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Administration report

General operational information

Azelio was founded in 2008 and has a head office in Gothenburg, development in Gothenburg and Åmål, production in Uddevalla and international offices in Spain, Morocco and China. Azelio offers a system of Stirling engine-based electricity production with thermal energy storage, as part of a micro grid or as an off-grid solution. The system will initially be aimed at customers around the sun belt with installations of between 0.1 MW and 20 MW, and in the next stage up to 100 MW. The system was developed for distributed electricity production with storage of thermal energy, i.e. heat, in an aluminium alloy where heat can be retrieved at any time from storage and converted into electricity 24 hours a day. The technology is highly suitable for areas that currently lack access to a power grid or have no reliable grid, but that are in need of a reliable and continuous electricity supply. There are no sustainable and cost-effective solutions in the global energy market today for the segment of small to medium-sized distributed installations that offer long storage periods.

The Company’s initial target market is the MENA region (Middle East and North Africa). Azelio has been active in the region for several years and has established strategic partnerships with leading actors in research, development and business development. The Company’s experienced partners include the Moroccan Agency for Sustainable Energy (Masen) in Morocco and the Masdar Institute of Science and Technology (Masdar) in Abu Dhabi.

The board of Azelio AB

The Board consists of nine ordinary members, one new member was added at the annual general meeting in June and one member was added at an extraordinary general meeting in November. In addition, a previous employee representative was replaced by another employee in May. The ordinary members are Bo Dankis (chairman), Bertil Villard, Pär Nuder, Kent Janér, Mattias Bergman, Christopher Beaufait, Hicham Bouzekri (from the annual general meeting and onwards), Lars Thunell (from the extraordinary general meeting and onwards), Gustav Bos (employee representative ahead to May) and Teo Jörlén (employee representative from May onwards). In 2018, the Board held 21 Board meetings.

Largest shareholders with holdings of over 10%

Blue Marlin AB / Kent Janér22 %

The technology is well suited for areas that today do not have access to a power line or do not have a reliable power line

Development of the company's operations, results and position

Net sales1,941,6012,920,5863,665,3356,781,059
Profit/loss for the year-91,845,266-97,443,281-107,740,029-91,131,598
Balance sheet total645,644,008286,793,967230,996,952199,684,153
Equity/assets ratio %87%83%57%77%
Definitions: see note 32
Net sales1,941,6012,920,5863,665,3356,781,059
Profit/loss for the year-96,092,507-94,230,036-105,115,588-92,178,732
Balance sheet total644,294,285289,824,326236,902,364202,585,399
Equity/assets ratio %88%85%58%78%
Definitions: see note 32

Significant events during the financial year

Expanded partnership with Masen

At the beginning of 2018, Azelio (then called Cleanergy) signed an intensified partnership agreement with Masen (the Moroccan Agency for Sustainable Energy) involving product development, verification and commercialisation.

Heavily oversubscribed private placement and name change

In June Azelio completed a heavily oversubscribed private placement worth SEK 105 million. The Company also changed its name from Cleanergy to Azelio to strengthen its unique position in the global market where several companies already exist with “clean energy” or very similar wording in their name.

Demonstration of storage solution

At the end of June Azelio held a public demonstration of its storage solution at the Company’s development facility in Åmål, with very good results. The demonstration event was well attended by both current shareholders and the media. Following the demonstration in June, enquiries about Azelio’s unique solution have been received from a total of 52 countries with 110 projects for a potential order value of SEK 50 billion.

In order to handle the enquiries and advance the business, Azelio has hired Dr. Ralf Wiesenberg as VP Business Development. With 22 years in the energy industry and 10 years in concentrated solar power and thermal storage, Ralf brings extensive experience to support Azelio’s global advance and commercial development.

Listing on Nasdaq First North

On 10 December Azelio was listed on Nasdaq First North, despite a period of substantial uncertainty in the stock market. The share issue in connection with the listing injected SEK 242 million into the Company before issue costs. The listing also brought around 2,200 new shareholders into the Company, including a number of strong and long-term institutional investors.

Expected future development

The macroeconomic situation continues to develop towards a more sustainable future with increasingly competitive sustainable alternatives and limited fossil alternatives. An alarming IPCC report came out in the second half of 2018. It stressed the need for a fast transition from fossil to renewable energy sources. Access to electricity as a necessity for societal development was confirmed by the International Energy Agency (IEA) when it quantified the investment requirement for universal access to electricity by 2030. The investment requirement is USD 391 billion, which includes a substantial investment in micro grid and off-grid solutions. Existing distributed solutions involve various types of sustainable intermittent installations, such as solar panels and wind power, but require a reliable source of baseload power. This baseload power is currently provided by diesel generators. To make these distributed grids sustainable, long-term storage and cost-efficient electricity production are required. This is the solution that Azelio is offering – sustainable distributed baseload power.

