S U S TA I N AB L E

THIS IS ENERGY & ENVIRONMENTGood people do their best work in Wales

Minesto’s environmental ambition

Freudenberg: quality and reliability

Sure Chill’s fresh thinking

Riversimple’s radical ambition

2 | Energy & Environment 3

Situated at the western edge of the United Kingdom, Wales is a country that forms part of the UK and has a population of three million people. Geographically, it has a long open border with England, allowing free movement for centuries. Since 1999, the country has had its own devolved government, with control over econom-ic development and spending. However the first Japanese investor came over 40 years ago. Wales has been welcoming businesses and helping them grow for a long time, which means that businesses that come to Wales have easy access to the UK market, with its population of 65 million. Crucially, they have access to a supportive devolved government, which has the ability to make things happen quickly. “There is no doubt in my mind at all that in Wales we’ve achieved a much greater and wider network of relation-ships,” claims Hugo Spowers, founder of Riversimple, and inventor of hydrogen fuel cell car The Rasa. “What’s more, we’ve done so much, more quickly than we would have been able to elsewhere.” Many of the world’s biggest and most innovative companies have thriving operations here, including Hitachi, RWE Innogy and Veolia. These compa-nies are attracted to Wales for a variety of reasons, but some of the main ones are the quality of the workforce, links to good universities and higher productivity levels.

Around 58,000 people work in our Energy and Environment sectors in Wales, generating over £4.8 billion in sales. Rapid innovation is taking place in areas of marine energy initiatives and low-carbon projects. Our unbeatable natural assets mean our wind and marine energy subsectors are growing fast. Utility companies are investing in sustainable energy sources. Our deep sea ports are equipped to support renewable projects. The whole nation is working to eliminate landfill by 2050 and Welsh Government has pledged to make Wales a low-carbon economy. Oil, gas and nuclear companies remain important elements to the Welsh economy, with 20 per cent of the UK’s fuel supply passing through the port of Milford Haven. The country’s nuclear power sector is in a transition phase, with a mix of decommissioning, existing generation and new-build projects. Over 1,500 Environmental Services companies in Wales employ over 24,000 people across industries including land reclamation, waste and water, and support from professional services firms. “It adds up to a compelling offering for business managers and owners,” says Dr Martin Edlund, co-founder and CEO of Minesto, creators of The Deep Green underwater power plant project off the coast of Anglesey. “The combination of different gov-ernmental organisations all being on

I N N O V A T I V EI N T E R N A T I O N A LI N S P I R I N G

Wales is one of the first countries in the world to have sustainability written in its statute and continues to steer its economy in interesting and innovative new directions.

8 universities

Wales is well served by its eight universities, some of which rank in the top 8 per cent of the UK league tables for many subjects.

The Welsh Government spends about £15 billion a year on services and capital.

££15B

Businesses that come to Wales will have easy access to the UK market, with its population of 65 million people.

65M

the same line and vision has been very obvious. It’s been a clear path that fitted well into what we are trying to do.” The UK is the number one destina-tion in Europe for US foreign direct investment – and companies that come to Wales will benefit from operating in a country that has a stable political environment, is English speaking, and business friendly. In addition, the Welsh Government has a dedicated team that looks after investors in the country. Wales can also offer companies some of the highest funding and financial incentives in the UK, plus a range of other forms of business support. When you locate your business in Wales, we can contribute between 10 and 45 per cent of your capital expendi-ture and associated revenue costs on inward investment projects (subject to terms and conditions). Finance Wales, one of the UK’s largest regional invest-ment com panies, can also make commercial investments in small and medium-sized businesses (SMEs) based in Wales or willing to relocate. The business benefits should be clear. But the lifestyle and transport links to the UK and the rest of the world are equally impressive. Cardiff is the vibrant capital city of Wales – and one of the fastest growing cities in the UK. It is also just

