increase in heat exchanger efficiency • Reduced weight and size of heat exchanger • 3D printing enables unique, intricate designs not possible with other manufacturing methods Doe Funding • $1.5 million
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considered since they have been the subject of other recent FOAs.” “Heat exchangers are so prevalent and vital to the modern world that by improving their performance, you can improve the performance of literally millions of products,” says Bouza. “By using an innovative, 3D-printing process, the University of Maryland and its partners are accelerating the development of energy-efficient heat exchangers that offer industry an adaptable solution for heating and cooling needs.” The University used direct metal printing, a form of 3D printing technology, to manufacture a miniaturised air-to-refrigerant heat exchanger in one continuous piece. They worked with 3D Systems and the DOE to prototype this tiny component which they define as one of the most important enabling technologies in a building today. Heat exchangers are used almost every time a space needs heating or cooling and they do exactly what the name says – they exchange heat from one area to another. That simple. And that complex. It is globally a billion-dollar industry which affects everything from the consumer level to the retail sector, from industry to
aerospace engineering. Improving its performance has the potential to change energy consumption and control across millions of products with a positive global impact across energy consumption, sustainable building and costs. Until now, heat exchangers have been developed along fairly standard lines and those few that have adopted new, high-end features have battled with commercialisation. They have been too complex to manufacture to requisite scale and so have only really existed in the tailor-made to order segment. What the University of Maryland has done is introduce a new way of creating these devices which allows for greater control over design and deliverable, but without the high price tag or manufacturing complexity. 3D printing a complicated design is as costly as printing a simple one and the solution devised by the institution is not only improved in terms of energy and weight efficiencies, it can also be printed significantly faster. “The design was an optimised design model thanks to the ouput of software tools,” explains Bouza. “Then 3D printing enabled this complex idea to be made into a 19
TECHNOLOGY physical reality and this validated the output of the design tools. The software tool went through several hundreds, if not thousands, of iterations before the final design and it took more than just a single run to get right. 3D printing enables you to pursue designs not easily made by common tooling. Small feature sizes and varying thicknesses in design make it ideal for complex, optimised designs.� The University of Maryland outlined a number of distinctive advantages to their 3D printed heat exchanger,
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not least of which being the ability to transform design without the price tag. The device also improves performance and limits waste. It can be printed in one continuous piece and subsequently the prototypes are resistant to pressure or leakage. This, of course, then impacts performance and reliability and the amount of waste generated in production. The new 1kW miniaturised airto-refrigerant heat exchanger prototype was the first developed by the university and its success has given them the ability to explore
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new design ideas and solutions as part of their goal to cut energy consumption in this sector. A recent report by the DOE found that the service demands of buildings around lighting, warmth, cooling, water heating, electronic entertainment, computing, refrigeration and cooking uses around 40 quadrillion Btu a year. The University is hoping that a 10kW unit, along with the 1kW unit, will play a part in helping to reduce this figure to one which is slightly more palatable. “The 1kW device has a 20 percent increase in heat exchanger efficiency, is reduced in weight and size. This effectiveness leads to lower overall temperature differences, which then results in lower compression ratios and lower compressor power,” explains Bouza. “The benefits include reduced parasitic energy consumption, the ability to use low-gwp refrigerants and less refrigerant usage in a system overall. The impact of this compact heat exchanger is remarkable and the device can be used anywhere in HVAC, water heating and appliance applications.” It is hoped that the 3D printed heat exchanger will be commercially
“The impact of this compact heat exchanger is remarkable and the device can be used anywhere in HVAC, water heating and appliance applications” available and ready for application within both residential and commercial heat pumps and air conditioners by 2021. There remains some work to be done on the final product with testing around noise, production and application underway at the moment. It is an impressive achievement by both university and government department, and a clever blend of 3D printing technology and human ingenuity, using materials and solutions already in existence to overcome legacy challenges in design and cost to create something of inordinate value to the environment.
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LIST
Six b the h stor
Some days, th gale force gusts Intermittency in with if technolo reliable strea
Writ
big names in home energy orage market
he sun simply doesn’t shine. Other days, s are downing trees and turning turbines. n renewable energy must be contended ogies like wind and solar are to provide a am of clean power to grids worldwide.
tten by: JENNIFER JOHNSON
LIST UTILITIES NEED TO develop large-scale plans for storing renewable energy, but the increasing number of homeowners utilising rooftop solar must also be equipped to store energy for a, quite literally, rainy day. Big name engineering and electronics firms have noted the need for home energy storage, and launched into a race to create the most flexible and efficient systems. Here are six household names who have moved into the residential energy storage market, and the stats on each of their solutions.
SAMSUNG ESS Last year, Samsung’s renewable arm, Samsung SDI, took a step into the home energy storage market with its residential ESS solution. Customers with an existing rooftop solar PV system can choose from one of the company’s four ‘all-in-one’ storage units, equipped with capacities of 3.6kWh, 5.5kWH, 8.0kWh and a scalable option of up to 10.8kWh, respectively. The lithium-ion batteries have also been used in a grid-scale energy storage operation in Schwerin, Germany. The batteries include a DC system which reduces energy loss by using only one conversion process between solar panels and the home’s appliances. 24
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BOSCH German engineering and electronics firm Bosch has made it possible for solar-equipped homes to run on 100 percent renewable power during the summer months. The firm’s Bosch Power Tec BPT-S5 Hybrid storage solution features a transformerless 5kW inverter, a lithium-ion battery with a capacity ranging from 4.4kWh to 13.2kWh and a touchscreen energy management display. During the day, the system provides energy from rooftop solar panels, while storing any excess for use once the sun goes down. When the battery is full, excess energy is fed back to the grid. According to Bosch, using an inverter and storage unit can help homeowners generate up to 80 percent of their energy independently.
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LIST
BMW Earlier this summer, BMW announced it would be entering the increasingly interconnected EV and energy storage market. The automaker has partnered with another German company, Beck automation, to use the battery packs for its i3 electric vehicles as home energy storage units. BMW claims that its solution is the first residential energy storage system to use a complete EV battery, where competitors use parts or pieces of vehicle batteries to achieve similar ends. The system is available in 22kWh or 33kWh incarnations. The i3 batteries supplied may be either new or ‘second life’ units which have outlived their usefulness in the vehicles themselves. Theoretically, this will also extend the value of the unit for car owners. BMW says its system could independently power a home for up to 24 hours.
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PANASONIC Panasonic’s LJ-SK84A lithium-ion battery storage system debuted in 2015. It boasts a storage capacity of 8kWh, an output of 2kW and the ability to replace 70 percent of a home’s electricity needs. At the 2015 IFA electronics show in Berlin, Panasonic Europe CEO Laurent Abadie said: “We are not far from achieving 100 percent in the future. The time it will take to reach that goal depends on the region. If you are in the Nordics, you need a lot of energy in the winter, when you don’t get much light.” Panasonic is also Tesla’s strategic partner at its newly-operational lithium-ion ‘gigafactory’. The Japanese firm will manufacture battery cells, while Tesla will construct the battery modules and packs.