Azelio’s next steps towards market launch with first commercial installation 2020

Significant risks and uncertainties

The current valuation of the Company’s assets in the form of capitalised development costs and inventory is based on adherence to the prepared business plan. The Board expects the future sales volumes to be so extensive that the discounted cash flows generated will justify the current valuation with a good margin. The Board believes there is good potential to implement the business plan and that capitalised development costs are likely to lead to future economic benefits. The Company’s capitalised development costs relate to various technologies. All of them are, however, linked to the Stirling engine and the energy storage, the technologies upon which the Company has built its business. The Board believes that, due to technical synergies, the current solar engine was made possible by the development of gas engine technology. Due to the close relationship between these technical solutions, the machines are not assigned to separate cash-generating units. The engine is a further development of earlier technology and thus no impairment losses have been reported on development costs for earlier versions. On the other hand, inventory disposals have been made for components that were unique to previous versions of the product.

Following authorisation by the general meeting, the Board of Directors completed a new share issue in conjunction with listing on Nasdaq First North on 10 December 2018. The listing provided the Company with proceeds of SEK 242 million before transaction costs. The Board is of the opinion that the share issue secures the capital requirement based on the established business and liquidity plans for a period of 12 months from the date of listing. The Board plans a new share issue at earliest summer 2019 for financing the Company’s commercialisation, including production facilities. The Board’s perception is that there is a great interest in the company's technology among investors, including those that are not shareholders in Azelio today, and that the Company has a strong ownership structure. The potential for implementing future comprehensive financing plans is therefore considered to be good.

The "going concern" accounting principle according to the Swedish Annual Accounts Act prescribes a basic assumption regarding the valuation of a company’s assets. With respect to capitalised development, there are further assumptions regarding necessary financing of continued development as well as commercial realisation. Thus, a valuation not made on the basis on these assumptions would result in different valuation of the Company’s assets. The Board is in favour of the assumptions described above and considers that the necessary conditions are in place. The Board is aware that uncertainties exist when estimating the time and costs involved in implementing full-scale commercialisation and industrialisation of the Company’s product. This has been taken into account in the Company’s plans and forecasts, by the Board actively exploring alternative scenarios and being prepared to handle these types of challenges. This includes various financing solutions and having flexible development plans. Thus, the company's survival is not expected to be threatened in 2019.

Research and development

Research and development are a core aspect of Azelio’s operations and the Stirling engine is the foundation of the Company’s system. The Stirling engine is already developed for commercial use, while the subsystem for thermal energy storage has been proven viable in emonstration facilities but has not yet been applied commercially.

Azelio’s research and development take place in Åmål and Gothenburg. Development of the Stirling engine and software takes place in Åmål, along with testing of both subsystems and the whole system in the Company’s testing facilities and solar lab. Development of thermal energy storage and solar concentrators takes place in both Åmål and Gothenburg. Most of the development takes place internally, with external partners to assist with development or improvement of specific components.

Azelio’s current development work is mainly focused on three subsystems:

THE STIRLING ENGINE: efficiency optimisation of the Stirling engine for adaptation to thermal energy storage. Further increase efficiency and reduce manufacturing costs.

THERMAL SOLAR POWER: further develop solar concentrators adapted for the Company’s system.

THERMAL ENERGY STORAGE: develop design from prototype level to production level.

Azelio has a number of pilot and research installations around the world. A total of 172 Stirling engines have been put into operation by Azelio since 2012, in the United Arab Emirates, Morocco, China, Spain, Portugal and Sweden. Not all are in operation today, but they have contributed to the development of today’s products.

Market and customers

Azelio’s initial target market consists of regions in and around the sun belt, with end-users who have no access to an electricity grid or have an unreliable connection and are forced to use costly local electricity production via diesel generators for a continuous supply of electricity. These include communities, factories, hospitals, industrial parks etc. Azelio can offer a cost-effective and sustainable solution for local electricity production around the clock as part of a micro grid or an off-grid system. This is a strong driver for replacement of diesel generators with Azelio’s system. Below are illustrative examples involving a power grid operator and an industrial actor.

