Accelerating the commercial adoption of innovation

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Moving from prototypes to commercial adoption is a huge challenge for most entrepreneurs. Many large industrial companies are acutely aware that breakthrough solutions often originate from outside their operations and that to stay competitive, they must ‘channel in’ transformational innovation. However, it’s often the case that there remains a gap between the innovator and final adopter, with industrial companies lacking confidence to take a risk on a solution unproven at-scale, delaying technology adoption across industry and stalling the pace of decarbonisation.

The UK government is bridging this gap through its Industrial Energy Efficiency Accelerator (IEEA) programme which helps entrepreneurs demonstrate step-change efficiency technologies at scale in real operational environments.

Over a two year period, 16 industrial innovators have received government and private sector support to enable the development and demonstration of novel technologies with serious potential to boost the energy efficiency, and reduce the carbon emissions, of industrial companies globally – both large and SME.  We spoke with some of the IEEA innovators in sectors ranging from food processing and energy storage, to wastewater recycling, to hear more about their experiences on the last mile to commercial adoption. 

Earning credibility

The first challenge that many innovators face in getting their solutions to market is earning credibility with customers – often large, established industrial companies. These companies already have a laser focus on bottom line efficiency having, in many cases, honed their operations over decades. Introducing innovation in this environment can be highly challenging, as wastewater filtration innovator G20 Water Technologies can attest.  “We've got some very clever people and great technology on paper, but we’re essentially a micro company. Our project is targeted at the industrial laundry sector, which is a small industry. Everybody knows everybody and everybody can reference previously failed filtration technologies in that sector, so there's a pre-existing scepticism around the ability to deliver,” said Craig Clement, Chief Operating Officer, G2O Water Technologies.  
“With the Carbon Trust’s support, we put together a detailed measurement and verification plan, clearly showing that the proposition is real. Having that strong data and industrial validation is really critical to generate enough traction to move onto the next level.” 

Craig Clement, Chief Operating Officer, G2O Water Technologies

  Through the IEEA, G2O Water Technologies, and its partner Hydrasyst are working with Johnsons Textile Services to demonstrate how their laundry filtration technology could recycle significant amounts of laundry effluent water, potentially saving hundreds of thousands of pounds. A clearly defined value proposition – modelling the potential economic impact of its solution - was vital to their partnership with industry, as Clement explained: “Within the IEEA, we spent a lot of time modelling and tracking the possible savings. With the Carbon Trust’s support, we put together a detailed measurement and verification plan, clearly showing that the proposition is real. Having that strong data and industrial validation is really critical to generate enough traction to move onto the next level.”

Engaging a customer champion

It is human nature to stick with what we know – and in the industrial sector, a focus on incremental efficiency gains can slow the adoption of disruptive innovation. To overcome inertia and address scepticism, a strategy adopted by some innovators has been to engage a customer champion who understands their technology’s potential and who holds influence at the boardroom table.  To engage the right people, innovators usually need to cover a lot of ground within the customer environments – from operations, technical, engineering, finance to supply chain. Navigating this complexity successfully demands that trust is earned with C-level supporters.  “A customer champion is key to overcoming the challenge of introducing innovation in the corporate environment. Having a strong relationship with a champion that can represent your technology is key to getting access to the budget holders and decision makers within the corporate environment,” said Simon Branch, Chief Executive, Innovatium which is demonstrating its Liquid Air Energy Storage solution in a major industrial site at Aggregate Industries.

