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PowerPoint Presentation - Cleantech Forum Lahti 2006


									Expanding horizontally
   in energy business

    CleanTech Forum, Lahti

             Matti Malkamäki
      Managing Director, M.Sc.
          Greenvironment Oy
   General
   Vision & Strategy
   Technical product

Traditional sales
   Pro’s and cons
   Cash Flow Influence

New market sales
   Focus market; Germany
   Concept
   Cash Flow influence
   Status Quo

What next?
Company in brief
Core business
   Producing electricity from biogas
           Special concept for Germany
   Biogas power plants
           LFG and digester gas

Full-term R&D on bio-energy since 1997
   Product development partly financed by
     TEKES –National Technology Agency of Finland
                                                                  StoraEnso, Imatra Mills biogas plant
Entry to market in 2003
   Turnover 2003 to FY 2005 approx 250 k€ / year
   FY 2006 (05/2005 to 04/2006) approx 0.9 M€
   Thirteen own employees, networking heavily with partners on
    R&D, manufacturing and sales
   Strong partnership with Capstone Corp., USA

   Founders
                                                                                       Biodiesel samples
   VC Investors Seedcap Ky (Innofinance Oy), Finnish
    Industry Investment Ltd, MidInvest PH I FundKy, Venture Invest I Ky

Greenvironment is the Europe’s leading technology and energy provider in distributed,
                           small-scale biogas solutions.


 We focus ourselves to produce electricity from biogas utilizing our own technology.

We have developed certain concept for this “biogas purchasing – electricity producing”
             scheme called “fuelVALUE” (“brennWERT” in German).
Removable skid-based biogas power plants
Traditional sales
We’re a enabling technology company
providing solutions to convert biogas to energy
Areas of technology,                                                                  Special
legislation, etc.                                                                    Customers

                                                                                 Finnish Air Forces /
  Microturbines,                                                                     Hesburger
 biogas utilization

      Flares                                                                         Asiakas 11
                                                                                      Asiakas 1
                                                            Sarlin-Hydor                    ä1
                                                                                           Group 1
     biodiesel              Greenvironment
                                                                                     Asiakas 11
                                                                                      Asiakas 1
 Environmental                                             NHK Keskus                  Asiakas
   legislation                                                                              ä1
                                                                                           Group 2

  EC directives              Own products                    Enitial Ltd
                                                                                     Asiakas 11
                             - LFG / DG (flares)                                      Asiakas 1
                       - GDA (biogas pretreatment)                                          ä1
 Trade of energy,          - Energy (whole plant)          Others / new                    Group 3
Trade of emissions       - Esterification (biodiesel)

                                                        Total 8 sales partners
 Product Safety
     Direct sales
          Sales partners
                                                                   Scandinavia, Germany, Preseco Oy

                                                                     Scandinavia, Baltic countries, UK, NHK Keskus

                                              UK, Enitial Ltd         Finland, Sarlin-Hydor Oy     Baltic countries, RMG ee

                                                                      Poland, Milkamo Sp. z o.o.
                                    Germany, Greenvironment GmbH
                                                                         Hungary, Montivo Kft.
                                    UK,Belgium, Germany, LeLy

Global, Capstone Corporation
- sales through Capstone’s global                                                                           Japan, Cornes AG
  distribution network

Existing partner

Partnership under negotiations
Pro’s and cons of direct sales
from our point of view
   Traditional way of doing business
         Customers are used to it and know “how to behave”
         Investors, finance providers know this, too

   May - and most probably will - cause delays in your cash flow
   You have to fight your position in the market EVERY day
         One won case won’t deliver cash flow after its finished
   There’s always someone to copy your product - will you have sales on a following day
   Is the feedback from your customer TRULY the answer for future needs?
Cash flow issues
    - this is what you seek for...
Cash flow issues
    - but what if this is what you get?
New market - Germany

    Why and how to change
          your business from
   vertical sales to horizontal
  Focus to the market
  Biogas plants in Germany

Now approx 5200 plants, estimated to be 30.000 by 2015
Electricity from Biogas in Germany - forecast
Biogas forecast set by the Fachverband Biogas in 2004, often referred as the “Essener
                                                     End of 2005: 880 MW

                                2005          2010                    2020

    Installed power             430 MW        2.277 MW                10.000 MW

    Electricity output          2,8 TWh/a     12,3 TWh/a              76 TWh/a

    % of total electricity      0,5 %         2,7 %                   17 %

    Turnover from electricity   360 Mio EUR   1.800 Mio EUR           11.100 Mio EUR
    sales (biogas)
The agricultural structure in Germany
                             A: The EAST
                             Mecklenburg-Vorpommern, Thüringen, Sachsen,
                             Sachsen-Anhalt, Brandenburg

                             (Total number of farms group A: 13.369)

                             B: The MIDDLE and NORTH

            B                Schleswig Holstein, Niedersachsen, Hessen,
                             Nordrhein Westfalen, Saarland

                             (Total number of farms group B: 78.884)

                  A          C: The SOUTH
                             Bayern, Baden Württemberg, Rheinland Pfalz

                             (Total number of farms group C: 83.604)

The Greenvironment Energy Concept
brennWERT (“fuelVALUE”)

                                   Gas         Power Plant
      Reactor 1   Reactor 2
                              Pre-treatment      (CHP)

  Farmer produces                     Greenvironment
 biogas and sells it                produces electricity
 to Greenvironment                 and sells it to the grid
Income Logical for a biogas plant (yearly basis)
Case Remlingen
Size of plant: 557 kW
Contractual period: 20 years

Total turnover (energy sales):    819.860 EUR
Raw material (biogas purchase):   -520.514 EUR
Service cost:                      -34.291 EUR
Financing cost:                    -84.528 EUR
Insurance cost:                     -2.300 EUR

EBT:                              178.228 EUR
Twofold strategy for the German market
The brennWERT (fuelVALUE) concept targets two different groups of customers:

               THE FARMER                         THE BIOENERGY-VILLAGE

        Acreage: 75 - 200 ha                     Heat usage is the driving factor,
        Small interest to run a CHP on            ideally by local government
         his own - eliminate risks on              itself (schools, administration
         technical malfunction                     buildings, swimming pools)
        Heat usage on the farm and/or            Existing biogas plant in the area
         heat sale to 3rd parties                 Reduction of heating costs and
        Low investments, low costs, low           decrease the dependence on
         risks                                     the international energy market
                                                  PR effect
Cash flow issues
    - more secured against delays
Status Quo Sales
First customer contacts: Start in November 2005

100% owned subsidiary, Greenvironment GmbH, established late January 2006

Total number of customer visits up to date: 56

Number of prospects in the pipeline: 19

Number of potential deals: 12

Number of hot deals: 6 (Werlte, Mailach, Amelunxen, 3* rental in Baijer, Brücklmayr)

Number of closed deals: 1 (520 kW / 7 CR65 / Biogasplant Remlingen)
What’s next?
Focus, focus, focus...
Get the first projects to goal
   Technical aspects, manufacturing, logistics, etc.
         Create only structures that can deliver capacity for growth!
   Start the operations
         Power plant controls, condition monitoring, invoicing, etc.

Solve personnel points
   Get local staff - good one

Don’t forget to sell properly same time
   Clear structure - to which customers, what products?
   The “ketchup bottle - phenomena“ will happen - but can it be managed?

...and finally:
   Get the financing for growth

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