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NISSAN On paper, Nissan’s residential energy storage offering, which will be available to pre-order in Europe this September, doesn’t differ greatly from BMW’s proposition. The xStorage unit, a venture between the automaker and power management company Eaton Electrical, uses recycled electric vehicle batteries to connect to the grid or a home PV system. The retired Nissan LEAF batteries then charge up when power is cheaper or sufficient energy is generated from solar panels. Consumers can then sell their stored energy back to the grid when demand and costs are high. Nissan has also pioneered a vehicle-to-grid storage scheme for LEAF owners in the UK in partnership with Italian utility Enel and National Grid. Under the pilot, 100 drivers will use bi-directional charging stations to sell stored power from their car back to the grid at peak times.
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TESLA POWERWALL Like everything Tesla does, the lithium-ion Powerwall battery has made quite the splash in the media since Elon Musk debuted the unit in 2015. In the first quarter of this year, the company reportedly sold 2,500 units, with Tesla CTO JB Straubel saying that sales of the energy storage solution were starting to “ramp up”. “They are going in all around the world. It’s happening,” he said in an interview at the gigafactory earlier this year. The battery is available in two varieties: a $3,000 6.4kWh model and a $3,500 10kWh model. The larger capacity Powerwall was meant to serve as a backup generator during power outages, though it was quickly discovered that there was little need, or market, for the 10kWh model and it was discreetly discontinued. The company says that its 6.4kWh offering is sufficient to power most homes during the evening using stored energy generated by solar panels in the daytime. Consumers with greater energy needs may install multiple batteries to accommodate their usage. The battery comes with a 10-year warranty, or roughly 500 cycles, and the wholesale price to installers is USD $3,000. 29
Surveying assets
Written by Nye Longman Produced by James Pepper
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MISTRAS GROUP
MISTRAS Group brings decades of asset protection experience combined with the latest technological solutions, backed up by highly skilled technical staff
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ISTRAS Group has grown to become the go-to company for asset protection solutions, having developed industry-leading technology, solutions and skills that have been deployed across a number of key projects around the world. Supply Chain Digital speaks to Phil Cole, International Vice President about how the company can provide the assurance to clients from a range of sectors that their assets are safe, productive and compliant.
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Operations MISTRAS Group’s main offerings are heavily technology-focused, and enable a degree of asset protection that is not only world-leading and proactive, but is also adaptable to meet a diverse range of client needs including those coming from industrial sectors, energy companies, and those in charge of infrastructure assets. Using acoustic emission, vibration analysis, advanced ultrasonics, and a portfolio of unique conventional and advanced NDT products and
ENERGY
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M I S T R A S G R O U P LT D
Services • NDT Consultancy • Procedure Development Forth Inspection Service Ltd Enterprise Business Centre Admiral Court Poynernook Road Aberdeen AB11 5QX
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& Approval • Advanced NDT Validations • Specialized Witness • Technical Auditing
Tel: +44 1224 289751 Mobile: +44 7827 406627 Email: darren@forthinspectionservice.com www.forthinspectionservice.com
EUROPE
services, the company monitors mechanical integrity and can deliver both destructive and nondestructive testing. It can achieve all this while supplying customers with customised wireless data analytics.
“Our ability to do turbine blade inspections comes from our expertise in the aerospace sector in composites” Phil Cole says: “We routinely inspect oil and gas assets and civil structures such as bridges. Many of today’s offshore platforms that are operated in the UKCS are at their stage in life where life extension programmes are required. The skills and expertise of Mistras to perform RBI and NII is key to the success of these programmes to ensure operational and structural integrity safety.
“We are market leaders in technological advances in NDT with specialist systems for the inspection of areas of known concern in today’s environment such as CUI, trunnions, pipe supports, vessel saddles, and valves. Utilising technologies normally regarded as difficult to access or to interpret results from with our highly skilled personnel places Mistras in the position of being able to offer solutions which many others can’t.” All told, MISTRAS Group is present in 100 locations across the globe giving it coverage of the UK, Europe, Asia, and the Americas. Its ability to adapt to the nuanced requirements of the industries in providing its services is impressive, whether this be oil and gas, nuclear, petrochemical maritime, paper manufacturing, automotive, or buildings. Renewables Manager Nicola Mcglynn says: “MISTRAS Renewables Services offer a full and complete suite of inspection, repair and monitoring services.
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MISTRAS GROUP
These range from structural monitoring of composite blades where our expertise was born from our extensive experience in the aerospace sector, condition monitoring of Nacelle and Monopile structures, to visual, photographic and video. “Our experienced Renewables Team has worked alongside the world’s largest energy providers on some of the world’s largest projects such as the London Array, Gwynt y Mor, Whitelee, West of Duddon Sands, and Riffgrund.” Cole adds: “Renewables is a great new area because people come to us with their problems, and we have provided solutions for them. For example, in the last couple of years we have invested heavily in advanced technologies, much of which is developed and manufactured in-house in our extensive R&D facility. We have also invested in excess of £1 million in our bespoke rope access training facilities ensuring that we have the capability and capacity to continue developing our skill set to service this growing area.” Talent management The work that MISTRAS Group undertakes necessitates a well-
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educated, thoroughly trained and, similarly, there’s a large workforce with industry-specific number of people who have skillsets. With around 7,000 global been here for 20 plus years.” employees on its books (1,500 The company has solidly of which are based in Europe) invested in both practical and the resources and time that the theoretical training. Its rope access company dedicates to training capabilities are supported by a and employee development dedicated training centre certified cannot be overstated. by the Global Wind Organisation; Cole highlights that MISTRAS Group also investing in talent utilises a variety of development does online materials a lot more than for both training simply ensuring testing purposes a skilled in line with its workforce: “On global presence. Number of employees some offshore “Within the oil at Mistras Group projects, our & gas services employees might division we believe have had £20,000 strongly in training for into £30,000 spent on service inspection and regular training in the previous 12 months trade testing to ensure that not to get them to the level at which only are the technicians formally they are required to operate. certified but that they are also “Most of the people who work competent for the tasks that they for MISTRAS are very long term will be undertaking,” adds Cole. employees. We don’t tend to have a high staff turnover in Technology fact it is well below the industry Cole is keen to stress that the norms. I’ve been here since 1979 technology-intensive solutions
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MISTRAS GROUP
MISTRAS Group offers can save clients millions. He says: “If you look at the history of failures in process equipment, whether it’s power or oil and gas, there are far fewer catastrophic accidents today as a result of a more proactive approach to monitoring, inspection, and maintenance. “Go back 20-30 years and it was not uncommon for boilers to blow up; that never happens now because you will know when you have a leak early enough to take action. It’s the same if you’re doing structural monitoring - the advanced notice allows you to plan what you do and to mitigate the occurrence of further damage.” As a services-based company, Phil says, MISTRAS Group spares no expense when acquiring the latest technology in order to meet and exceed the evolving demands of the market but “if it doesn’t exist but we know what’s required” then
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the company’s engineers have the expertise and creativity to develop bespoke technological solutions. He adds: “If you can perform an operation non-invasively using automation that of course saves countless millions for the client. On the Gabbard wind farm we ran substantial tests and trials on five turbines in the first year as a sort of trial demonstration, to make sure the technology was working properly. We then made the necessary changes and expanded it to close to half of the current wind farm in the following years.” Having accrued nearly 40 years of experience, MISTRAS Group has grown to become a world leader in technology-driven asset protection solutions. The company’s expansion into the renewable energy sector – particularly offshore wind – has enabled it to weather the fluctuating oil price while strengthening its skills base and business offering.
