Ceres Power
Using design to come up with a vision for its technology and sell that vision to investors and partners has put Ceres Power in the spotlight.
Background
Ceres Power was spun out from Imperial College in 2001 to commercialise fuel cell technology that generates heat and electricity. The cells are much more efficient than other ways of producing energy, like internal combustion engines, and their carbon emissions are much lower.
Ceres Power joined Designing Demand’s Innovate service soon after launching. The company floated on AIM in late 2004 and has raised more than £25m of investment. Its market capitalisation is £144m.
It is now moving towards the launch of products including a Combined Heat and Power (CHP) boiler that promises to revolutionise the domestic energy market by reducing energy bills by up to 40 per cent and also cutting carbon emissions.
Problem
Like all technology start-ups, Ceres Power needed funding to sustain research and product development. That meant convincing investors that the technology was worth backing. And that called for clear and persuasive communication of its benefits and commercial potential, as well as a strong brand.
Joining Innovate. Ceres worked with Design Associate Chris Thompson, who recalls: ‘We needed to explore what applications the technology could be used for, how we could get it to market and how we could communicate its value to potential partners and investors.’
Ceres Commercial Director Bob Flint adds: ‘It was absolutely vital that we developed a vision for what the technology could do and that we articulated it effectively to others.’
Response
Early work focused on creating scenarios around routes to market beyond the initial concentration on domestic heat and power. The aim was to make the company more attractive to investors by spreading risk.
The result was a new three-way focus: boilers providing domestic heating, hot water and electricity; off-grid units supplying power for homes and businesses without access to reliable grid power or acting as back-up for vital services from hospitals to temporary traffic lights; and support for automotive electrical systems like lorry refrigeration units or air conditioning in cars. In all these cases, fuel cells promise to cut fuel costs and emissions.
A clear picture of the benefits for both partners and consumers started to emerge. Bob Flint says: ‘Fuel cell-based heat and power systems are very attractive to utilities. They enable a move away from treating heat and power separately and towards an integrated solution. Also, consumers could cut their annual energy bills by between 25 and 40 per cent and reduce emissions by between one and four tonnes.’
Ceres’s technology is also more reliable, robust and cost effective than other fuel cells, and it can run on bottled natural gas or LPG, while many other cells only work on hydrogen. Flint says: ‘And we now know the boiler design will be small enough to be wall-mounted, taking up no more space than a conventional boiler. That’s a key market enabler, as other fuel cell boilers are floor mounted.
‘Designing Demand helped us to make applications and benefits easy for non-specialists to understand.’ An early example was a 3D video prototype, developed with external designers, showcasing the commercial possibilities for Ceres’s fuel cells. It was crucial to raising £10m of private equity investment ahead of the eventual AIM flotation.
In parallel, Ceres realised the need to develop a credible brand. CEO Peter Bance says: ‘We were a small start-up wanting to punch above our weight. Design was central to this.’
Although Ceres is mainly a business-to-business brand, consumer profile will become increasingly important, says Bob Flint: ‘We want to be the “Intel Inside” of fuel cells, the equivalent of what microprocessors are to PCs. When the technology takes off, many companies will offer fuel cell-driven products and the public need to know which ones they can trust.’
Impact
Ceres has formed two key partnerships. With Centrica, it is developing a CHP domestic boiler that combines fuel cells with conventional technology and could come to market in 2009. An off-grid power unit resulting from a tie-up with EDF Energy Networks is planned to launch around the same time.
As Ceres Power has developed, so has its use of design, says Flint: ‘Through Designing Demand we got our strategy straight in terms of target markets and improved our communications to get our technology understood and attract investment.
‘Now industrial design is helping us produce concepts that show partners and investors how heat and power can come from a single unit. And product design, interface design and understanding context of use will help us to integrate the product into customers’ lifestyles.’
Peter Bance adds: ‘For us, design is an approach and a philosophy. It permeates everything we do and we’ve believed in it from day one.’