Climate change is a “defining factor” in the long-term prospects of businesses. So said Larry Fink – boss of leading asset-management firm Blackrock – in an open letter he wrote to chief executives around the world in January, shortly before COVID-19 hit pandemic levels. What’s interesting is that as the world emerges from lockdown and governments look to restart their economies with stimulus packages, many are taking the opportunity to attach “green strings” to their support.

The world’s greenest pandemic bailout initiative so far is the European Commission’s €750bn recovery package. Unlike many national COVID-19 support schemes, EU member states that want funds must show they will use the money in line with Europe’s Green Deal to eliminate net greenhouse-gas emissions. The UK has its own Green Recovery Programme, which seeks to drive investment in low-carbon innovation, infrastructure and industries, supporting sectors that increase job creation and decarbonization.

As governments look to restart their economies with stimulus packages, many are taking the opportunity to attach “green strings” to their support

Such programmes essentially involve providing financial support with green caveats attached, which is great news for the “clean technology” sector. However, any such clean-tech improvements will not happen overnight and may take several years to get to market. What’s more, falling profits and reduced business confidence following COVID-19 will lead to companies cutting their spending on research and development, unless appropriate support and encouragement are in place.

That’s why I was delighted to see, here in the UK, chancellor Rishi Sunak increase the Research and Development Expenditure Credit (RDEC) from 12% to 13% to help businesses invest in R&D. More significantly, the UK government is currently holding a consultation on how to refine the scheme to make it more effective at stimulating growth and investment – something that I and others on the Business Innovation and Growth (BIG) group of the Institute of Physics (IOP) have been pushing since it was set up in 2018.

The BIG group and the IOP’s policy team will be responding to the consultation by reminding the UK government how physics-based firms can take a lot longer to develop especially as scaling up prototype products and processes is risky and expensive. But, once established, such firms have a sustained competitive advantage and often export globally. They also encourage basic science, develop patents, employ talented people and boost manufacturing.

Innovation in action

Given the emphasis on green technology in the post-COVID future, I was therefore pleased that several of this year’s IOP business award winners, which I was involved in selecting, are exactly the kind of clean-tech companies we need.

They included Hirst Magnetic Instruments, a research-led company founded in 1938 that develops and makes equipment to test, measure and produce magnets. Headed by John Dudding, it focuses on the growing market for magnetic-material characterization, which is vital for improving the efficiency of motors in electric vehicles. Hirst’s materials equipment and magnetizers are supporting materials testing in China and the production lines of companies in the electric-vehicle supply chain.

Meanwhile, one company to win an IOP business start-up award this year was QLM Technology, which is developing low-power tunable-diode LIDAR gas-imaging systems based on infrared single-photon detection. Its prototypes have produced some amazing camera images that show parts-per-million levels of methane in the atmosphere measured at distances of up to 200 m. Methane is the second most important greenhouse gas – being roughly 30 times more potent at trapping heat than carbon dioxide – and there are over a million gas and oil-well pads around the world, which are leaking much more than they should.

QLM’s low cost, accurate and robust devices are exactly what’s needed for widespread emissions monitoring and meaningful regulation. Indeed, the company is already developing products for industry leaders such as Ametek, BP and the National Grid, with plans to deliver industry-ready products early next year.

Perhaps the most intriguing of the IOP’s start-up winners was FeTu, a company set up in 2016 by chief executive Jonathan Fenton, whose Fenton Turbine seems the closest we have got so far to the ideal, closed-cycle reversible heat engine first imagined by thermodynamics pioneer Nicolas Carnot in 1824. The turbine, the firm claims, could replace compressors, air conditioners, fridges, vacuum pumps and heat pumps with efficiency savings across the board.

Read more

First-hand insights: why direct contact with hi-tech firms helps you spot their potential

It sounds like a “too-good-to-be-true” technology, but Fenton has sensibly set out to prove that’s not the case, with some remarkable results. The turbine is complex to describe but the first version – a “bare-shaft” unit – cuts the energy cost of compressing gases like air by 25%, with the result proven in independent tests carried out by researchers at the University of Bath. That’s promising for FeTu given that 10% of all electricity used by companies in Europe goes on compressing air – roughly 80 terawatt hours consumption per year.

As many of the IOP’s award winners illustrate, plenty of these clean-tech innovations are firmly rooted in physics

What’s more, an “open-cycle” variant of the company’s turbine can, when configured to act as a heat pump, be as efficient as air-conditioning units and refrigerators – despite using just air as the working fluid. It therefore has great environmental potential given that conventional “phase-change” refrigerants are some 2500 times more potent than carbon dioxide as greenhouse gases. FeTu says it is making good progress with customers where the energy saving and environmental advantages are clear. It is also developing a “closed-cycle” variant of the same machine with even greater efficiency improvements in store.

As many of the IOP’s award winners illustrate, plenty of these clean-tech innovations are firmly rooted in physics. I believe that research and development will be critical to ensure both economic and social recovery from the impacts of COVID-19, enabling us to build a greener, healthier and more resilient world. The IOP’s business award winners are therefore well placed to contribute to that endeavour.