Energetix treads green path for energy

By Andrew Bounds
Published: February 15 2009 21:34

Adrian Hutchings, chief executive of Energetix, has a simple explanation for why so few green technologies have succeeded. “They are too complicated,” he says bluntly.
The man running a business that has just starting marketing three energy-saving devices should know.

Mr Hutchings once worked for BNFL, the UK’s nuclear operator, on future projects. His team focused on how to generate power in the event of a reactor failure. One device was a flywheel for storing electrical energy that was technically perfect but hideously expensive.
“I had 30 PhDs working for me but no marketable product,” he said.
With Energetix, which he founded in 1997, Mr Hutchings decided to focus on simple solutions to obvious problems based on existing technology. Twelve years later, the company has three subsidiaries making products that are all set to come to market at the same time.
Genlec produces household combined heat and power boilers. The gas boiler generates electricity as well. Daalderop of Holland has already agreed to field-test the units and is expected to order 30,000 over three years. The boilers are more expensive than conventional ones but will pay that back in savings in about three years. Eon UK, the power supply company, is also testing a version.
They are the same size as conventional boilers so can be slotted into the same space in homes. “When you have to change the way the world works, it is very difficult,” Mr Hutchings says.
In the EU, 7m boilers are sold each year with a value of £8.1bn ($11.5bn) and the UK is the biggest market.
Pnu Power, the second business, provides back-up power devices based on compressed air. They would replace battery generators on mobile base stations and computer data centres and eliminate the need to replace batteries.
US companies and Eskom in South Africa are already using them. This month, Telecom Italia placed the first European order.
“We are taking a well understood technology and turning it on its head,” says Mr Hutchings.
VPhase, in which Energetix has a 49 per cent stake, makes voltage regulators that reduce domestic electricity consumption. The average UK supply is about 250V but most devices work at 220V to satisfy European guidelines.
Despite increasing staff numbers to 37, consolidating management has helped the company conserve needed funds.
Although it has raised £21.5m since listing on Aim in 2006, the market remains jittery. But Energetix’s shares have fallen less than peers – from 109½p to 32½p over the year since last February, leaving a market capitalisation of less than £20m, below the value of its VPhase stake and £13m cash pile.
It is fully funded, raising £3.5m in May last year for VPhase, and Mr Hutchings believes will soon turn its first operating profit.
Copyright The Financial Times Limited 2009