ENERGY
“MISTRAS Group spares no expense when acquiring the latest technology in order to meet and exceed the evolving demands of the market”
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r o t a v o n n i y g r e n E on Written by Lucy Dix w Lloyd Produced by Andre
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FIRST UTILITY
In eight short years First Utility has gone from a handful of customers to competing with the Big Six energy providers in the UK. Business Review Europe discovers how technology has made this possible
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hen Bill Wilkins took on the joint roles of CIO and CTO at First Utility back in 2010, he was faced with two challenges: making the IT fit for purpose and also capable of scaling up as the business grew. The pilot platform First Utility originally deployed wasn’t performing as required, Wilkins explains, and he was asked to advise on the correct route to take. “The platform wasn’t scaling and the company was looking at re-engineering it, so I presented the founders with a plan and was asked to implement it. And it’s been a very exciting few years watching a concept with a small number of customers growing to the very large business is today with
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close to a million customers and £1billion in revenue,” Wilkins adds. First Utility was started by a group of smart investors back in 2008, looking to replicate the success they had already achieved in the telco industry, building an independent company and offering customers a different proposition. Initially, the company was all about smart meters and accurate billing – relatively new concepts at the time – and it is still, primarily, a technology company, although the product it sells is energy. As CIO and CTO, Wilkins says, he has two distinct roles. The CTO part of his role is about designing digital solutions around First Utility’s core energy proposition, and his
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CIO role is all about making sure that technology was never a barrier to what the company wanted to do from a business perspective. “When you go from nothing to a million households and from 30 employees to 1,400 employees, the scalability of the platform is a
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Number of employees at First Utility
very important factor in how quickly you can grow. So the CIO part of my role is all about delivering that robust, secure, scale, fit-for-purpose business. The CTO part of my role is about positively evolving the way our customers engage with their energy consumption and also with us. So that it’s more convenient for them, they get a better service experience
and ultimately they end up staying longer with us,” Wilkins adds. Research and development
And a pivotal part of this technology delivery is First Utility’s preference for investing in developing its own solutions. It has a Business Technology Group – carefully named by Wilkins to highlight that technology is at the core of the company and not just an internal service provider – that works collaboratively with and as peers of the other departments. “We have 203 technologists that work in the Business Technology Group so we invest quite heavily in building our own solutions rather than buying shrink-wrapped products from the marketplace.” This focus on developing solutions in-house is partly the result of necessity, Wilkins says, as eight years ago there wasn’t much out there already for the relatively new independent energy sector. “There aren’t many specialist software vendors that deal with how
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you support retail energy in the UK – because we couldn’t afford to go to SAP and buy their solution when we were a young company – so we had to hire a lot of smart software engineers and do a lot of that primary platform development ourselves.” In-house innovation
Keeping the software engineering team engaged has been key to enabling the flow of innovation, by providing regular research days
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and encouraging contribution to open source communities. A good example is the successful research and development project that resulted in natural language processing techniques that works out what a customer is asking for in an intelligent way. Wilkins adds: “It handles a good proportion of our inbound customer contact traffic now via mail but also in our mobile platform, so customers can chat to what they think is an agent but it is an artificial intelligence brain and it’s available 24/7 helping fix a direct debit, find out what the last bill was or even submit a meter reading.” It was important to Wilkins that Ask First, as this product is called, wasn’t seen by customers as a barrier to good service or as a deflection technique. He adds: “We wanted Ask First to actually answer the question, not just give back some standard request. So when we build a product, there is instrumentation inside the product to make sure we know who is using it and what questions they’re asking.
First Utility Helps Customers Optimize Their Energy Consumption Using DataStax Enterprise Company Background First Utility is the largest independent energy supplier in the UK, servicing more than one million households. The company is focused on disrupting the legacy, slowchanging utilities industry through innovative new applications that deliver total transparency and help customers understand and manage their energy consumption. First Utility has a number of “firsts” to its name: it was the first supplier to offer dual-fuel Smart Metering to UK households, the first to offer an consumer energy analytics platform and the first to offer fully automated video meter reads in its mobile app. Business Objectives – Drive Better Customer Experience Before adopting the DataStax Enterprise (DSE) distributed database platform, First Utility sought to achieve two main goals – develop a modern platform to support a disruptive energy startup through innovation and evolve a highly efficient business model that allows us to offer consistently market leading prices to our customers – DSE supports both of these strategies. First Utility drives innovation through applications such as “My Energy”, a core component of the company’s digital proposition that helps customers optimize energy consumption and lower their bills. Many households now use the Smart Metering service on a monthly and even weekly basis, and First Utility seeks to bring more of these value-added applications to its
customers via DataStax Enterprise. Each smart meter produces up to 17 thousands meter readings per year. Most households have two meters – gas and electricity – and First Utility supplies nearly one million homes. That’s a lot of data to store and process within the My Energy platform and doing it in an affordable way is why they chose DSE. “Investing in digital engagements creates higher customer lifetime value, and First Utility is focused on delivering applications that build trust and create long-term profitable relationships with our customers,” said Bill Wilkins, CIO/CTO, First Utility. “DataStax Enterprise offers the data scale and analytics capabilities we need to bring these new innovations to market.” DataStax Enterprise – Database for Cloud Applications First Utility realized it needed a new platform that could store and manipulate large amounts of data for their My Energy and other applications, so the company adopted DataStax Enterprise. DSE is a distributed database platform based on the open source Apache CassandraTM database. DSE’s masterless architecture ensures very high availability and linear scalability to support the uptime and performance requirements of cloud applications. First Utility was initially drawn to using open source Apache CassandraTM, but realized that DSE’s integrated Analytics capabilities based on Apache Spark provided functionality not readily available
elsewhere. The company also quickly realized that DataStax could help them adopt a “digital shift” mindset and adopt the skills needed to create next-generation applications. When first undertaking their digital transformation, First Utility considered utilizing prepackaged software solutions that did not address their broader data management ecosystem. However for the long run, the company wanted its own framework for creating new applications and pursued a database platform that could accomplish innovative application delivery. Results – Drive Customer Retention Since rolling out the data platform with DataStax Enterprise, First Utility has grown its footprint in DSE. It started as a strategy to support a modern innovative new platform. However success there has spawned the desire to bring the benefits to more traditional areas of Energy I.T. and have deployed the framework in the Customer Care and Billing platform – a mission-critical, business facing system. With DSE, First Utility was the first company to offer an energy data analytics platform that shows how much energy customers are using and spending to help them optimize their usage. First Utility can now see that customers who use the platform regularly use 5-6% less energy and save, on an average, £45 a year based on an annual spend of £900. Customers are also happier, and stay with them 60% longer than before.
