Interview: Liverpool based clean tech company Heatio awarded £1.2m funding

As part of our 2024 Innovation Week, in association with Innovation SuperNetwork, we hear from Liverpool-based clean tech company Heatio is part of two initiatives worth £1.2m, to help homeowners improve the heat efficiency of their properties and save on their energy bills. 

Thomas Farquhar, co-founder of Heatio told me heatio is, focused on "trying to remove the barriers to mass scale deployment of renewable technologies. So getting people access to clean and affordable energy is our ultimate goal."

The £1.2m in funding has been awarded by the Department for Energy Security & Net Zero through its Net Zero Innovation Portfolio (NZIP) Green Home Finance Accelerator (GHFA) scheme. 

The first scheme introduces the Energy as a Service solution (EaaS), a subscription-based product that aims to eliminate upfront costs for consumers considering heat pumps, solar PV, or battery storage. 

Around 350 households in the North West of England will have the opportunity to be the first to benefit from this new service agreement, which is a partnership between Heatio, E.ON and  Energy Systems Catapult, when it’s launched in the Spring. The solution will also integrate a bespoke E.ON energy tariff, further reducing costs. 

I was a bit shocked that something along these lines didn't already exist in the UK. I had to ask Thomas why that is. Thomas told me that, "the reason it doesn't exist is because from a financing point of view, most financiers can get their head around asset finance, because it's easy, I buy the car and then rent it out for three years and is worth so much at the end, then I sell it and it's a straightforward model."

Instead, he compared it to a Sky Box subscription saying, "you don't own your Skybox, you pay to access the TV channels. This is a similar sort of premise where you're paying to access the savings."

The second project sees Heatio join Perenna Digital Bank and Energy Systems Catapult to provide a 20-30 year fixed rate green mortgage that rewards homeowners with a preferential interest rate for retrofitting their homes with low carbon technologies.

Those considering the installation of clean technologies such as heat pumps, solar PV, or battery storage will be rewarded with a lower interest rate on their mortgage once the improvements have been completed and validated by the Heatio Flexx platform & home energy management system.  The new finance option could save homeowners around £400 a year. 

Thomas said, "most of the mortgages in the market reward you for already being efficient. So if your home is already nice and efficient, or you've got renewables installed, you get a better mortgage deal. Whereas Perenna's idea was to bring a mortgage to market that incentivizes those that haven't done anything to do something."

With the UK’s housing stock responsible for 40 per cent of the UK's total emissions, decarbonising people’s homes plays a pivotal role in the UK’s carbon reduction efforts. The projects aim to facilitate the adoption of alternative energy sources by making the market accessible to those with lower incomes and no available capital.

A core component of each initiative is the Heatio Flexx, Home Energy Management Solution, which implements a data-driven approach to deliver an accurate energy profile and home insights to suggest energy-efficient technologies tailored to individual households based on their actual energy usage patterns and property characteristics. 

Thomas Farquhar, co-founder of Heatio, says: “The most important step towards better energy efficiency and encouraging the adoption of low-carbon technology in UK homes is to remove the financial barriers for the customer. Until now, solar panels, battery storage and heat pumps have often been seen as a luxury only the affluent can afford. Many consumers don’t know where to start making energy efficient improvements and are unable to manage the expenses associated with installing, operating, and maintaining technologies like heat pumps and Solar PV. That is about to change. 

“Firstly, through a next generation Green Mortgage product that offers a lower interest rate and could save thousands of pounds for the householder, as well as helping with upfront costs to those who install clean tech in their homes. Secondly, through our Low Carbon subscription solution, which will enable consumers to avoid the upfront cost of low-carbon energy solutions such as solar PV, heat pumps and battery storage with a monthly subscription that will unlock significant home energy savings.”

It's safe to say that the funding Heatio has received to innovate in the Clean Tech industry is only the beginning of their journey to help bring the country closer to our net zero goals. I for one can't wait to see what they do next.