30% 21-64 1.5M

More than 30 per cent of the Welsh population aged 21 to 64-years-old are college graduates. Add to that more than 1.5m graduates from all over the UK.

two hours on the train from London, which will be cut to one hour and 40 minutes from 2018. So, businesses can enjoy the benefits of being close to London without being burdened by the extra costs of being based there. For example, we offer competitive industrial property costs and prime office rental prices in Cardiff are up to 50 per cent lower than average London rates. Salaries are also more competitive in comparison to London and some other regions of the UK. Businesses in north and mid-Wales are similarly well served by their prox-imity to the large metropolitan areas and international airports of Birmingham, Liverpool and Manchester. Of course, other areas of the UK will have their own attractions. Areas of England may offer investors good access to decision makers at local authority level. But Wales is a nation, with its own government and a willingness to make things happen quickly. “We’ve never had a problem recruiting good people and we have good transport links,” concludes Andy Smith, MD of Freudenberg Oil and Gas Technologies. “Add to that the support shown by Welsh Government – they were all very significant factors in Freuden-berg investing in the business here.”

Prime office rental prices in Cardiff are around 50 per cent cheaper than average London rates

50%

Salaries are also lower, at about 70 per cent of London levels.

70%

2:00hrs (2016)

1:40hrs (2018)

Cardiff is just two hours on the train from London, which will be cut to one hour and 40 minutes from 2018

Yr Wyddfa/Snowdon is the highest peak in Wales and England. Wales also has three National Parks which cover 20 per cent of the country’s land mass and five areas of Outstanding Natural Beauty. In short, Wales really sorts out your work–life balance.

4 | Energy & Environment 5

Andy Smith paced the factory floor, which was abuzz with the sound of excited chit-chat and heavy machinery. It was the middle of 2010 and the managing director of Freudenberg Oil and Gas Technologies in Port Talbot had just been handed a prestigious contract. An explosion at BP’s Macondo Prospect meant that millions of barrels of oil were spilling into the Gulf of Mexico. The oil giant was struggling to stop and seal the spill. “We were called in as we had been working with a number of major oil companies supplying subsea connec-tors,” explains Smith. “They had to siphon off the oil into a pipe in order to clear the spill.” However, BP had a problem connect-ing the piping together. So the oil giant called up the Port Talbot-based compa-ny. Freudenberg Oil and Gas has 234 workers in Port Talbot, manufacturing specialist topside and subsea pipe connectors and sealing rings for the oil and gas industry. “They wanted eight connectors made in eight days,” says Smith. “We had engineers working around the clock. The connectors were absolutely vital because BP had all the other pieces of kit but had no way to

connect them together.” Freudenberg Oil and Gas – part of the German family-owned Freudenberg Group, which has 40,000 employees around the world – delivered the connectors on time. BP was impressed, telling the company that its product was one of the few that worked first time. The oil major then asked for a further eight connectors within eight days. Smith recalls: “It was absolutely fantastic – the efforts of both our subsea and manufac-turing teams here in Port Talbot were immense. It was fraught at the time. But I’m really proud of what we did here in Port Talbot. “It was really exciting, but we were determined that by hook or by crook we would do it. It was an absolute confirmation of how far we’d come.” Smith had confidence that the years of working on very technical products – bespoke items for inhospitable, deep-water projects – would stand it in good stead. He also had a strong team of engineers and skilled workers with years of experience. Smith joined the business in 1992, when it was known as Techlok, which had formed in Port Talbot in 1987.

F R E U D E N B E R G

Vector in January 2013. At that time, Smith told Ministers in Cardiff Bay that there was a possibility the new owners may shift the business elsewhere. He said the response from Welsh Government was key to soothing any concerns. “The Welsh Government was fantas-tic and helped us to find a bigger site in South Wales. We now have a long-term commitment to Port Talbot,” he says. “We’ve never had a problem recruiting good people and we have good transport links. Add to that the support shown by Welsh Government – they were all very significant factors in Freudenberg investing in the business here.” Smith is just as complimentary about living in the area and the benefits he has reaped from a better work–life balance. “I live in Swansea, so I love the Gower and occasional trips to Pem-brokeshire,” he says. “I used to live in Kent and work in London, so a three-hour commute each day was normal. Now, I can be home in 15 minutes, so I get a huge part of my day back. It’s a quantum leap in the work–life balance.”