EUROPE
We also track customers through our digital platform and through our voice platform so we know if they subsequently call back in. This way we know that people that use Ask First have a very high percentage of satisfaction.” Identifying differentiators
When choosing whether to invest in its own solutions or to work with what the market has to offer, the deciding factor for Wilkins is whether First Utility can differentiate in some way. It has its own modern technology platform that uses very few third party technology players and therefore has a very low cost of ownership associated with it, but there are solutions that First Utility looks to external partners for. Wilkins adds: “Typically, if it’s a generic requirement and we can access it at a decent price and we think the price scales reasonably with our business model then we will buy. We don’t want to build for the sake of building.” Building something bespoke together with carefully selected partners is also an option, and is
“We invest quite heavily in building our own solutions rather than buying shrinkwrapped products from the marketplace” what Wilkins decided to do with the customer billing platform when its own system was no longer able to cope with the company’s growth. “We scanned the market and we found a multi-product billing platform in Israel from a company called LogNet Systems. We had fewer than 50,000 customers at the time and LogNet was willing to work with us at our relatively small scale and treat us like a very important customer. So we then embarked on a three-year project to jointly develop a UK energy billing system - the system we’re on today - and one that we’re very confident will get us way up into the Big Six territories.”
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FIRST UTILITY
The Big Six he is referring to, of course, are the major players in the UK’s energy market including British Gas and EDF. So what does Wilkins think sets First Utility apart from these giants? From a business perspective, he says, it is the technology platform. “The economics of our technology platform is far superior because it’s more modern and with that comes cost advantage. Also, it follows that it is much more agile, much more nimble. Agile technical platforms enable agile businesses.” My Energy
The customer-facing My Energy platform, which was introduced in 2014, is another critical differentiator. It enables customers to understand their energy use in a way that can actually lead to savings. Wilkins says: “It shows you things like how you’re consuming energy versus people in your neighbourhood. Whether you’re more efficient or less efficient. It shows you how you might want
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to save energy through energysaving calculators. It customises hints and tips for you. It shows you how your bill will change over the next six months based on your individual tariffs and individual consumption levels.” It provides our customers tailored information that typically leads to a five percent reduction in energy use of those who sign up for it. Great for the customer and the planet – but also great for First Utility, as it is a popular tool. “It’s very clear from our analytics that the more time people spend on our digital platforms, the longer they stay with us and the happier they are with our service. Many companies would look at investing in something like My Energy, which is completely outside of the required for what you need to operate in the energy space, as a luxury, maybe not an appropriate use of investment. Actually, it’s turned out to be as we believed it would be: a very good business investment.” In 2015, video meter reading
capability was added, which means a customer can simply hold the camera to the meter to submit a reading through the mobile app. “Although we led the introduction of residential smart meters, we are pragmatic and realise that not every UK household will have one soon,” adds Wilkins. Another important area of focus for First Utility is optimising its business model. Wilkins explains: “Technology plays a lead role here, as you would expect. A less conventional approach is to risk using emerging technologies to reduce the footprint of expensive commercial software. An example here is the use of Cassandra and DataStaxx to upgrade our meter data management store – improving our scalability, performance whilst slashing our vendor costs.” First Utility also makes use of a cloud-based voice platform from LiveOps by Unify Communications. “Not owning a large data centre allows us to focus on our business and allow other professional organisations use their economies
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of scale to improve our efficiency. We have gone beyond using services like Amazon and Google for compute power and storage and use cloud-platforms for one of our most critical applications – supporting the voice channel for our customer contact centre.” Collaborative working
Wilkins also made the decision to put Google Apps inside First Utility, firstly because as CIO, he didn’t want to manage the email infrastructure. He explains: “In the same way I don’t want to manage the data centre or air conditioning or power supplies, as those things don’t differentiate us and there are experts out there already. Amazon is a great example: it knows more about how to do efficient data centre management than I ever will. And Google knows more about email and delivering a web-scale infrastructure for collaboration.” And Wilkins has witnessed a real transformation thanks to Google Apps, with staff working together,
real-time on shared documents, making use of Google Hangouts and even creating live broadcasts – Hangouts on Air – to run “townhalls” that update the business community on new innovations in data. It has also freed the company from what Wilkins calls ‘attachment hell’, which is an added bonus. The issue of scale comes up once again when the subject turns to the future of First Utility which, Wilkins says, includes the continual optimisation of its business model. “We have quite a large percentage of our resources analysing the data that comes out of our contact centre and our business process to see where the squeaky wheels are and see how we can automate better. To make us a more efficient machine.” The Business Technology Group will continue to focus on product development, particularly around mobile and My Energy, looking at what it can offer to First Utility’s growing number of customers.
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Growth during the downturn Written by Nye Longman Produced by Kymberley Page Moore
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HALLIBURTON
While many oil and gas providers are focusing on survival, Halliburton’s Canadian outfit is using the downturn as an opportunity to maximize its market share
“
We see Canada as a leading indicator of potential downturns on North American lands,” recounts John Gorman, Halliburton’s VP for Canada, who is optimistic about the future of his industry and the contribution his company can make to the future energy mix. “We started streamlining our efficiencies ahead of the curve, so at the time the downturn really hit, we were already on our path to creating structural differences within our organization to become a lower cost provider.” Like all companies facing the oil price downturn Halliburton faces a number of challenges, but the way it has gone about addressing them is unique. Coupling the latest technological advances in the industry with a competitive shift in the way it manages its supply chain, Halliburton has set the
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wheels in motion to make solid market and operational gains. “I think it’s really served us well, especially seeing as we are now coming into the second anniversary of the downturn,” Gorman adds. “Even before the downturn, our mantra had been to be the lowest cost per barrel provider in North America - Jim Brown is our Western Hemisphere President and he really focused on that as our primary driver. “From our high tech directional drilling and bit combinations to “Frac of the Future” technologies, we are drilling wells faster and producing more oil and gas per well to really improve our customers’ returns. At a time with economic challenges, this reduces the cost of services per barrel to the point where drilling and completion activities are justifiable.”
