BKTECH – A Swedish Success Story
We learn how an attempt to recycle some felled trees became a valuable player in the renewable energy sector.
It all started on a dark and stormy night. It is a classic opening for a reason, but for BKtech it is also true. “The company was founded due to the aftermath of a giant storm in south-east Sweden in 2005. A lot of the trees in the forest in south Sweden were damaged, a lot of trees were about to be destroyed,” explains Jimmy Rylander, BKtech’s CEO. “The company’s founder decided to start a factory to make wooden pulps from all these fallen trees. He was the son of a forest owner in the south-east of Sweden, so he had a lot of forests to take care of.”
BKtech’s first factory was built close to the founder’s family home, and in 2005 he started to produce wooden pellets for use in boilers and burners. He would sell them to villa owners and the industries within a 100km radius. As the business grew, he saw there was demand not just for the wooden pellets, but for the boilers and burners themselves.
“He started to develop his own boilers and burners business, at first pretty small facilities, and some years later he started to build even to industrial scale,” Rylander recalls. “These weren’t about producing energy, they were producing water steam and hot water.”
The business continued to grow over the following decade, until eventually it could no longer be contained on the founder’s parents’ farm. He bought a new facility and started to build mobile energy centers for industry full-time. In 2017 the factory started to build the products it is still producing today, energy centers for industry producing water steam and hot water.
“By 2017 we had a turnover of around £2 million, and today we have a turnover of approximately £20 million,” Rylander says. “We have upgraded 30 different facilities in Sweden where we’ve delivered our energy centers. And that is where we are today.”
Rylander himself is a relative newcomer to this story, taking on the ground of Group CEO for BKtech last November.
From the outset, however, he has been able to see that BKtech has something special.
“We are building pretty large-scale energy solutions, but they’re still mobile so we can drive them out to the customer,” Rylander points out. “We build and integrate everything in our own factory and drive it to the customer, even up to 15 MW. That’s unique. We’re the first in Sweden and probably the world to be able to produce 15 MW facilities that are 100% mobile.”
BKtech’s energy centers can be put on wooden skates and rolled into facilities already in place or set on a foundation that BKtech constructs adjacent to a factory.
The Case for Savings
While the business has been growing consistently, it can still face challenges in winning over new customers.
“It almost always comes down to the financial side of things,” Rylander acknowledges. “When a customer wants to go renewable in the energy field it means working in a field that is not what they do for a living. Our customers want to produce products, launder clothes, peel potatoes etc. So, when it comes to energy, this is not their daily business.”
That means it can be difficult to convince customers of the benefits of investing £1-3 million in an energy facility to become renewable. However, as Rylander points out, the case for BKtech’s solutions is a strong one.
“That is normally the biggest issue. They don’t understand why they should invest,” Rylander says. “But actually if we compare what we can give them and what they can get from gas or oil, we can produce the same amount of energy, but make it 40 to 50% cheaper to produce with wooden pellets or wooden powder even if they invest in a totally new facility. We normally make a ten-year contract with the customer. Over ten years they will save between 40 and 50% by changing from oil or gas to renewable fuels.”
As well as offering excellent value for money, BKtech’s energy centers can also be installed with the minimum of disruption to ongoing business functionality.
“We don’t interact with the customer’s own production processes for more than a week,” Rylander explains. “They can have their production ongoing and produce their own energy and we put our installation on the cart, drive it to the production site, put it on the foundation, connect it to their factory and when we’re done they can stop their old oil burner and start ours. It’s seamless.”
While BKtech is looking to move into manufacturing its own boilers, it has also depended on strong relationships with a number of key suppliers, including VEÅ AB.
“In the lower range of 1-15 MW we’re using VEÅ AB’s boilers and will probably continue to do so for many years to come,” Rylander says. “What we’re developing right now is a high-capacity range, with a smaller boiler than what we get from VEÅ AB but with similar capacity.”
Ready for Growth
Over the last four years, BKtech has seen its revenue grow by 1,000%, and its next goal is to grow its turnover from 200 million Swedish kronor to 1 billion.
“We think we will be there within three years from now, we’re growing very fast,” Rylander says. “We’ve started to get a lot of questions from outside Sweden, but we’re focusing on the Swedish market for now. We have a new sales director we’re putting in place and then we will be a bit more proactive in the world markets.”
To prepare the company to meet those markets, BKtech is once again looking at expansion.
“We have limited space where we are today. So, one of the next steps is to build new facilities, boilers, burners and power plants,” Rylander says. “The first will probably be in Sweden, but we’ve also ones coming in northern parts of Europe. It is possible we will be in Great Britain. Although we produce everything in our plant today it is easier to have people on-site who come from the country we are going to deliver to, to get past language barriers, for example. So we want to have partners in each country, agents, start-ups to sell things for us in different markets. That will be the next step in our international expansions.”