Creating Value at Abengoa through Innovation

Abengoa’s overarching goal, sustainable development, is achievable only through innovation. Hence Abengoa has become a leader in creating new technologies, processes and know-how designed to provide innovative solutions that help preserve the environment, create value over the long term and provide a competitive edge. Technological innovation is the key factor in evolving towards a sustainable world in which people and societies can enjoy a high standard of living. Experts agree that close to 80 % of an economy’s long-term growth comes down to technological achievement.

Investment in research and development makes technology the foundation of Abengoa’s sustainable growth and plays a central role in its strategic objectives. Research and development is managed on business lines – result-oriented and closely aligned with strategy.

In 2009, Abengoa’s investment in R&D amounted to €89.7 M, 7 % up on the previous year and equivalent to about 2.2 % of its total sales. R&D investment has grown at an annual average of 8 % over the past few years. This figure does not include investment in innovation, which, though not readily quantifiable, is a key element of Abengoa’s strategy.

The table below shows how Abengoa’s investment in R&D has evolved over the past few years in each distinct sector.

graf 2

Innovation is a dynamic process that moves in step with an evolving society. It avails itself of all the resources offered by the knowledge, science and technology communities. In line with its calling as a leading company, Abengoa has adopted the “innovation ecosystem” approach: It works in partnership with universities, government agencies, public research institutes, technology centers and other private enterprises to support the creation of knowledge networks, with Abengoa as the driving force. It is through innovation alone that Abengoa is able to bring into being the necessary knowledge and provide responses and solutions to new challenges. The system of innovation embraces demonstration projects, research and development facilities in various countries and external suppliers. In 2009, two framework collaboration agreements were signed with the University of Seville. One concerned joint training for doctoral students while the other supported co-operation between the University and Abengoa.

Innovation management at Abengoa is a central part of the strategy implemented by each subsidiary or Business Unit. Innovation is regarded as having three aspects: new products, new processes and improvements to existing assets. Research and development programs are given a general scope, and each is linked to a given line of development.

Research and development programs take a long-term view (up to 30 years) and are undertaken as phased programs (each covering a ten-year period) and as specific projects (3-4 years). It is these specific projects that put Abengoa’s innovation effort into practice.

graf 3

At Abengoa, most research and development investment goes towards applied research and the development of technological innovation towards the achievement of strategic sustainability goals and new products.

g4