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Operations
Utilizing nearly a century of expertise, the company is seeking to extract the highest possible value from its assets in order to thrive during the downturn. It is achieving this using superior products, materials and equipment, staffed by some of the most developed and experienced personnel in the industry. Halliburton’s operations in Canada cover both conventional and unconventional oil and natural gas services. All told, the company’s Canadian business covers all facets of completion and production
services: hydraulic fracturing, cementing, production chemicals, artificial lift, drilling and evaluation services; drilling, drill bits, mud, landmark graphics and various offshore services and operations. Halliburton Canada’s operations are spread across Western and Atlantic Canada from Fort Nelson, BC to St John’s Newfoundland. The company has been present in Western Canada since 1926 when Erle P Halliburton sent his two brothers, George and Paul to Turner Valley AB to start the spread of Halliburton into an oifiled services company with global reach.
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Congratulations for 90th Anniversary of Halliburton Canada! Our JAPAN TEAM is very proud of contributing to Halliburton's success with our supply of Bias Unit Core components for Geo-Pilot® Rotary Steerable System*. Bridgers Co., Ltd. (Focal Point - Commercial) Yuichi Yamamoto, President & CEO
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Today, Halliburton is one of the largest oilfield services companies operating in western Canada providing excellent reliability and engineering to numerous customers from hydraulic fracturing to drilling. Halliburton has been present in Atlantic Canada since the 1970’s when offshore exploration activities around the Hibernia offshore oilfield were first kicking off. Nowadays, the company is looking forward to the Hebron platform work starting as they are well positioned with multiple services involved to make a big impact on that project. Gorman adds that alongside becoming the lowest cost provider, the oil price fall provided Halliburton with a chance to revamp a number of its operations and drill down on becoming a lean organization. A hitherto less explored activity that the downturn has necessitated is repurposing old oil wells which, as Gorman explains, has been an unexpected source of growth: “We believe we are going to grow out of the downturn. We have
actually had a better adoption of some new technologies like refracturing wells. One of our key strategies is coming back into wells and giving them a new life - very often back to production and very often with a lower decline curve. “If you can go into a well that’s already been drilled and recompleted - you can do it for half the price or less of a new drill and very often get close to the original production out of it. That is being brought into the business which really wasn’t there at all a couple of years ago.” From a strategic perspective, Halliburton’s presence in Canada presents the company with an opportunity to competitively grow its market share to make long term gains in a key territory. “Most of the strategies would be around market share growth. Given the depth and breadth of the downturn, growth in revenue or profitability is not a priority but we have been very successful at what we are aiming to do.”
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HALLIBURTON
Supply chain
As one of the largest players in its field, Halliburton recognizes the potential positive impacts of making its supply chain more efficient. Gorman explains: “Halliburton is a very large organization and from a strong logistics base. So when we focused on being the lowest cost per barrel provider we focused on the recovery factor of what we were getting out of the ground. “For example, we buy more sand than anyone else in North America including construction companies. You can obviously create some strong relationships with our vendors
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to be a very low-cost provider given the volumes we go through.” Remote technology also plays a role. From its real-time logistics center in Houston, Texas, Halliburton is not only able to track every truck and rail car in North America, it is also able to report on any delays or issues its cargo might be experiencing – in real time. “That also minimizes our trucking and rail costs and makes sure that we getting that product delivered when we need it,” Gorman adds. “If you look through a lot of our pipelines that are very product or manufacturing dependent, the more
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GEAR CUTTING
you can have a high turnover of equipment, you can accelerate your cash generation from making a very efficient supply chain organisation.” The company has looked at ways of increasing its production performance without reneging on its goal to be the lowest cost per barrel provider. A balance had to be struck. “We focused on trying to ensure that we have all of our technology resources available to make sure that our customers have the best technology to improve their production while keeping their costs at a reasonable level,” Gorman adds. Through Halliburton’s Guiding
Principles for Sustainability, the company continuously seeks to build on its role as an accidentfree, environmentally responsible company. It achieves this using a sixpoint strategy that covers financial performance, health, safety and the environment, global citizenship, transparency and collaboration with suppliers. As a member of the Dow Jones Sustainability Indices, Halliburton endeavours to integrate the above principles into a business model that manages social and environmental risks as part and parcel of delivering long-term shareholder value.
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Exceptional product access to the world’s leading chemical manufacturers. Powerful perspective and market insight from our strong network of sourcing professionals. Unparalleled scale and connectivity across geographies.
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set up Halliburton University – an With over a century of experience online learning system that enables in the industry, Halliburton knows employees to document career how to develop a skilled workforce achievements while learning for roleacross its field operations, based competencies, competency manufacturing and professional assessments, and technical training. roles. Its current talent management It also provides a wealth of online strategy is focused on maintaining courses. The company is also its career and management keen to foster the next generation programmes while of talent; it offers making necessary positions within adjustments to its operations for remain competitive recent graduates or during the internships for those downturn. still to complete With upwards their studies. of 20 training Gorman adds: “From Number of employees facilities across a career progression at Halliburton the world, the perspective, we company provides develop high technical, operational and potential employees and we have a leadership training. Complementing partnership with the Mays School of myriad development programs, Business at Texas A&M University the company provides a where we provide financial and number of fast-track career business leadership training. While development opportunities. there has been a need to cut costs Keen to provide broader and in other areas, we have kept the more immersive access to its Texas A&M training as part of our educational initiatives, the company core leadership training initiatives. Talent management
50,000
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HALLIBURTON
Through the President’s Leadership Excellence Program, Halliburton selects 30 of its most capable candidates and, after vetting from the CEO, trains them to fill top management positions within the company. “We train them to become the next leaders of the company. Very often in organizational announcements, you will see ‘graduate of 2000 and whatever year of class’. This is something we are very proud of; we have a great partnership with Texas A&M,” Gorman says. Given the cyclical nature of the oil and gas industry, attracting, developing and retaining the best talent comes with a number of challenges. Gorman and his HR teams have overcome this, however. Given the downturn, the company has had to look very hard at which staff it keeps on its books. Gorman explains: “We are in a very cyclic industry and have to balance the current needs of the business with its future needs. It’s
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always a challenge to determine how long a cycle will last and what sort of structural changes we can make to the business in order to improve our own economics. It’s a challenge for the entire industry.” Having refined an already highly effective business into an even more efficient operation, Halliburton’s Canadian operations are set to play a crucial role in the country’s energy mix for years to come. Gorman concludes: “I truly believe that Canada does the best job of being a very responsible environmental citizen and is embracing some of the most environmentally friendly produced oil and gas in the world. “As Obama recently said during a meeting with Prime Minister Trudeau - the world needs more Canada and I think the world needs more Canadian oil and gas.”
