THE economy and the environment have always gone hand-in-hand in the small farming community of Llandrindod Wells, Powys.

After a doctor discovered its mineral-rich springs, the town was transformed into a fashionable Victorian spa resort. It’s no exaggeration to say Llandrindod was built around its wells.

Today, the area is home to one of the most successful climate tech companies in Wales. Riversimple, the hydrogen car manufacturer, announced a £150million projected funding round last year.

And that’s not all. A recent Tech Nation report shows that funding in Welsh climate tech companies increased by a factor of 25 between 2019 and 2020.

Even without Riversimple’s contribution, says data scientist Glen Learmond, funding in Wales rose by triple the UK average.

So why have Welsh climate tech businesses proved so successful?

In the centre of Llandrindod Wells is a two-storey building with ‘Tom Norton Limited’ emblazoned on its art deco facade.

Once it was home to the first Ford and Austin agencies in Wales. Norton, the former owner, is thought to have sold the country’s first Model T.

Now the property contains a bicycle museum, a handful of shops, and not a single car. But its reputation was enough to convince the Riversimple team to move west from its base in Ludlow, Shropshire.

“We came across the border to find good workshops in which we could develop and build a small run of hydrogen cars,” says director Fiona Spowers.

‘The Automobile Palace’ – as the building is still known – “gave us the sense that Llandrindod has been home to automotive innovation before and would welcome it anew.”

Riversimple settled slightly north of the landmark, a three-minute drive away.

The surrounding area also appealed to the start-up. Nearby hills have allowed for stunning test-drives, while the Royal Welsh Showground in neighbouring Builth meant it had somewhere to test prototypes.

With its recent projected investment, Riversimple plans to create two factories in Wales to commercially produce its ‘eco coupé’, the Rasa. Each site is estimated to create around 200 jobs.

Soon after Riversimple relocated to Llandrindod Wells, the Welsh Government provided a research, development and investment (RD&I) grant of £2million.

In fact, all of the Welsh climate tech companies that attracted venture capital in 2020 have had government support at some stage of their development.

CrossFlow Energy, for example, brought in private investment worth £1.2million last year. In 2017, it received £1million in SMART Cymru funding to develop a prototype wind turbine.

“The Welsh Government wants to be a world leader of the transition to a zero carbon economy,” notes Sarah Jenkinson of the Machynlleth-based Centre for Alternative Energy.

This means “there is an increased availability of finance for clean tech businesses”.

Project Blu, which recycles ocean plastics for pet equipment, is a beneficiary of Business Wales’ accelerated growth programme. The initiative aims to provide high-growth companies with mentoring and business scaling advice.

The company’s two venture capital rounds were not made public, but it gained £150,000 through an accelerator.

Transcend Packaging is another alumnus of the programme. In 2020, it combined part of its £10million investment from IW Capital and a Covid-19 RD&I grant from Business Wales to double its workforce.

Penallta Colliery, which lies a mile from Ystrad Mynach in the Rhymney Valley, used to be one of the largest pits in South Wales.

Though the mine has been closed for decades, the landscape has quite literally been shaped by its industrial past. A short walk from the old colliery is Sultan the Pit Pony, an earth sculpture built from 60,000 tonnes of local coal shale.

If you want a vision of the area’s industrial future, you need to head into Ystrad Mynach, where Transcend Packaging has its headquarters.

Here, under the umbrella of sustainable packaging, the company makes everything from McDonald’s paper straws to biodegradable PPE for the NHS.

The “passion, skills and resources” of the local business community and transport links to Cardiff were crucial to setting up in South Wales, says CEO Lorenzo Angelucci.

Moreover, if you drive half an hour from that local business community, you end up in Cardiff. The city’s transport links mean Transcend can easily export its goods arounds the world.

A nearby business hub – Cardiff contributes about a fifth of Wales’ gross value added – it also means access to skilled labour and potential customers.

All of these advantages make the area “extremely competitive versus other locations in the UK,” Mr Angelucci believes.

Cardiff’s proximity has another benefit for Transcend: it allows it to headhunt talented graduates.

One of them was Christopher Scourfield. While at Cardiff University in 2019, he worked a 20-week placement with the business, returning a year later as a commercial analyst.

“He impressed us so much we had to bring him back,” reads the announcement on Facebook.

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Moving westwards, Swansea University is located just a short trip around the bay from CrossFlow Energy.

Professor Mark Cross led a team from the engineering faculty in a series of Crossflow-sponsored experiments. Using advanced computer modelling, they helped design the company’s signature wind turbine.

Most wind turbines have three blades. CrossFlow’s has eight. Together they form a cylinder which revolves 90 per cent slower than a typical turbine, meaning reduced noise and greater durability.

For some, climate tech investment might seem like a niche concern. But Wales’ entrepreneurial history, universities, financial hubs and government support have provided the perfect conditions for these companies to transform our everyday lives.

Maybe it won’t be long before the Rasa becomes a familiar sight, or CrossFlow wind turbines are dotted about the landscape.

And some believe this is just the start.

“We feel strongly that Wales [...] has immense potential to lead the world in developing a sustainable energy ecosystem,” says Riversimple director Fiona Spowers.

“It has the natural resources, the skills, the agility and the mandate.”

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