How One Swedish Solar Business Plans To Take The Globe By Storm

Stockholm-based Soltech Energy brings in roofers and electricians and then “sprinkles” in a little solar energy. And the listed company is growing rapidly. Chief Executive Stefan Ölander says his young adult children are finally patting him on the back – a man who has devoted himself to environmental businesses and charities for the past two decades.

The business case: Sweden aims to generate all of its electrical power from renewable energy sources by 2040. As such, solar energy would increase from 1% today to at least 10% by then. In addition, Swedish companies want to minimize their environmental footprint while brightening up their public image. As a result, customers in need of new roofs will now inquire about solar installations. Traditional roofers are often stumped. But Ölander saw the potential.

“Every cent we earn is good for the environment,” Ölander told this writer in an interview. “The companies we buy choose to merge because they want to be empowered – to be part of the future. You must have knowledge of solar energy, roofing and electricity to be the best. If you know roofs, you can go to both companies. If you can do the electrical work, you can also do the solar installations.”

Ten years ago, Ölander had a brand office in Stockholm. He was also an investor in Soltech, which at the time was a sleepy $6 million company. About two years ago, he became the chief executive and went on a shopping spree. In total, he has bought 16 family-owned roofing and electricians businesses and has more in mind. Revenues jumped to $60 million last year and are expected to double by 2021. And by 2024, the goal is to reach $600 million.

Soltech’s customers include ABB, H&M, Volvo Cars, Castellum Inc. and Ericsson. While commercial and industrial enterprises make up 90% of their turnover, the company is preparing to take a deep dive into the residential market as well.

However, the best prospects are not on the roof, but on the sides of warehouses. Ölander says the “solar facades” market is “totally untouched” and some of those exteriors are 10,000 feet tall. Instead of installing windows, they install solar cells. Growing that segment would require older buildings to be renovated, while new ones could accommodate the technology. The solar cells are aesthetically pleasing and have a degree of transparency of 70%, allowing you to see outside.

“We believe we are on an interesting journey and we have 65,000 shareholders to show for it,” he says. “We can take a family business and bring it into a publicly traded company and it’s now worth 8 to 10 times more than it was.” His company’s market cap is now $250 million.

The scope of capitalism

The competition is stiff. Tesla
TSLA
, for example, installs ‘sunroofs’. His pitch: Customers can go green while avoiding rolling blackouts. According to Elon Musk, the power density of solar tiles is improving, allowing them to produce more electricity. At the same time, he says that solar roofs are more economical than conventional solar panels that have access to battery storage.

Tesla has installed about 6.3% of the US residential solar market, says Wood Mackenzie Power & Renewables. Vibrant Solar Energy
VSLR
and Sunrun
RUN
are the leaders.

However, verwelkomtlander welcomes Tesla’s participation. For starters, he says Tesla has yet to put in an “underlayment” before installing the solar tiles. Incidentally, every roof with solar panels or panels must have a lifespan of at least 25 years. Like Tesla, Soltech outsources its panel production to companies such as CanadianSolar, JinkoSolar and Trina Solar.

“I hope Tesla will succeed,” he says. “I want Musk to put as much effort into this as possible — to power the company for integrated and aesthetic solar power. I want him to go around the world selling this stuff.”

The business case is strong. Currently, Sweden is mainly powered by hydropower (40%) and nuclear energy (30%). The growth of solar energy there will come at the expense of natural gas. But it could also nibble at the feet of the nuclear power sector that is there in the crosshairs of the government. But can solar power be effective in Northern Europe? Solar energy is now 5% of Denmark’s electricity market. And it’s 10% of the German portfolio. Ölander says that the efficiency of solar panels decreases as it gets warmer. Moreover, the summer sun in Scandinavia does not set until midnight.

The moral imperative is also imperative. The scope of capitalism is broadening and now includes not only the interests of shareholders, but also those of their internal and external communities. That is why sustainability is an essential part of many company missions. If it’s not sustainable, it could affect the brand.

“I’ve been working in environmental affairs and communication for 20 years and I’m not ashamed to make money,” says Ölander. “You get more done when you are driven by monetary conditions.

“There is a good chance that other solar companies will do the same as we do,” he continues. “But before they know, I bought more companies. It will be another pat on the back if someone copies our business strategy. We are now looking to expand to other European countries. My goal is to have 100,000 shareholders.”

Soltech’s innovative solar energy activities ensure exponential growth. But its experience is also a predictive sign: the need for traditional companies to rethink their strategies for survival during the era of renewable energy.

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