“Through the President’s Leadership Excellence Program, Halliburton selects 30 of its most capable candidates and trains them to fill top management positions”
Mind the gap: S2NRG & solving the renewable energy gap
Industrial assets can be sources of huge amounts of energy tr generated from the underutilized assets of the facility, represe is what S2NRG refers to as Industrial Renewable Energy, and Hybrid Energy technology platform designed to extract these sale to the grid. They believe that this approach will help to so Written by Dale Benton Produced by Kymberley Moore
rapped within the industrial process or enting major untapped sources of energy. This the company has developed the Integrated trapped energies and release them for olve the renewable energy gap.
S2NRG
“Even though we are using conventional technologies to do this, we are configuring those technologies in novel and innovative ways that allow us to have a holistic approach” – Gregg Bauer, Managing Partner
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“W
e saw an opportunity in very large industrial commodity companies like steel aluminium, glass and cement, to recover energy that is lost in the form of heat or from flammable gases the are emitted by the processes,” says Gregg Bauer, Managing Director and one of the founding fathers of S2NRG. “Our concept is that we can use conventional technologies to capture the Industrial Renewable Energy that’s being lost or wasted and combine it with traditional renewable energy from PV solar, wind turbines etc. installed on the sites and integrate those two forms of renewable energy together to produce what we call Integrated Hybrid Energy.” S2NRG as a company was founded after Bauer and his business partner Mark Roth were working on a project for a large steel company. Together
they realized that it wasn’t really sensible to be burning precious natural gas to produce energy or installing greenfield solar and wind facilities in locations where people don’t want them when this untapped energy source was readily available. “Nobody cares if you put something like a solar field or a wind facility on a steel mill site because they are generally ugly anyway,” says Bauer. This eventually brought them into the path of the founders of Dutch company The Source, Michel van Honk and Maurits van Oranje. The Source had been pursuing renewable projects in markets such as Brazil and Africa which was believed to be a good target for the new founded company: S2NRG. Based in Amsterdam and with a core operational office for the US, located in Boston, US, S2NRG now
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has operations in Europe and over the last five to six months began operating in Rio De Janeiro, which the company is using as a launch pad for the South American market. S2NRG believe that industrial assets can become sources of power, which they call Industrial Renewable Energy. “Is it green? If we increase the efficiency of how fuel is used by three times and reduce the carbon footprint of a complete facility, then it sounds pretty green to me. One of our core missions really is to carry forward this new concept where the market begins to recognize it as being really renewable,” says Bauer. “With more and more traditional renewable produced energy (solar and wind) coming online, the stability of the grid becomes more and more a problem. Energy can’t be stored. S2NRG refers to this as the renewable energy gap. “Industrial renewable energy
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plays an important role in this stability problem. Our capacity is constant and available 24/7.” Dealing with development Bauer admits that development is a complicated business, with a key challenge being geographical locations and whether to enter that specific market. “It’s a heavily knowledge-intensive business, both technically and commercially, and you have to go to the places that have the right conditions. So these large industrial plants need to be located in an energy market that makes our projects economically viable, a regulatory market that is supportive of these projects and you need relationships with the most senior executive of the industrial host,” says Bauer. “And what certainly will help is the aspiration of many grid operators for stable distributed
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“Is it green? If we increase the efficiency of how fuel is used by three times and reduce the carbon footprint of a complete facility, then it sounds pretty green to me” – Gregg Bauer, Managing Partner renewable energy production.” S2NRG is still a young company, and Bauer admits that their hands are full; with pipelines in the US, in central and eastern Europe and in Chile and Columbia, the company has full schedule. However, he says that as the company continues to grow there will be opportunities to expand. “As the company grows and we raise more capital there will be other markets that are attractive which we will then consider,” he explains. “But they will need to fit that criteria where we know that we have the correct resources and the correct relationships and commercial environment for that to happen.” The cost of capital One of the major questions that arise from any form of recycling or renewing
energy use, how does the company or the industrial host make money out of this? The answer is simple: the energy is served out to the grid, with the industrial host receiving royalties. “We integrate the energies sources in such a way that we maximise the economic benefit of the energy coming out of our plants to ensure that we are getting the maximum benefit of the real time energy market while allowing the hosts to modulate their process where possible, where it makes more sense to sell energy than it does to produce say, aluminium,” adds Bauer. Think of it as demand management taken to another level. These projects are funded by large energy private equity groups like EIF/ Ares. S2NRG shares the economics from the sale of power between the energy private equity groups, who own
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the power facility, and the industrial host in return for allowing the company to use the underutilized assets. This business model has proved hugely successful thus far for S2NRG. “The hosts like it because it comes to them as EBIT, the very purest form of economics that you can get – they have no cost of capital, no operating costs and no COGS. The private equity firms like this model because it gives them interesting new distributed power plants to invest in that they wouldn’t normally have access to,” says Bauer. “They also like it, because since we are not having to acquire land, we are able to reuse permits that our hosts have in place, our interconnect costs are much lower because the hosts have back connects to the grid. This allows us to connect in and back feed to the grid from interconnections already in place. Our cost of fuel for all intents and purposes is nearly zero
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– because we are using energy that is being wasted by the process anyway. “It’s a subsidised cost of fuel because the host gets a royalty, but the cost of fuel is essentially zero so it makes these plants very
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economical to put in place because the cost of development and building are much lower. The cost of operating them are much lower, presenting a superior economic situation to our collective partners.�
Collaboration: the key to success Partnerships and relationships with customers is crucial to the success of S2NRG. Bauer recognizes this and calls
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Industry Energy
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upon the importance of collaboration. “One of the most important relationships to us is with the energy private equities/capital markets. We view them as our customers, we view the industrial hosts as our partners,” he says. “It’s a constantly moving process. All of us have very deep networks and relationships with senior executives at the larger industrial companies. Where we spend a great deal of our time is nurturing and maintaining and supporting the relationships with the energy private equity companies.” Governments and local authorities also play an important role, their wish for efficient renewable energy production
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and economic development is evident. Collaboration with them on the right levels is another key to the success. A system perspective As a relatively young company trying to carve out a market for themselves, such a venture provides various challenges, as development companies are considered as risks. S2NRG is not just a development company, it has its own Integrated Hybrid Technology
systems for combining two sources of energy, and with this comes even further challenges – engineering how to configure these technologies for its projects. “The magic behind what we do is to look at the industrial facility from and engineering systems perspective. This allows us to conceive systems solutions that are just not possible when individual processes are considered. Even though we are using conventional technologies to do this, we are configuring those
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technologies in novel and innovative ways that allow us to have a holistic approach,� Bauer continues. A novel idea Novelty is one thing, but standing tall
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against competitors is another. Bauer believes that what separates S2NRG from other development companies is the innovative business model. Larger existing energy development companies will normally ask for the
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industrial hosts to invest capital, or to sell the energy to the host, something which what Bauer describes as “very difficult and challenges the economics for the project”. “A typical energy development company has a core financial focus, that’s not what we do,” he says. “We have the profiles of competent systemthinking industrial professionals, which allows the company to go into industrial processes and look at them from a completely different perspective,” Bauer states. What makes S2NRG different is its ability to provide a solution for multiple audiences. “If you ask the capital markets, it’s our relationship with the industrial hosts and our ability to connect at the highest levels and to have the conversations that we can have. “If you ask the industrial host, it’s our relationship with the capital market. There’s no magic
to what we do, but there is some secret sauce and our integrated hybrid technology platform.” Moreover, the private equity firms like this model because it gives them interesting new distributed power plants to invest in that they wouldn’t normally have access to. In creating a market, new entrants are a certainty. But this is actually part of S2NRG’s long term goal. “We want to declare the market of Industrial Renewable Energy, carve out space for other developers who can join us in this market and rely on licencing our technology,” Bauer states. “Development is means by which to get our technology to market, but in the end of the day if you ask the founders what S2NRG is about, we will tell you it’s an industrial renewable energy company with a core patented technology that enables that.”
