Recycling Technologies was formed in 2011 as a spin out from the University of Warwick. Now, with the help of Birmingham University, it is forging ahead with a combined heat and power plant fuelled by mixed plastic waste (MPW).
Bringing such novel concepts to fruition involves risk that is not always easy to finance. The company is therefore delighted to have recently overcome this very significant hurdle on the road to building its first machine, the WarwickFBR.
Recovering the energy from MPW is not a new concept, but the plant for doing this is typically large scale and expensive. Due to its scale, getting material to such a plant can require undesirable trucking. Plus, distributing the large quantities of waste heat produced is sometimes problematic.
The Recycling Technologies plant will enable MPW to be consumed on much smaller sites with 1 ton per hour of MPW producing up to 3MWe output and a similar quantity of thermal energy.
The return on the much smaller investment makes the plant financially attractive, and the reduced transport and improved waste heat recovery options provide environmental benefits, too.
But turning such a concept into a commercial success requires considerable technological perseverance from a motivated, multi-disciplined team, which requires a significant level of funding. Discovering the requirements of different types of investors and gearing the proposition to the right type was critical.
Established venture capital firms like to invest significant sums of money where the technology has been largely proven; we neither needed such levels of funding nor could show the risk profile they desired.
The Government’s grant schemes are good, but it is difficult to build a business plan on the assumption that an application will be successful.
We found that the business angel community (see box), buoyed by the excellent Enterprise Initiative Scheme, did a good job in filling this gap.
The benefit of the business angels is they not only provide cash but also the advice and experience that can make the difference between success and failure.
While they understand the potential rewards of investing in novel technology, they also understand that the associated risk must be mitigated.
So we decided to approach the Wroxall Investor Group, a syndicate of business angels. But first we needed to make sure we could demonstrate that there was a market for our product, and that the team were up to the technological and financial tasks ahead.
These twin issues were solved when Peter Jones OBE, one of the UK’s leading waste management experts, joined the team as an advisor, and a forward thinking customer placed our first order.
Credibility with the business angel community was further helped when David Ashcroft and Martin Lusby, both members at WIG, joined the team.
With the backing of WIG, we can now expand the team to accelerate the journey to installing the first WarwickFBR and also put in place the infrastructure we need to attract other potential customers.
With 2,500,000 tonnes of MPW heading to landfill each year in the UK alone - enough energy to supply the domestic electricity demand of Wales - we hope that the financial return that the plant can provide will result in many of them being installed and making a really positive environmental impact.
Adrian Griffiths, managing director of Recycling Technologies
What is a business angel?
Business angels are wealthy entrepreneurs who provide capital in return for a proportion of a company’s equity. They take a risk in the hope of owning part of a successful business. Business angels often join together to pool resources and knowledge.