Quality of production and reliability of service are key phrases that characterise the work of Freudenberg in Port Talbot, South Wales. The company provides seals for a variety of applications within the oil and gas industry, including offshore platforms and sub ocean installations.

PORT TALBOT, NEATH.

Techlok merged with Steel Products Offshore of Norway in 2003 to form Vector Technology Group. Freudenberg Oil and Gas bought Vector in 2013. “When I joined I wondered were we in the right location in Port Talbot?” Smith says. “But I found there was a huge pool of skilled labour here, as engineering businesses like 3M and Ford left the area and left behind this skilled labour force. So we started recruiting them.” He also realised pretty quickly that the costs of running a manufacturing operation were much lower than in Aberdeen, where a large chunk of Britain’s offshore oil and gas sector is based. Smith explains that trans-port links were another positive surprise. “A piece of equipment can come off the machine at 5pm in Port Talbot and be in Aberdeen before they start work,” he points out. The business has sales offices in all the major oil and gas locations, like Houston, Malaysia, Korea and Aberdeen. Port Talbot is the main centre for manufacturing and adminis-tration. Smith was convinced that Port Talbot was the right location, but he realised his superiors at Freudenberg may need some persuasion when the group completed its acquisition of

6 | Energy & Environment 7

‘We’re changing the way the world keep things cool’. If the catchline is intriguing, the technology and ambition of the Cardiff-based company illustrates the fresh thinking needed to provide sustainable solutions for the future.

The Deep Green project off the coast of Anglesey is a revolutionary underwater power plant. It reflects the ambition of Welsh Government to support industrial innovation and the aim to make Wales a global leader for sustainable energy.

Sure Chill’s breakthrough design isn’t just beautifully simple: it’s also life-changing across the world. Main-taining water at a constant temperature even without power, the proudly Welsh Tywyn-based group enables vaccines to be offered safely for up to ten days in areas of the world where cool storage would be critically unavailable, earning $1.5 million from the Gates Foundation towards the development of their vaccine cooler in 2014. Keith Bartlett, the Company’s Chief Executive Officer, says their skills set

S U R E C H I L L M I N E S T O

has benefited from the recruitment of bright new graduate talent under the GO Wales scheme, and believes their success will see Sure Chill become as pioneering in the refrigeration industry as Dyson has been to vacuum cleaners. “I am fully aware of the challenges faced by pioneering businesses,” he reflects. “I’m not sure there is such a thing as a magic ‘one size fits all’ strategy for success. What I can say is that we have such a strong belief in our product and our goal of improving medical refrigeration in the developing

world. We believe passionately in the fundamental human principle that every child has a right to life, and just as passionately in the potential of the Sure Chill technology.” Wales backs that prospect. “I have developed a close working relationship with the government in Wales,” says Bartlett. “They have been very helpful in understanding and supporting what we are trying to achieve so that we can forge ahead with our development programme and step ever closer to realising our vision.”

Burgeoning Swedish company Minesto develops a unique technology for producing electricity from tidal and ocean currents. Ten years in, CEO Dr Martin Edlund says the company is getting ready to build and install their first tidal energy array – starting with Holyhead Deep in North Wales. “We looked at different parts of the UK where we thought would be the first place to build up a larger organisation. The welcome that we have received here has been quite tremendous. The amount of infrastructure available here in Holyhead was an important part of the decision. We met a number of different governmental bodies and they’ve all been extremely supportive about the sector and very curious about how they can support us.

