02.10.2023 | Case | Nordic SME | Industry | United Kingdom
The booming offshore wind power industry needs accurate weather data to maintain its windmills. Norwegian weather station specialists Automasjon og Data wanted to strengthen its foothold in the offshore wind market, and funding from Nefco – the Nordic Green Bank – helped it expand its operations in the UK and Southern Europe.
Accurate weather data secures the maintenance of offshore wind
With the world rapidly shifting towards renewable energy, the global production of wind power is rising by double-digit percentages annually. As prime land for windmills becomes scarce, more and more wind farms are built offshore.
However, the construction and maintenance of offshore wind farms is costly. Factors such as wind, wave and current speeds and directions impact the safe approach of maintenance vessels and personnel. To service the windmills, wind farm operators need exact weather information from the site.
How to enter a growing market?
Automasjon og Data has decades of experience providing specialised weather stations for the oil and gas industry. Offshore drilling sites face similar challenges to offshore wind farms. The company’s equipment is extremely robust and suitable for precise measurements even in the raging winter storms of the North Sea.
As the oil and gas industry slowly but surely diminishes, extending its offering to the new market is a logical move. “We have established a foothold in the offshore wind market in the last 6–8 years. As the offshore wind market grows rapidly, this will be our main market in the future. That’s why we wanted to enter new countries and develop our products further,” says Jon Arne Silgjerd, Chairperson of Automasjon og Data.
The company set a goal to increase the revenue share from the wind power industry to 50% of Automasjon og Data’s total revenue. To speed up its progress towards this milestone, it needed external funding. However, funding can be hard to secure for many small and medium-sized enterprises (SMEs), as banks are unwilling to finance risky projects.
“Offshore wind will be our main market in the future. That’s why we wanted to enter new countries and develop our products further.”Jon Arne Silgjerd, Chairperson of Automasjon og Data.
Nefco’s funding speeds up international growth
Automasjon og Data was familiar to Nefco, as it had applied for funding from Nopef fund about 10 years ago. Nopef provides funding for leveraging green and sustainable solutions of SMEs in the Nordics for the global markets. Automasjon og Data started dialogue with Nefco again in 2021 about its new ambitious expansion goals.
“The UK is one of the biggest renewable power markets in Europe. Once we secured funding from Nefco and Innovasjon Norge, we acquired a company in Aberdeen to gain a stronger foothold in the market,” Silgjerd explains.
Without funding, Automasjon og Data could not have expanded so rapidly. “Entering a new market requires dedicated people. When acquiring another company, there are always costs that you don’t necessarily expect. That’s why good funding is key. With Nefco’s funding, we’ve also been able to hire dedicated sales personnel to work on offshore wind in Southern Europe,” says Silgjerd.
Nefco can help small and medium-sized enterprises secure funding when banks are unwilling to finance risky projects
According to Silgjerd, the acquisition has proved successful: “We attracted many clever people and learned new things from them. We’ve been able to restructure the business and grow together.”
The project was a good fit for all, as it hastens the transition from oil and gas to renewable energy. To increase the capacity of offshore wind, reliable weather data is needed, so Nefco was willing to take the risk. The company received financing from a fast-track loan, at the time known as a green recovery loan. They provide SMEs with the financing they need to conquer global markets with their sustainable solutions.
The collaboration has proved fruitful. “From the start, Nefco has been very interested in what we do, and we’ve discussed projects in detail. They’ve also advised us on accounting practices to ensure that the funding is used as planned. It has been a pleasure working with them,” Silgjerd continues.
Jon Arne Silgjerd, Chairperson of Automasjon og Data and Roger Lillestøl, CEO. Photos: Automasjon og Data
What’s next for Automasjon og Data?
All arrows point upwards in the renewables market, and the company is on an upbeat growth track. While growing its UK and Southern Europe businesses, Silgjerd says that Automasjon og Data is simultaneously exploring new markets in Asia. It is preparing for the rise of floating wind farms that can replace fixed windmills, for example. “We are following the market and observing where it grows.”
“Nefco’s funding has helped us stay on track and know where we are going,”Jon Arne Silgjerd, Chairperson of Automasjon og Data.
However, market transformation is not always easy, as the oil and gas industry is still profitable and lucrative. “It takes dedication not to slide back. We realise that we must focus on our long-term goals and be a part of the green transition. Nefco’s funding has helped us stay on track and know where we are going,” Silgjerd concludes.