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A water business for tomorrow Written by John O’Hanlon Produced by Josef Smith
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George Theo CEO of Unitywater
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Unitywater operates in the heart of a booming sector of South-East Queensland. The water and sewerage utility is perfectly placed to leverage its youth and agility to meet the immediate needs of a growing population, while maintaining a sharp focus on the future.
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nitywater was born against a backdrop of unprecedented industry reform. In the early 2000s, the Queensland government made a decision to consolidate water and wastewater services, which previously had been the responsibility of local councils within South-East Queensland (SEQ). Australia had just endured the Millennium Drought, Queensland had suffered a full decade of record low rainfall and water security was the driving force behind much of the era’s decisionmaking. The political intent of Queensland’s water reforms was therefore to effectively droughtproof South-East Queensland. In July 2010, Unitywater was established as part of this water
reform programme, as the entity that provides water supply, sewage and trade waste services to residential and business customers from Noosa in the north to Moreton Bay and the boundaries of Brisbane City in the south. In 2012 it was placed under the leadership of CEO George Theo, who brought a unique understanding of Queensland’s water challenges through 25 years’ experience in key roles within the water industry. As it has been set up, Unitywater now has just three shareholders: the Noosa, Sunshine Coast and Moreton Bay Councils, themselves reconfigured under a recent amalgamation programme. It purchases bulk water from South-East Queensland Water (Seqwater) and distributes it to
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Industry Leading Technologies Through Strategic Partnerships
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some 750,000 residents across the region. Another important part of its work is to collect, treat and dispose of sewage. George Theo walked into a very complex situation when he took on the role of CEO. Unitywater was an amalgamation of six local authority water businesses serving the heavily populated and fast-growing area of South-East Queensland to the north of Brisbane. Moreton Bay Regional Council, for example, has
the third largest population of any local government area in Australia. A lot of hard work lay ahead, he recalls: “We had inherited legacy and multiple technology systems that had to be replaced with fitfor-purpose systems – and we had to rationalise our accommodation as well as our extensive fleet of vehicles, plant and equipment. As an example, we were working out of 18 separate buildings; now we have just four.” In front of him lay
Maleny Sewage Treatment Plant
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the task of creating a refreshed, agile and people-focused business. The technology challenge The legacy systems in use back in 2010 included two asset management systems, no fewer than 11 different supervisory control and data acquisition (SCADA) systems to remotely monitor and control water and sewerage assets, two geographical information systems (GIS), two people management and payroll systems and two finance platforms. On the other hand a proper document records system was non-existent, and the process for managing customer bills on a daily basis linked to consumption was inadequate. Clearly it was vital to replace the old technology systems with best-of-breed software. Theo saw this as an essential part of the strategy to place Unitywater’s customers at the heart of the business by improving their customer experience with the organisation. The last six years have seen a huge amount of time and effort going into
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the task of transforming the IT platform and creating an agile and forward-thinking identity, and an inclusive culture. The company delivered a consolidated asset management system based on IBM Maximo and ESRI ArcFM, a geographical information system to replace all those legacy systems. The result has been that staff working on managing the network, its treatment plants, its remote pump stations and water and sewerage fittings are able to tap in on portable devices to look at the condition of the assets, capture further information on condition and performance of assets and at the same time plan and cost any interventions that may be required. Our field workers are no longer just maintenance workers, he says, but information workers. “In SCADA alone we are now monitoring more than 1,000 different sites and operating them remotely using ClearSCADA installed by the IT automation specialist AIT. We have a human
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Unitywater has made their customers’ experience an essential part of their strategy to improve the utility’s infrastructure
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Transforming Utilities.
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resources information system (HRIS), and a single documents management system from Sydney-based Objective Corporation.” This year, the organisation rolled out a business intelligence platform which is all about leveraging technology to achieve efficiencies. A prime example of this is the current campaign to encourage customers to move from paper to electronic bills. Already more than 68,000 of 300,000 account holders have signed up to e-billing. “We are working hard to raise that number significantly. It’s all part of our goal to be a hassle-free business for our customers. We compare the Unitywater customer experience with other leading-edge service providers in banking, insurance, airlines and the like. They are our benchmark, not other water companies.
