WHILE oil and gas giants are raking in huge sums on the back of strong oil prices, many small and medium-sized firms are putting their eggs in the renewable energy basket.
This week’s SME Focus highlights one of the Scottish firms that have been benefiting from the growing interest of farmers and the like in producing their own power. But the experience of the company’s owners provides a reminder that all entrepreneurs need to expect the unexpected.
Names: Jim Paterson and Stephen Hamilton
Ages: 31 and 40 respectively.
What is the business called?
The new name is VG Energy (formerly known as Ventus Green Energy), explains Jim Paterson.
What services does it offer?
VG Energy was set up to offer everything from planning consent to installation of wind turbine and solar solutions to farmers, landowners and householders. The staff offer advice on wind turbines from 15kw to 500kw in size, which can power anything from farms to factories and also feed back into the national grid.
We have also just launched a solar division, which is expanding into different technologies and materials, offering renewable power to clients with suitable roofs or ground space. We also are on the look-out for good sites for our own turbines, that gives the landowner or institution a rental income from the turbine output.
The planning team is rapidly expanding with a mix of surveyors and experienced architects. This gives us the strength to manage planning applications all over the UK and line surveys for the likes of ScottishPower or Southern Energy.
We are well known in the agricultural sector, especially Scotland where we have the majority of our clients.
What is the turnover?
Our turnover to 2010 was £5m and we are predicted to do £20m in this financial year.
When was it formed?
We were formed in October 2008 and started the business from a wing of Stephen’s farmhouse above Newmilns with four staff. Now we have 40 people in modern, rural offices just outside Galston, Ayrshire.
What were you doing before you took the plunge?
I was a farmer and agricultural contractor with a plant hire business and Stephen was a property developer, although he was originally from a farming family in Northern Ireland. We had always been self- employed, and discovered that we were both looking for a new opportunity. Around the time we met, farming as an industry was declining, and the same was true of the property market, in which Stephen was involved, so we had a lot in common.
Why did you take the plunge?
I’d just moved house and popped in to introduce myself. When I arrived, Stephen was meeting with a wind turbine salesman because he was considering buying one. I stayed and sat in on the meeting, and when the salesman left, we chatted on for another four hours, and believed that we could do a better job than the salesman, so decided to combine our resources and start our own company. We saw, and still see, renewable energy as an exciting long-term business.
What was your biggest break?
We had been building up our potential client list for four months, but despite research across the globe hadn’t found a wind turbine company whose products suited the wild Scottish climate.
It was almost by chance that we discovered that there was a company, located 10 miles away, (Proven) who had been manufacturing wind turbines for 27 years. We set up a meeting, and secured the rights to sell his product over the whole of Scotland. In addition, Alex Salmond announced the Scottish Government’s ambitions of achieving 80% of electricity from renewables and we grew from there.
What was your worst moment?
We had spent the best part of two years building Ventus Green Energy’s name and reputation within the agricultural community, and had just launched a solar division aimed at the consumer market when, in November 2010, we were threatened with legal action by a financial, London-based company, who claimed we were trading on their name. There was a real possibility that they would take us to court if we didn’t change the company name.
We considered fighting them however we recognised that we could have been in legal limbo for years, so we decided to re-name the company. It is still taking up large amounts of our time and money – letting clients know what has happened and are changing company literature, email addresses, signage, websites etc.
What do you most enjoy about running the business?
Truly, we get the biggest kick out of selling what we believe are great products to our clients, and in the process making our customers, and ourselves, money.
Also, being able to bring jobs to an area which has been badly hit by company closures and redundancies is also good, but also a little frightening because we realise that almost 40 people are now relying on us every month, to pay their wages.
What do you least enjoy?
Dealing with ever-changing planning rules.
We need a consistent planning policy for mid-sized wind turbines (up to 50m tall.) These turbines are new in the Scottish landscape.
Planners can sometimes be understandably nervous about the impact these will have on the landscape, but compared to the other massive ones, eg Whitelee Windfarm (in East Renfrewshire), ours simply look like telegraph poles.
The crazy, expensive, bureaucracy and Government rules need to be trimmed if we are going to reach our renewable target by 2020.
What are your ambitions for the firm?
To become the leading renewable energy provider in the UK.
What are your top priorities?
Good customer service, honest output predictions, company growth, happy staff and even happier customers.
What could the Scottish/Westminster Governments do that would most help?
All the above, plus ensure our customers receive reasonable quotes to connect to the electricity grid. The National Grid should be just that, national, for the people as well as the multi-nationals.
How do you relax?
Stephen and I have young families and busy wives with whom we love to spend time.
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