Diversify into Green Energy they say, “pivot”, but those who have successfully achieved this know it takes time and the path is fraught with danger… with the devil being in the detail.
We began our renewables journey in wind in the Middle East with a very substantial order for an inert gas system for a rectifier station destined for the South East Coast of England. We found this new sector welcomed innovation, and our approach to providing a central bank inert gas system, instead of traditional individual gas systems, pleased the client greatly as it resulted in significant cost savings.
This was closely followed by another wind project, this time being constructed in Scotland for a Danish customer providing fire alarm systems (FAS) and fire extinguishing systems (FES), this one was destined for the Yorkshire Coast. This project saw Blaze delivering its expertise to the Forth Estuary and eventually into the Aalborg Ship Yard. This is when we learnt all about the importance of contracts and how large they can be. At the same time, we had landed a very large project for the German State Energy Provider for the FAS and FES systems we had become known for, but this time with the full Scada interface.
As we moved through these projects we honed our expertise. Although we took our innovations from oil and gas, the renewables market posed a significant change in the fire extinguishing and control systems we deliver. Unlike oil and gas, in the renewables market we are fundamentally protecting Capex, as there is no hydrocarbon process plant and so the risk of escalation is greatly diminished. By utilising Very Early Smoke Detection Systems we can detect the incipient stages and we can even circuits beginning to overheat, thereby providing maximum protection to the plant.
Our latest partnership is with a Dutch contractor for an installation that will be built in Indonesia before being deployed on the East Coast of England. We have spent three years learning lessons and spending significant time at the contract negotiation stage. It is difficult to survive in this sector as an SME due to the onerous commercial terms, but we have a strong team and, dare we say it, we are beginning to thrive once more. Recognising this need for change in how we execute these large scale contracts was a driver to seeking investment from a large company with the same values, this means our success is not constrained and the ambitious growth funds are matched with a strong balance sheet and operating portfolio.
Having gained a vast wealth of knowledge we currently have over a dozen active projects in the offshore wind sector and we are working with multiple customers and future projects that amount to over £10 million turnover in the foreseeable future, thus offshore wind is a significant market sector in Blaze’s operation.
In the early days, this sector meant we had to retrain our workforce as we were set up for oil and gas and the core competencies are not transferable.
No business that pivots and successfully diversifies is without its challenges. Whilst the oil and gas sector relies heavily on Logic terms and conditions, the renewables sector is more litigious and contractual. The early days may have seen us tied up in knots, but after changing the way we manage projects to deliver successful outcomes our growing team is now set up for success.
So anytime someone comes up with the genius idea to “pivot” into another sector, learn from those who have been through it and are out the other side. The renewable energy market is a fascinating sector with many interesting challenges, just tread carefully along the path.