Laser focus on integration

Once an innovator has managed to get their technology onto the radar of a corporate, innovators must quickly broaden and deepen their knowledge of the customer’s systems, to strengthen the business case for potential scalability. “You must strongly communicate your technology’s financial benefits and quickly establish what the scalability is within that industry. Initially, for example, our technology was piloted in an aggregates quarry. However, clearly cement production is also a massive energy user, so we immediately started exploring those opportunities. Naturally, the operational managers are production orientated, but energy is also a key concern, so it didn’t take us long to build a financial case for a second application,” says Branch. Evergreen Water Solutions has developed a novel solution for cutting the energy costs of the ‘dewatering’ process, commonly undertaken in the water sector, by up to 90%. Through the IEEA, the company successfully partnered with United Utilities to co-fund a £1.5m demonstrator project. The company’s Managing Director, Robert Mannion, sums up the innovation challenges they faced in demonstrating the potential for their innovation to scale.  “There’s a very strong link between innovation and integration. Adoption doesn’t just depend on what we produce, it's how we integrate products into the plants and also the peripheral equipment around the process. There's no point having a great product if the pump regularly breaks down. Ultimately, your product is judged on the performance of the peripheral equipment that works with it, so the peripheral equipment that you select must be fit for purpose.”

The ‘race to be second’

The largest barrier entrepreneurs face in earning acceptance for their technologies is being able to demonstrate solutions at scale. A common theme highlighted by the IEEA participants is decision makers adopting a ‘race to be second’ mindset to limit the inherent risk of technology adoption.  Many industrial corporates don’t want to be first. Indeed, many would prefer to be third, fourth, or fifth so, from a customer perspective, it’s critical to ensure the technology is completely proven before buying. Typically, full-scale demonstration projects can cost between one to three million pounds to set-up. To overcome this major financial barrier, the IEEA provides part-funding for demonstrations to help to deliver all-important technology validation. While economic modelling is vital, seeing that first plant built is an invaluable driver of credibility. LAT Water, for example, was awarded nearly £548,000 of IEEA funding covering nearly 60% of the cost to demonstrate its wastewater recycling technology to global waste management company, Viridor.  
“It’s crucial for the customer to see this substantial piece of equipment doing what it says on the tin.”

Mark Hardiman, Chief Executive, LAT Water

  Mark Hardiman, Chief Executive, LAT Water, explained: “The great benefit of the IEEA, is that demonstration funding allows you to actually build and show a major piece of hardware – and that really satisfies the customer. The actual process of it working may not be terribly exciting. But just for its sheer presence it’s crucial for the customer to see this substantial piece of equipment doing what it says on the tin.”  Agritec Systems, which is developing an innovative low temperature animal by-product processing technology, agrees on the potency of demonstration to drive adoption. “To us the industrial demonstrator project is absolutely essential,” said Karl Shaw, Operations Director, Agritec Systems. “It creates the forum for us to talk about what we think we can do – to model it, with 3D Virtual Reality and lab-based trials. But to actually build a plant that will take feedstock; produce energy; put power back to the grid, it's something you cannot argue with. We could argue how good we are and what we can do, but actually having working equipment physically there in front of a customer, that’s absolutely key to engagement.”

The shifting industrial mindset

The accelerated learning that entrepreneurs and corporates experience within the IEEA instils a system-level view of how technology can be integrated into complex, global value chains to transform energy efficiency, while protecting and even enhancing production. The industrial sector is recognised as a particularly ‘hard to reach’ sector from a carbon mitigation perspective, yet, from their exposure to corporate leaders, IEEA participants reveal an encouraging appetite for change in the space.   “New technology is always difficult to implement,” said Shaw. “Most of the discussion used to be wholly focused on capex, but now it's about opex and capex together. There’s a greater appreciation of the lifecycle of equipment. Through understanding efficiency gains from new technology over the short, medium and long term, the process of replacing inefficient plant machinery is accelerating.” Industrial transformation cannot come from the invention of new technologies alone; it also depends on a collaborative process of adoption to reduce risk. To decarbonise the industrial sector in line with net zero ambitions, companies and innovators must come together to co-create business cases for demonstrating and ultimately integrating new equipment. In this way, we can overcome incrementalism and accelerate transformation, to improve efficiency, reduce energy consumption and emissions, and create jobs and revenue.
Find out more

Industrial Energy Efficiency Accelerator (IEEA)

Insight: Innovators lead the charge on industrial energy efficiency