Liz Allan [00:00:27]
Right. Okay. So on today's episode, I have got Daniel Särefjord from Aira. Now we met back in May at Everything Electric in Harrogate. Before I properly say hello, Daniel is the CEO of Aira UK and the group CCO of Aira Group. Thank you for joining me. It's been a while, but you're such a busy chap, aren't you?
Daniel Särefjord [00:01:17]
Thanks, Liz. It's a pleasure. It's been a while, but I'm really looking forward to a great discussion.
Liz Allan [00:01:25]
And I think there's going to be a lot that people can learn today. I always like to start by asking about how people came to be in their current roles. What did you do in your background that brought you to where you are now?
Daniel Särefjord [00:01:49]
Right. So, I'm an engineer by training and I was a computer science enthusiast growing up, convinced I’d become a programmer. But my career took me into services, working with selling, servicing, and maintaining customers in different service industries, from telecom to home security. For the last 9 years before joining and helping to found Aira, I was with a company called Verisure, the European leader for home alarms.
Liz Allan [00:02:39]
Okay.
Daniel Särefjord [00:02:39]
Interestingly, the home alarm industry was fragmented, like the central heating and plumbing industries are today. It had manufacturers, wholesalers, distributors, and thousands of local locksmiths and electricians, making it expensive and complicated to get a home alarm. Verisure realised that people just want to feel secure and would prefer security as a service—an end-to-end solution. I helped scale that company from 5,000 to almost 30,000 employees across Europe and South America.
When I was contacted by the founders of Aira, they were looking at the residential heating market, which accounts for a significant portion of Europe's total emissions. They saw an opportunity in the UK where residential heating emissions are much higher than in Sweden, where heat pumps are prevalent.
Liz Allan [00:05:07]
Okay, that makes sense.
Daniel Särefjord [00:05:07]
Our founders are impact investors who build companies in industries needing decarbonization. They noticed that the heating industry, like the home alarm industry, was fragmented and disjointed. The hypothesis behind Aira is that developing a new product alone isn't enough to decarbonize the sector. The existing product, the heat pump, already works well in Sweden and Scandinavia. However, it's a market where most boilers are still gas-based, and consumers are often unaware of better options.
Liz Allan [00:08:45]
That’s a great explanation.
Daniel Särefjord [00:08:46]
Yes, and we see a business model similar to Verisure's. Instead of treating it as a product, we offer an end-to-end service. We manufacture the products, provide installation, and maintain them. We believe that customers don't see it as replacing a gas boiler; they see it as needing a new central heating system. We want to be the go-to brand for clean energy tech that helps customers decarbonize their homes and save on energy bills.
Liz Allan [00:11:24]
I remember when we met in Harrogate, you mentioned offering free training to gas boiler engineers to upskill them for installing Aira heat pumps. Can you explain that a bit more?
Daniel Särefjord [00:11:46]
Yes, exactly. We’ve opened two Aira academies, one in Sheffield and one in the south of London, to train technicians in installing and maintaining heat pumps. Most of the skills needed are already present in the workforce; it's just about adding specific knowledge regarding heat pumps.
Liz Allan [00:15:20]
So, are you converting technicians who are already working with gas boilers or heat pumps?
Daniel Särefjord [00:15:57]
We employ gas technicians and convert them to "clean energy technicians." We believe in having a specialised workforce focused on heat pumps, unlike traditional plumbers who spend most of their time on gas-related work.
Liz Allan [00:17:51]
What do people need to have these systems installed in their homes?
Daniel Särefjord [00:19:01]
For most people, it’s just a matter of exchanging the heat source. If you have a gas boiler heating your radiators, a heat pump can do the same. The main difference is that a heat pump requires a hot water cylinder. There are also space requirements for the outdoor unit, which works like a refrigerator in reverse, harvesting and moving heat from the outside air into your home.
Liz Allan [00:24:47]
That makes sense. Do you need a lot of space for the outdoor unit?
Daniel Särefjord [00:26:06]
Not necessarily. About a meter of space around the unit is sufficient for air circulation. Finding space is rarely an issue if you have a garden or yard.
Liz Allan [00:29:13]
There are government incentives, like the Boiler Upgrade Scheme, to encourage adoption. Are these making a difference?
Daniel Särefjord [00:29:31]
Yes, absolutely. The Boiler Upgrade Scheme offers a £7,500 grant for replacing fossil fuel heating systems with low-carbon alternatives like heat pumps. This significantly reduces the cost difference between installing a new gas boiler and a heat pump.
Liz Allan [00:34:20]
And Aira has a different pricing model to make heat pumps more accessible. Can you explain that?
Daniel Särefjord [00:34:20]
Yes, we offer financing options so customers can pay a monthly fee instead of an upfront cost. This model makes it more affordable for people who might not have the capital for a heat pump.
Liz Allan [00:42:20]*
Your heat pumps come with a 15-year warranty. Does that apply even after the customer has finished paying?
Daniel Särefjord [00:42:33]
Absolutely. The 15-year warranty covers the heat pump for the entire period, and even if the homeowner moves, the new resident benefits from it.
Liz Allan [00:55:50]
What would you like to see happen in terms of policy or incentives to boost heat pump adoption?
Daniel Särefjord [00:56:30]
First, there needs to be long-term commitment to funding green transitions. Second, we need to remove administrative barriers like planning permissions. Third, the cost of electricity needs to be more competitive compared to gas.
Liz Allan [01:02:15]
If you had a magic wand, what would you like to see happen right now?
Daniel Särefjord [01:02:15]
I'd want an even playing field on the taxation of energy to make electrification more affordable and planning permissions streamlined to remove red tape.
Liz Allan [01:05:37]
That’s a great point. Daniel, thank you so much for enlightening us today. It's been a fantastic conversation.
Daniel Särefjord [01:06:16]
Thanks for having me, Liz.
Liz Allan [01:07:16]
Thank you, everyone, for listening and watching. If you enjoyed this episode, please like, subscribe, and share to spread the word. Goodbye, and see you next time!