The Big Interview: Dan Wright, founder of steam power spin-out Heliex

Dan Wright at Heliex in East Kilbride,
which is now making clean energy solutions for clients around the world. Photograph: John Devlin — Dan Wright at Heliex in East Kilbride, which is now making clean energy solutions for clients around the world. Photograph: John Devlin

Far more forward-looking, however, is his role heading a company that efficiently converts relatively low-temperature steam into energy, exploiting the extensive engineering knowledge that secured him an MBE.

Wright is the founder and chief technology officer of Heliex, which has developed a way to harness energy from so-called “wet steam”, the type of vapour you can see when a kettle boils, traditionally lost as waste heat in industrial processes.

Heliex says it is generating energy “even in conditions where it was previously thought impossible” as this type of steam’s moisture content can cause irreversible damage to turbines.

In fact, the “conundrum” had vexed industry for many years. “When we show engineers what we’ve achieved they say: ‘At last! Someone’s finally done it’.”

Heliex was established as a spin-out from City University London, which had originated a motor known as an expander from screw compressor technology, which is used for compressing gas.

Glasgow-born Wright explains that if a screw compressor’s functionality is reversed, it can be used “as a means of recovering energy that would otherwise go to waste” from high pressure gas or steam.

The university in 2009 received an inquiry from a company that was building a geothermal power plant using hot steam coming out of the ground to generate power and, sensing commercial potential in this, suggested to its engineering faculty that a spin-out company could be formed.

Wright’s name came up, given that he’d had a long-standing association with the university, partly as a visiting professor.

“They said, ‘We know nothing about forming a company – could you do it?’ At that time I was at a point where I was wanting to get back into having my own company again… so the time was right for me to look at this.”

Regarding the technology used to springboard Heliex, Wright says: “The economics of energy were beginning to become significant, so it was a subject whose time had come.”

He explains that steam can vary from low-quality energy that goes up to the boiling point of water to the “superheat regime” where temperatures can hit 1,000 degrees Centigrade.

“There’s a huge chunk in the middle of medium-quality energy where no-one had come up with a machine, an actual physical manifestation of a machine, that can extract that energy and not be damaged by the way in which you do it.

“And that’s what we’ve found. It’s a huge, huge field of energy recovery and energy manipulation.”

Heliex says more than 40,000 gigawatt hours of energy are lost globally every year through waste steam, and it’s thought that up to 50 per cent of industrial energy usage is eventually released as waste heat, enough to power 28 billion homes.

Wright says: “When I was developing the business plan, every time I looked at the size of the market it was so big for what’s a new strategic technology. It didn’t have any credibility, but every time I did the numbers it came out in a market of billions.”

The firm early on attracted the attentions of BP, which commissioned a study that found that if the waste heat market in the US could be reached, Heliex could generate more power than the world’s capacity of installed wind turbines. BP’s alternative energy investment division approached him, “and said, ‘We like what you’re doing — would you be interested in having us as an investor?’” Wright recalls.

Joking that he replied “Och no, lads, you’re far too small – away you go”, he asked how much they would like to contribute.

In December 2010, BP put its first money in, at which point “we actually created Heliex in the little office in East Kilbride” and then started developing the product from theoretical calculations.

Funding also came from another party, stemming from an early meeting with BP, when one executive said he was leaving the oil major to join the investment division of what would become Greencoat Capital, which invests in the clean energy and energy-efficiency sectors.

“He said, ‘One day you’re going to need more money – would you mind if I took your file along with me because I think we would be interested in this.’ And sure enough, about a year or so later, BP invested again and so did Greencoat Capital. To March 2016, we have had Greencoat and BP as equal investors.”

Heliex has this year raised a further £4.2 million from Greencoat, BP and the Scottish Investment Bank, taking total investment to £16.2m to date. The company shipped 30 products last year, and is in Austria, Switzerland, Italy, India, France, Poland and Ireland. It has six products up and running in England and several in Scotland, with sites including the Royal Alexandra Hospital in Paisley, a couple in whisky distilleries and more to follow.

It is set to ship 40 products this year. “We’re now starting in negotiations with some major energy-producers and plant-runners. Some of the biggest names in the world are starting to take our kit.”

Furthermore, Heliex has a potential joint-venture partner in China, which carried out a study finding that the country needs about a million of its machines.

“That just shows that this is actually a strategic thing we’re doing. This whole business of energy efficiency and energy recovery — making better use of what is there already rather than generating more of the stuff by other means like wind or so on — that’s really what this is all about.”

And while the likes of China and the US offer strong potential, he sees the European market as the “most sophisticated”, adding: “It’s the one where people are most aware of the need for energy recovery, and it’s the area which has the most expensive energy for reasons of government policy.”

He also foresees no significant impact on the business from the Brexit vote, saying: “We’ll trade in Europe, we trade in Europe already. A market’s a market.”

Wright’s current roles also include chairman of Borders motorsport event, the Jim Clark Memorial Rally, and he describes himself as “still a complete petrolhead”.

He notes that his Aston Martin DB7 has a supercharged engine, “and I was heavily involved in supercharger technology”. Wright in fact studied aerospace engineering at the University of Glasgow, with two years’ postgraduate research into ground-vehicle aerodynamics.

As for what prompted him to initially choose engineering, he says: “I’d always been interested in cars and I’ve always been taking things apart and putting things together, wanting to know how things work.

“I’ve found that with engineers,” he adds, believing that it’s in the DNA. “It’s almost like an affliction. It’s in there all the time.”

A chartered engineer by trade, he started working as a consultant in aerodynamics for various Formula 1 and racing car designers.

This was followed by joining the Ford Motor Company in truck operations, where he received “the best training in the world, not just in engineering, but in business”.

He subsequently joined the Howden Group, setting up its compressor business in South Africa, but the lure to return to the automotive industry saw him take up a role at British Leyland.

He later co-founded Fleming Thermodynamics, developing engine technology. That business was then sold.

“By that time I was the Prime Minister’s deregulation adviser and I was asked by the government to look at rescuing all the bits of the Leyland DAF truck group, which nobody else wanted.”

He says his intervention in the early 1990s, when the group was hit by bankruptcy, saw him rescue the likes of the Albion Plant in Glasgow and save about 450 jobs.

“After that people started asking me to help them sort out their companies… and then I kept on doing chairmanships and hands-on work in a whole variety of industries until [the Heliex] opportunity came up, and I then stopped everything else to do this.”

The company now has 30 staff and its turnover has this year exceeded £3m, up from £900,000 in the previous 12 months. It now aims to grow turnover to up to £7m next year, and then £13m.

Despite its patented technology, are there concerns about new players coming in due to the potential size of the market?

“For absolutely certain, the market is so attractive there will be competitors. The way that you deal with that is by keeping up your research and development spending, and making sure that your products are more desired by customers than your competitors’.”

In fact, he flags up plans for “major expansion” of Heliex’s technology. “We already have two completely new product lines that we’re working on in energy efficiency. The way a company like ours stays ahead and makes itself attractive is by continually producing new products, which are economically desirable and, in our current world, energy-efficiency desirable.”