Tim Rook, the new Chief Markets Officer at Clade Engineering describes why the company has chosen to make a strategic move into the heat pump market.
As the leading provider of low carbon refrigeration systems in the UK, Clade feels ideally positioned to take a prominent role in the UK’s developing heat pump supply chain.
With  years of experience and expertise in the refrigeration sector, Clade feels well placed to support the Energy Transition that will move our economy from being fossil fuel-based to zero-carbon by the second half of this century. As well as launching a range of heat pumps, Clade is supporting its existing customers to become even more efficient through the development of products which complement refrigeration systems to achieve even greater carbon emission reductions namely; high temperature heat pumps for industrial processes and a data platform that leverages artificial intelligence to optimise system operations.
All business leaders face a triple whammy from climate change;
- Shareholder value and financial impact
- Reduced sales revenue
- Increased risk
Over recent years, the world has seen a major shift in attitude to climate change, one of most powerful effects is the changing allocation of capital by financial institutions.
Larry Fink, CEO of Blackrock says
“We know that climate risk is investment risk. But we also believe the climate transition presents a historic investment opportunity. From January through November 2020, investors in mutual funds and ETFs invested $288 billion globally in sustainable assets”.
Greener assets and greener businesses will attract a shareholder premium and will have a lower cost of capital.
As the public, procurement teams and even the Bank of England increasingly give preference to businesses with high ESG (Environmental Social Governance) ratings, any business that fails to address these issues will see its sales revenue reduce and their competition move ahead.
Business risk is increasing
From the physical effects of climate change such as flooding and drought, being unable to attract talent, unusable islanded assets and the risk from changing regulations. Governments are increasing pressure through both regulation and incentives. The UK hosts COP26 this year and we can expect to see more national commitments to net zero. It will become more expensive to operate inefficient and high carbon processes at any scale.
Business leaders are now expected to publicly demonstrate progress towards a sustainable future through frameworks such as TCFD and SASB. If they don’t independent organisations like MSCI who will; there are will be nowhere to hide.
Fortunately, in the UK, power generation has been, and continues to be, decarbonised by solar and wind power but the transition in thermal energy has barely started. Electrification of heat is the only scalable, viable solution that is ready to go right now and the most efficient electrical heat technology is heat pumps.
Combustion technology being left behind
Heat is already 40% of our carbon emissions and it is set to increase as we experience more volatile weather which leads to an increased use of heating and cooling. Combustion technology for heat is being left behind because it is far less efficient and offers far less flexibility. Heat pumps, being driven by electricity can partake in the energy markets with dynamic pricing, can be linked to electric vehicles and on-site generation and cooling / refrigeration. Additionally, heat pumps improve local air quality as there are no products of combustion. Heat pumps, such as Clade’s; that use CO2 as the working fluid, offer the lowest GWP and work at temperatures suitable for traditional systems. They are a key element in the Smart Cities of the future; every heat roadmap or policy paper supports the widespread use of heat pumps that use green power.
Decarbonising heat using heat pumps is a proven way for businesses to demonstrate a commitment to sustainability, to reduce cost and risk which will positively impact the bottom line and shareholder value in many different ways.
The transition to the use of heat pumps utilising natural refrigerants will most certainly follow the path already taken by the refrigeration industry; where chemical refrigerants are rapidly being assigned to history. This would result in the early replacement of non-natural plant or the islanding of the assets, a risk that businesses need not take.
A greener future demands bold steps today, Clade Engineering is making these bold steps to help its customers decarbonise their heating demands.
Tim has 13 years of experience in technology and business leadership in low carbon energy and climate change. He has built and led high performance teams who have developed and deployed technology in solar, biomass, heat pumps and combined heat and power. Additionally, Tim has worked to deliver industry standards that help define the sector as well as representing the industry voice at Government and EU levels. Recently Tim has been working with cutting edge AI and blockchain technologies to quantify climate risk, transform industrial processes and drive business performance. Outside of the corporate world Tim is an environmental entrepreneur, investing in an under-planted agriculture project as a biodiversity and social venture. Joining Clade as the CMO Tim will bring experience and passion for climate positive business and engineering as the company moves into an exciting new era.