Azelio can offer a cost-effective and sustainable solution for local electricity production around the clock

Customer example – power grid operator with a small local grid

  • The customer is an energy company that operates a small local electricity grid and sells electricity to the local community and industries
  • Azelio offers the customer a cost-effective and environmentally sound solution for local electricity production around the clock
  • By switching from a diesel generator to Azelio’s system the customer can increase cash flow by more than EUR 6 million a year and repay the investment after five years
Annual production (5MW plant with 78% capacity) 33,960 MWh33,960 MWh
Income (256 EUR/MWh electricity price)8,693,835 EUR8,693,835EUR
Production cost (excluding fuel costs)878,166 EUR734,000 EUR
Fuel cost (Diesel, 0,92 EUR/liter)7,804,468 EUR-
Interest cost (60% loan financing at 6% interest)198,000 EUR1,222,488 EUR
Cash flow-186,799 EUR6,737,347 EUR
Investment/ MW1,100,000 EUR6,791,600 EUR
Total project investment5,500,000 EUR33,958,000 EUR
Duration repayment-5 år

Customer example – industrial actor self-sufficient in electricity

  • The customer is an industrial actor that produces electricity for its own use
  • Azelio offers the customer a cost-effective and environmentally sound solution for local electricity production around the clock
  • By switching from a diesel generator to Azelio’s system the customer can achieve cost savings of more than EUR 5 million a year
Annual production (5MW plant with 78% capacity)  33 960 MWh 33 960 MWh33,960 MW33,960 MW
Total electricity cost8,693,835 EUR3,646,317 EUR
Total cost saving-5,047,518 EUR


A systematic approach to work environment must be a natural part of our business in order to achieve efficiency and quality. For us at Azelio, this means that we actively work to minimize the risks of occupational injuries, accidents and incidents. We make sure to work with activities that promote employees' health, job satisfaction and efficiency. One step in this is ongoing work with our processes, which aims to improve employees' everyday work in order to be able to focus on the right tasks. All emplyee managers are trained in the areas of work environment and psychosocial work environment (AFS 2015:4). We continuously review the need for education related to work environment.

Legislation and party agreements are minimum requirements. It is in Azelio's interest to maintain higher standards than this. We see it as a profitable investment for the future where high work motivation and low sick leave are the direct benefits. We have signed a healthcare insurance for our employees with access to fast support and specialist care. Azelio is affiliated with Teknikföretagen and has collective agreements with the Union, Ledarna, Sveriges Ingenjörer and IF Metall.

Azelio should be an attractive and developing workplace for both women and men, working to ensure that all work teams consist of both women and men. The wage survey in 2018 regarding comparisons of work that is to be considered as equal or equivalent did not show any unreasonable wage differences between women and men. As an employer, we will pursue a goal-oriented work to promote gender equality and diversity. This means that we must prevent and counteract discrimination, safeguard everyone's competence and respect differences irrespective of gender, age, ethnic or cultural background, religion or other belief, disability, gender-crossing identity or sexual orientation.

We evaluate all our suppliers according to the Azelio Ethics standard.


Our ability to attract and retain employees is a strong competitive advantage as the talent shortage is one of the greatest challenges for the Company’s success and growth. In 2018 Azelio recruited several individuals with core competencies for the Company – a very important step to help us reach the targets in our business plan. From 61 employees in June 2018, Azelio had around 80 as of 31 December 2018, and also added around 20 full-time consultants.

Azelio takes active steps to prevent discrimination and harassment and to promote greater gender equality. The Company continues to endeavour to achieve a good balance in terms of age, gender and ethnicity. Of the 21 employees who joined the Company in 2018, six are women and a further five women will join the Company in the first quarter of 2019, which is an increase of 55%.

Group key figures

JAN–DEC 2018
JAN–DEC 2017
Net sales, SEK 0001,9422,921
Operating profit/loss, SEK 000-91,959-95,645
Profit/loss for the year, SEK 000-91,845-97,443
Earnings per share, SEK-0.77-0.77
Equity, SEK 000561,876237,146
Equity/assets ratio, %87%83%
Cash flow from operating activities, SEK 000-36,015-83,876


Azelio’s goal is to provide renewable electricity at a low cost through energy storage and distribution on demand. The Company intends to offer the most cost-effective alternative for controllable and distributed electricity production, and to contribute to progress towards renewable energy making up a majority of the future global energy mix. 

To achieve the above goal, the Company has established the following targets for each year from 2019 to 2021.

  • Agreements signed with partners/coordinators in prioritised markets
  • Installation and launch of verification project in Morocco
  • Verification data presented from the verification project in Morocco
  • First commercial orders for a small-scale project
  • Installation and launch of verification project for production
  • Verification data presented from the verification project for production
  • Volume production initiated
  • Installation and launch of the first commercial project
  • Production capacity of 5,000 systems per year and shift

Production targets

Azelio has the following targets for annual production of Stirling engines:

2021: 1 500 units
2022: 6 000 units
2023: 17 000 units
2024: 35 000 units

Permit or notification required by the Environmental Code


No operations requiring permit or notification according to the Environmental Code have been conducted during the financial year.


No operations requiring permit or notification according to the Environmental Code have been conducted during the financial year.