Interview: Derek Shepherd - Carrying a torch for new generation of wind power

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AS SOUVENIRS go, an Olympic torch isn't a bad memento to hang on your wall. For Derek Shepherd - former managing director of the international division of temporary power supplier Aggreko - the sceptre brings back memories of the 2008 Beijing Olympics, which he oversaw for the Glasgow-based company.

But the torch isn't Shepherd's only keepsake from China.

"When I retired in April 2009, Aggreko gave me an antique Chinese snuff jar," he explains. "I collect these tiny jars and the mark of a really great one is how well the artist has painted the inside of the jar using a paint brush with a single bristle."

Shepherd then demonstrates how the artists lie on their backs and hold the tiny jars up to the light in order to paint ornate patterns within the vessels.

It's just one of a thousand tales the engineer has picked up from his travel around the globe, first for construction company Taylor Woodrow and latterly for Aggreko.

Now Shepherd is bringing the lessons he learned in international business to bear on NGenTec, one of Edinburgh University's most high-profile spin-out companies.

NGenTec - or "novel generator technology" - has designed a generator system for wind turbines that it claims is up to 50 per cent lighter than its competitors. The invention uses a "direct-drive" system of electromagnets instead of a series of gears to turn the wind energy into electricity and Shepherd believes the fact that it is built in modules makes it easier to manufacture.

"That's going to become very important as people start building more offshore wind turbines," he says. "You don't want to spend a lot of time going out to maintain and service your turbines because of the costs involved in hiring barges and waiting for weather windows."

He says NGenTec's system can still run at 80 per cent efficiency even when one of its modules has been taken out for servicing.

"That's one of the lessons I learned from Aggreko," Shepherd smiles. "Even though Aggreko may have 150 generators supplying power to, say, Nairobi in Kenya, two or three of them with always be down for repair or maintenance so you need to have redundancy in the system so that it can still deliver 100 mega-watts (MW) of power."

Shepherd joined Aggreko in 1989, having previously travelled the world with Taylor Woodrow.His time with the construction firm saw him working on projects including Liverpool's Roman Catholic cathedral and Birmingham's Aston expressway, which flows into "spaghetti junction", before he moved to Nigeria and ended up running the company's operations in the African country during the 1970s and 1980s oil boom.

After a spell in the UK with Aggreko - which, at the time, was led by Chris Masters and was still part of the Christian Salvesen logistics group - Shepherd moved to the Middle East and opened the company's office in Dubai in 1991, providing generators to the coalition forces during the Gulf War and its aftermath.

The international division he founded now accounts for about 60 per cent of Aggreko's profits but it's the people involved in the business that Shepherd remembers the most.

"I started the division from my house in Dubai, with my secretary working out of the spare room," he remembers. "It only took one day to incorporate the company and I even went and set up the post box number myself."

While in Dubai, he also struck up a friendship with Sir Maurice Flanagan, founder and now executive vice-chairman of the Emirates airline group.

"Dubai was a great place to do business because you could access markets in the Middle East and across into Pakistan," says Shepherd. "Whenever I had dinner with Maurice, I wasn't sure if he was picking my brains to start up new routes where Aggreko was going or if I was picking his to see where his next flights would be."

Now Shepherd is putting his skills to use with NGenTec as he aims to take the company through the process of building a full-scale working model of its generator and into production. He found out about the company through the Global Scott networking and came on board in 2009 as its chairman.

"At Aggreko and Taylor Woodrow, I influenced the top people to spend money in growth areas," he explains. "I convinced chairman Frank Taylor to invest in Nigeria to make the most of the oil boom."

Those influencing skills will come into their own as Shepherd convinces turbine makers to adopt his company's technology for their generators but they are already paying dividends.

Earlier this month, David Brown - the gears business owned by Jim McColl's Clyde Blowers empire - signed a "multi-million pound" partnership deal with NGenTec, under which it will help the firm to build its prototype in return for an equity stake.

David Brown will also take a seat on the Edinburgh-based company's board, indicating the stake it has taken is more than 10 per cent. Having overseen Aggreko's assembly plant in Dumbarton, Shepherd knows the importance of getting the manufacturing process right.While he praises David Brown - and funding from Scottish Enterprise and the UK government's Department of Energy and Climate Change - Shepherd criticises Scottish and British venture capitalists for not pumping more funding into start-up companies in the clean technology sector.

NGenTec found its VC funding from Dutch outfit SET Venture Partners and Shepherd will next month head to Monaco to wrangle more cash from clean tech investors and bankers.

"If Scottish and British VCs want to see companies staying in the UK then they have to put their money where their mouths are," Shepherd says. "We really want to keep our company in Scotland."

Shepherd invested 20,000 of his own money in NGenTec to help get the company started and he hasn't ruled out a stock market floatation in five or six years' time to allow VC investors and the founders to see some return on their investments.

"But it's not really about the money," Shepherd adds. "I want to be able to look back on my retirement and know that I helped create something great. David Yorke and Gordon Tourlamain had that feeling after taking Aggreko from Holland to the UK in 1973 and I want to share in that feeling."

BACKGROUND

Born in 1942 - and sharing a birthday with Glaswegian comedian Billy Connolly - Derek Shepherd attended Dundee High School and then studied engineering at the city's technical college, which became Abertay University.

He worked with construction outfit Taylor Woodrow in the UK and Nigeria and later spent 22 years at temporary power supplier Aggreko, launching its international division.

As he approached retirement, Shepherd found out about NGenTec through the Global Scot network and signed up as its chairman to help inventors Markus Mueller and Alasdair McDonald commercialise their technology.

Shepherd is married with four children.