“The combination of different gov-ernmental organisations all being on the same line and vision has been very obvious. It’s been a clear path that fitted well into what we are trying to do. “Seventy per cent of our globe is covered with oceans, so obviously if we can utilise all the moving currents around the world, that’s going to make a big change. Our collaborations have expanded into working with Swansea University on mammal investigations and things like that. Those type of collaborations are going to be really important for Minesto and other inves-tors coming here. “They’re quite unique in the way that they can actually support businesses in what we really want and need. It’s a big difference compared to, for example,

Swedish universities. It’s very high quality but also very supportive to developing businesses. “The governmental support was important. So was the tidal resource along the coast of Wales. The fact that all the organisations have been very open-minded and have welcomed us with open arms has helped us tremen-dously and made us feel at home. It’s been a really, really good experience and something that we value very highly. “If I was a company I would get in contact with the Welsh Government to ask the questions because I think there is a really golden opportunity at this moment to come to Wales and establish your business. It’s very exciting.”

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Not many car designs set out to change the world. From Powys to the planet, start-up company Riversimple has spent 15 years developing the technology and business strategies that have led to its carbon-fibre Rasa vehicle. And Founder Hugo Spowers has a track record in good-looking motors. “I used to build racing cars – I loved it, but I got out for environmental reasons. We need to move on from combustion engines. I started looking at all the options – I didn’t even know about hydrogen fuel cells, initially, but when I did I realised that we needed to build and sell a car in a different way. We sell mobility as a service, much like a mobile phone. You pay a monthly direct debit and that covers all your costs – and when I say all, I really mean it, including for example insurance and fuel. “Coming to Wales has been much better than we ever expected. We didn’t realise just what advantages it would have. We get a lot of support from the Welsh Automotive Forum. It’s fantastic for us, being able to leapfrog and establish cross-sectoral collaborations.

R I V E R S I M P L E

Wales has a longstanding tradition of innovation in the automotive industry. The Rasa is the latest and arguably most radical – a hydrogen fuel cell car that forms part of Riversimple’s ambition to eliminate the environmental impact of personal transport.

We’ve also got a fantastic relationship with the Welsh Government and they really have been extremely supportive. This is a much better environment than if we’d stayed across the border; for what we’re doing, it’s easier to do it here in Wales. “The car’s name comes from Tabula Rasa, a clean slate, not just because we are building a different kind of car but also a different kind of business. We’ve got an entirely new business model to suit the 21st century. The scale of Wales, the attitude and the opportunity to create relationships more quickly here has made it a lot easier for us to progress. When we speak to people in the government, right up to the minister who came to see us a few weeks ago, that attitude is very obvious. Everybody comes to the conversation on the basis of, ‘what can we do to help?’ “We are doing many things in different ways, to suit the new technol-ogy and to turn the constraints of sustainability into a source of competi-tive advantage, but there doesn’t seem to be anything that we want to do that

they want to brush under the carpet. It is a very genuine, collaborative relationship and they are very creative about making suggestions on helping with the barriers that we face. There is a mandate in government to support the sort of things we’re doing and a receptive attitude to us. “The skills you need to make a step change are all about systems integra-tion. We are facing a step change, not only in the automotive sector; in the whole green growth transition, the same thing applies. In such circum-stances, agility and cross-sectoral collaboration are more important than scale and I really think there are opportunities now for Wales to punch above its weight. There is no doubt in my mind at all that in Wales we’ve achieved a much greater and wider network of relationships much more quickly than we would have been able to elsewhere. “I wouldn’t hesitate to tell anyone to come to Wales – I wish we’d have come here a bit earlier, quite frankly.”

LLANDRINDOD WELLS, POWYS.

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We get things moving in Wales. As you’ll see for yourself, just as soon as you get in touch. Straight away we’ll team you up with a dedicated Business Development professional.

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What next?Find out what Wales can do for your business:

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