68k+ The number of customers with e-billing accounts
Unitywater’s e-billing service
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Digital technology is at the forefront of change, so we have embarked on a programme to make our website and online tools as simple as possible for our customers.” Efficient – and green The technology transformation delivered a reduction in staff numbers from around 835 in 2010 to 708 today. Over the last six years A$133 million of operating cost has been taken out of the organisation, and in the same period capital expenditure has come down by more than A$150 million each year compared to when the organisation was formed. Energy is a big part of
the cost of running a utility company, he points out, and in a programme to optimise the largest of Unitywater’s 17 sewage treatment plants (STPs), and the hundreds of pump stations he notes that in the last year alone A$1.2 million was saved on electricity cost. Solar panels have been installed on the roof of one of the main administration buildings, saving 25 percent of its electricity use, he says. “At the same time we have looked at challenging the institutionalised operating arrangements in our network of water supply and sewerage assets, which has led to reconfiguring processes within the sewerage treatment plants, and taken a critical review of the way water and sewerage is transported through the network.” Over the long term, there are opportunities to make even greater savings at the STPs and within the network. One major investment currently being considered is a wasteto-energy facility at
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Solar array at Unitywater’s Northern Service Centre the Kawana sewage treatment plant: scheduled to open by late 2019. The plant will take the biosolids from other STPs and will also be able to use the fats, oils and greases generated by trade waste customers. “One of the goals we have as an organisation is to minimise our environmental footprint,” says George Theo. “The new plant will reduce our reliance on coal-fired plants. If we can find enough smart ways to generate energy we aim to become selfsufficient in 10 to 15 years. Over
the next three years though we will reduce our electricity consumption by 30 percent at this plant. In the future we may also produce enough bio-gas to potentially run a fleet of buses and vehicles. Imagine taking the number 2 bus powered by bio-gas from a local sewage treatment plant, now that would be something!” Another STP, at Maleny, won the award for Best Specific Environmental Initiative at the UN World Environment Day Awards, presented in Melbourne
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in June 2015. The award recognised a A$17 million investment in the plant, which uses a membrane bio-reactor to treat effluent to a very high standard before sending it to a newly created irrigated rainforest and wetlands area in the district. While he is very content to win awards of this sort – and with more than 30 in its pocket, he admits that looks like an addiction – what really makes him proud is the knowledge that while back in 2010 most of the STPs were non-compliant with their licence obligations, they are all fully compliant today. “Maybe the biggest achievement on the STP front though was that we turned one off! By reconfiguring three plants, we were able to close one of them completely.” That project won Unitywater the
30+ The number of awards won by Unitywater for its projects
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national Infrastructure Project Innovation Award at the 2016 Australian Water Awards. Training to succeed Theo set out to create a unified Unitywater culture based on the way the new organisation wanted to do business and to be recognised for a workforce that is safe in the work it does, agile, innovative and reliable in delivering customer and environmental outcomes that are wanted. The IT transformation is part of the new thinking, he says: “We need people who can respectfully challenge the status quo and be comfortable in the big data world by developing the
skills they will need to succeed. Are we ready to meet those challenges? We are heavily investing in and supporting our people to make sure they have every opportunity to succeed.” The better equipped they are, the better they can face up to the exponential growth of technology, data and customer expectations, he believes. That’s why training has taken a front seat. It’s vital that all our people understand that Unitywater wants excellent leaders, why? Because the workforce deserves to have excellent leaders.: Leadership can be learnt, he believes, and he has brought in a leading organisational psychology
“We have seen better decision making, better engagement, and people adding leadership to technical skills and enjoying the challenges before them” – George Theo, CEO Unitywater
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Unitywater Contact Centre company Change Focus to deliver a programme that uses well proven tools to make people aware of their leadership qualities and use them consciously. These include 360-degree feedback from peers, managers and subordinates. “We have given 100 people who have leadership roles within the organization objective information based on the feedback from the people they work with, then buddied them with organisational psychologists who give them one-to-one
coaching over twelve months. Then we go back at the end of that period and re-run the 360 degree feedback.” This, he adds, reveals managers’ blind spots. “We have seen better decision making, better engagement, and people adding leadership to technical skills and enjoying the challenges before them.” In the fabric of the community Queensland has invested heavily in desalination plants, and notably, the state has installed a A$9 billion pipeline
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interconnector linking Noosa in the north to the Gold Coast in the south. “There is plenty of secure water for customers now – and we are finding the average water consumption is declining year on year. The experience of the millennium drought changed behaviours and instilled a greater value in the mind of the public on how water is best used,” Theo reflects. George Theo is passionate about corporate excellence, but his eyes really light up when he starts talking about community engagement. “We don’t want to be just someone you get a quarterly bill from.” His headline initiative is the under-resourced, under-the-table issue of domestic violence, and supporting one particular
“The experience of the millennium drought changed behaviours and instilled a greater value in the mind of the public on how water is best used” – George Theo, CEO Unitywater
Laboratory staff testing water quality
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women’s refuge in Queensland. “It’s a safe place for women and their children to escape to – some of them are fleeing quite horrific abuse.” Unitywater prides itself on its good gender balance and equal opportunities but facing the statistic that one in four Australians have either experienced domestic violence or know someone who has, a number of our employees must come into that category – and the rest need to be made
aware. As well as giving direct support to the refuge, Unitywater has programmes to teach staff about healthy relationships and raise awareness of the issue. “I am really pleased that we are taking a stand on the issue of domestic violence in our community,” he says. He wants his two young daughters and all young Australian children to grow up in a society where abuse is never tolerated. The list of Unitywater’s social Creekside Greening Pine Rivers
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Deception Bay Men’s Shed members with Unitywater CEO George Theo engagement programmes and sponsorships is a long one. In 2013, it became a corporate sponsor of WaterAid, providing vital funds to help the charity improve access to safe water, improved hygiene and sanitation in the world’s poorest communities. That’s a global initiative, on a local level it likes to bring local people and bush care groups together to support initiatives like the Creekside Greening programme. Native seedlings are planted in
reserves and wetlands, resulting in improved water quality and habitat regeneration for a variety of wildlife. Unitywater also commits to sponsorship of local Men’s Shed facilities, which contribute to improved mental health and wellbeing of retired men, as well as a programme that gifts free books to children to improve the literacy of pre-schoolers. In a higher-profile gesture, the company doesn’t mind making some of its facilities available for large scale artwork
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“We are an innovative company with energetic and passionate people who are always challenging the status quo. We want to continue to deliver minimal price increases through efficiencies and operational excellence” – George Theo, CEO Unitywater
Point Cartwright Reservoir with its artwork complete
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– the Ferny Hills, Caloundra, Peregian Beach and Pt Cartwright reservoir artwork projects have engaged whole communities and at the same time turned bland concrete reservoirs into bright pieces of eye-catching public art. On the lighter side of social engagement, Unitywater is reaching its future customers through their universal passion, sport. “We are distributing tens of thousands of Unitywaterbranded drink bottles through sporting clubs and we want every child in the region to have one. We also sponsor scoreboards at small locally run football and cricket grounds. We are keen to be seen as part of the fabric of the community.” Another initiative in the pipeline is to allow each of Unitywater’s employees the opportunity to take a day out on full pay to volunteer with local charities and community organisations. There’s a sound business case for all these initiatives, George Theo concludes. Inclusiveness, of employees and customers,
is part of his vision for the company, reflecting the way he wants it to be positioned. “We are an innovative company with energetic and passionate people who are always challenging the status quo. We want to continue to deliver minimal price increases through efficiencies and operational excellence.” “We may be the only water partner our customers have for now, but that could change, so we treat our customers as if they could walk out at any point in our relationship. We’d like our customers to become our advocates so that when things go wrong, as they sometimes do, they will say that Unitywater is an excellent company that puts things right, listens, and always responds positively.” Theo says: “We want to be different and we are keen to create something special at Unitywater that everyone can be proud of.”
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MOVING FROM P R E S E R VAT I O N T O I N N OVAT I O N
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