Following a recent trip to Sweden, Mark Watson-Mitchell reports on an absolute corporate giant that is changing our environment
Thinking big, acting fast and getting things done!
Working quietly in the background, this group is a major player on the European business stage, the Swedish-based Vargas Holding, is a premier force in accelerating decarbonisation.
The group is a founder of ‘unicorns’ Northvolt, Polarium and H2 Green Steel, and has recently launched its fourth company, Aira.
In the business world, a ‘unicorn’ refers to a privately held startup company that has reached a valuation of $1bn or more and is considered to offer significant growth potential.
The new venture, that is targeting one of Europe’s largest emitters, will be at the forefront of pushing boundaries for a more sustainable future, disrupting old business models and making a significant positive impact on our climate.
The group’s Management, led by Harald Mix, Chairman, and Carl-Erik Lagercrantz, CEO, states that:
“Accelerating the transition to a sustainable future is everyone’s responsibility, and at the same time, an enormous opportunity. That is why we push boundaries in areas where it matters the most.
With a firm belief in the power of innovation and technology, we build impact companies that create solutions to today’s challenges – and for those of tomorrow. In this way, we will reach our vision to decarbonise one per cent of global emissions.”
Vargas Holding
Vargas is a long-term investor and an active owner of purpose-led companies, with an ambition to establish regional or global leadership.
Together with bold entrepreneurs, Vargas builds impact companies to realise ideas that push boundaries for a sustainable future.
It identifies, validates, finances, launches and then scales impact companies.
From its extensive experience, the group knows that true disruption requires new approaches and ways of working.
It has developed a greenfield model for building companies from the ground up, based on large-scale projects, vertical integrations and close collaboration.
The group started with green batteries, then went on to green steel, hydrogen and now into home energy-tech.
Northvolt, H2 Green Steel, Polarium and Aira are the group’s first impact companies, which are all aiming for regional or global leadership.
Northvolt
Northvolt is a Swedish company that specialises in the manufacturing of lithium-ion batteries, aiming to make oil history through large-scale production of green batteries.
The company was founded in 2016 by Peter Carlsson and Paolo Cerruti with the aim of building the greenest battery in the world and establishing a large-scale battery factory in Europe.
It focuses on developing sustainable and environmentally friendly battery solutions for various industries, including automotive, renewable energy storage, and industrial applications.
The company aims to contribute to the transition towards a more sustainable energy system by providing high-quality, high-performance batteries with a reduced carbon footprint.
One of Northvolt’s key projects is the construction of a massive battery factory called Northvolt Ett in Skellefteå, Sweden, which I visited recently.
This facility is intended to be one of the largest lithium-ion battery factories in Europe, with a planned production capacity of up to 40 GWh (gigawatt-hours) per year by 2024.
The factory will employ advanced manufacturing processes and utilise renewable energy sources, further aligning with Northvolt’s commitment to sustainability.
To develop and scale up its battery production capabilities Northvolt has also partnered with various companies and organisations in the industry, including Volkswagen, BMW, ABB, Epiroc, Volvo, Fluence, Scania and the European Investment Bank.
Overall, Northvolt is a prominent player in the battery industry, focusing on sustainable battery manufacturing to meet the growing demand for energy storage solutions in a greener and more efficient manner.
Polarium
Polarium is a leading energy storage developer.
It makes energy storage and optimisation solutions built on lithium-ion battery technology for businesses within the telecom, commercial and industrial facilities across the world.
Polarium was founded in 2015 on the conviction that safe, smart and sustainable energy storage solutions will be key to empower the transition to a truly, sustainable energy future.
This company is a fast-growing, entrepreneurial business headquartered in Stockholm, with production in Mexico, South Africa and Vietnam, having customers across the world from Ghana to Svalbard and with over 600 employees.
It is an impact business contributing to the sustainable energy transformation by enabling renewables, electrification and intermittent power supply.
With its cutting-edge and easily adaptable modular battery technology, it is enabled to be in the forefront of developing state-of-the art sustainable energy storage and optimisation solutions for today – and tomorrow.
Climate change is the biggest challenge of our time.
CO2 emissions need to decrease by half every decade until 2050, in order to reach net zero.
We need to move from 80% fossil dependencies to 90% renewables in 30 years.
Storing renewable energy so that it can be used not only when produced, but when it is needed, is one of the greatest barriers to the clean energy transition.
Energy storage is the missing link in the sustainable energy system.
The Polarium mission is to unlock endless energy and maximise value creation for its customers through that cutting-edge technology.
Its energy storage solutions enable customers to: secure reserve power by maintaining uptime and avoiding blackouts; reduce energy costs by avoiding price peaks; create new revenue streams through participation in the frequency regulation market; and establish energy independence by maximising the opportunity of renewable production such as solar panels to go off-grid.
As a front-runner, the group continues to invest in cutting-edge technology out of its newly inaugurated research and development centre, thereby ensuring that it continues to re-shape the role of energy storage and then empower the transition to a sustainable future.
