Commercialisation of Sharp’s Hybrid Renewable Heating Solution

Client

Sharp (SLE – European Research Labs)

Challenge

Sharp has developing a generation 2 dehydration membrane separation system for use in bioethanol production. The business needed support to commercialise their Hybrid Renewable Heating solution and develop appropriate business models.

Solution

CLT supported Sharp, initially as part of DECC’s EEF incubation support, and subsequently directly at Sharp’s request. The Sharp solution had consisted of PV-Thermal panels, a dual temperature heat pump and a hot water store with a heat management unit. The heart of the solution was its Smart Adaptive Controls, which allowed the system to optimise comfort, cost, and efficiency. Sharp’s solution was designed for mid-sized houses; it had provided 100% of a home’s heating and hot water needs and had had the lowest carbon intensity and operating cost of any heating system on the market.

CLT had provided initial support to develop the range of route to market options, customer value proposition and supply chain, in particular to identify a suitable manufacturing partner for the heat pump. This had involved market research and analysis to identify customer requirements and a review of the heat pump manufacturer landscape.

A relationship was established with MasterTherm to become the supplier of the heat pump for Sharp’s solution as a subcontract manufacturer and with its UK distributor as a sales channel for the solution.

CLT’s extensive discussions with installers had identified the high up-front capital cost as the main barrier to uptake of the system by householders. This was a key challenge. To address this, CLT has developed a range of innovative business models, including a heat-as-a-service model and a heating system lease option with no (or very low) up-front cost to the customer. The Heating System Lease option was developed into a full commercialisation plan. Led by CLT, a partnership was developed with Good Energy, which had an interest in trialling the system with its customers and also in modelling potential additional benefits of time-of-use tariffs to interface with Sharp’s control system. CLT developed a survey with Good Energy, which was issued to over 32,000 of its customers to test the attractiveness of the business model. Over 8,000 consumers had responded and the number of customers who would potentially buy the system was increased by over one third (2,800 to 3,600) under the Heating System Lease model.

Outcome

The results enabled Sharp to develop a viable business plan for the system’s market launch. An Innovate UK grant of £1 million was awarded, and strong partnerships were established.

“Sharp Labs of Europe had developed a novel hybrid PV-Thermal Heat Pump system with intelligent controls. CLT supported Sharp initially to develop the range of supply chain and route to market options for the system. The standard of the work delivered was very good and Sharp requested further work from CLT. This included market intelligence to understand customer requirements and development and financial modelling of a range of business model options, one of which was developed into a full business plan and financial forecast. CLT provided valuable support to Sharp throughout the process, were responsive to requirements and all written work produced was of a very high quality. The work was originally provided through EEF incubation support, but Sharp found it so valuable that we requested additional work from CLT at our own cost.”
— Martin Tillin, Sharp Project Lead for PV-T system development