H2 Green Steel
H2 Green Steel is a Swedish company that aims to produce fossil-free, high-quality steel using green hydrogen as a reduction agent and thereby powering a new clean industrial revolution.
The company was founded in 2020 with the goal of revolutionising the steel industry and contributing to the transition to a more sustainable and carbon-neutral future.
The traditional steelmaking process involves the use of coal or natural gas as a reducing agent, which releases significant amounts of carbon dioxide (CO2) emissions.
H2 Green Steel aims to replace these fossil fuels with green hydrogen, which is produced using renewable energy sources like wind or solar power.
By utilising green hydrogen in the steel production process, the company intends to achieve a near-zero carbon footprint.
The company plans to build a large-scale steel production facility in Northern Sweden, in the region of Norrbotten.
The facility, known as ‘The H2GS Factory,’ will employ advanced technologies such as electric arc furnaces and hydrogen-based direct reduction, allowing for the production of high-quality steel while minimising environmental impact.
The company’s vision extends beyond just producing green steel.
It also aims to create an entire ecosystem for sustainable steel production, including the development of renewable energy infrastructure and partnerships with suppliers and customers who share their commitment to decarbonisation.
By pioneering the use of green hydrogen in steel production, H2 Green Steel hopes to contribute to the reduction of greenhouse gas emissions in the steel industry and accelerate the transition to a more sustainable and circular economy.
Its investors include Hitachi Energy, Kobe Steel, Scania, Mercedes-Benz, and Kingspan. Its customers include BMW, Electrolux, Bilstein, SPM and Miele.
Aira
The heating of residential buildings is Europe’s third largest contributor of CO2 emissions.
Aira aims to provide clean energy-tech solutions to consumers and is targeting to become Europe’s number one brand within the industry.
The company was founded by Vargas in Stockholm, Sweden, in 2022, with a mission to empower people to join the clean energy revolution, one home at a time.
Aira, which is a direct-to-consumer brand, looks to accelerate electrification of residential heating with intelligent clean energy-tech to enable the net zero future we all need.
The enemy is the gas boiler and Aira looks to be the catalyst to get Europe off gas.
Switching to a heat pump running on electricity instantly reduces CO2 emissions by at least 75%, increasing to 100% with fossil-free electricity generation.
With Aira, consumers across Europe have a go-to-provider for complete home energy saving solutions, with intelligent heat pumps at the heart.
Its consumer-centric subscription model and vertical integration enables the best consumer economics and cost leadership.
Headquartered in Stockholm, Sweden, with 200 employees, Aira’s first markets are Italy, Germany and the UK, and Aira has already secured a manufacturing site in Wroclaw, Poland.
The company plans to scale into more than 20 countries, to employ 10,000 Clean Energy Technicians, and to serve 5m European homes with greener and cheaper residential heating within the next 10 years, by so doing it is targeting a CO2 reduction which is the equivalent of taking 10m cars off the street.
Aira is on a mission to change that by supporting the net-zero transition and cutting consumers energy bills.
By electrifying residential heating with intelligent technology, it is empowering people to join the clean energy revolution, one home at a time.
This technology has already proven its effectiveness in Sweden, where 60% of households already have a heat pump installed and they account for 92% of new heating system installations.
Savings from day one, with zero up-front costs, typically amounting to €15,000–€25,000, and an affordable monthly fee lowering monthly heating bills by up to 40%.
Aira plans to offer a hassle-free customer experience, taking the customer from quote to installation within four weeks and offering an industry leading 10-year warranty, together with a money-back indoor comfort guarantee.
The market for clean energy-tech has a significant, and still largely untapped, potential.
To meet a booming demand for heat pumps, Aira will swiftly establish and grow its business over the coming years.
To conclude
Vargas Holding, with its four ‘unicorns’ is working quietly in the background, aiming to build up from being a major player on the European business stage, into becoming a premier force on the global stage in accelerating decarbonisation.
Its constituent companies are gaining prominence and, as they begin to achieve their various goals, their efforts will become recognised across the world.
* So exactly what is a ‘unicorn’?
A Unicorn startup company is a private company that is looking forward to significant growth, having a post-money valuation of $1bn or more.
The term was coined by venture capitalist Aileen Lee in 2013, drawing an analogy to the rarity of spotting a mythical unicorn.
Unicorns are typically high-growth companies that have attracted significant investments from venture capitalists, private equity firms, or other institutional investors.
The term ‘unicorn’ is used to highlight the exceptional achievement of a startup reaching such a high valuation before going public or being acquired.
Historically, it was relatively rare for companies to achieve billion-dollar valuations in their early stages.
However, with the rise of technology and the increased availability of venture capital, the number of unicorns has grown significantly in recent years.
Unicorns often operate in sectors such as technology, e-commerce, software, biotechnology, or fintech.
They are characterised by disruptive business models, innovative technologies, and the potential for rapid expansion and scalability.
It is important to note that a high valuation as a ‘unicorn’ does not guarantee long-term success or profitability.
The valuation is based on investor confidence and potential future prospects, and the actual financial performance and sustainability of a unicorn may vary.
The collective noun for a number of unicorns is a ‘blessing’.
