Smart grid continues to be in news

The “smart grid” has become the buzz of the electric power industry, at the White House and among members of Congress, according to a report filed by AP.

A company like Cisco believes that the smart-grid infrastructure market size could be worth more than $20 billion a year for the next five years.

“It’s the marriage of information technology and automation technology with the existing electricity network. This is the energy Internet,” reportedly said Bob Gilligan, vice president for transmission at GE Energy.

The Obama Administration has recently announced a new solicitation for around $4 billion in stimulus, funding for new power- transmission technology.

As part of the American Recovery and Reinvestment Act, there are plans to distribute more than $3.3 billion in smart grid technology development grants and an additional $615 million for smart grid storage, monitoring and technology viability.

According to Max Schulz, a senior fellow at the Manhattan Institute, the irony in the stimulus package’s approach to grid investment is that private industry has long made clear its willingness to spend its own money to fix the grid, as long as Washington allows utilities and transmission companies to do it the right way.

“What the industry actually needs from Washington to fix the grid isn't money, but leadership,” he wrote recently. “That leadership can’t come soon enough. Even with robust energy-efficiency and conservation measures, the U.S. economy will require 30% more electricity by 2030.”

$4 billion marked for smart power grid

The Obama Administration has recently announced a new solicitation for around $4 billion in stimulus, funding for new power- transmission technology.

As part of the American Recovery and Reinvestment Act, there are plans to distribute more than $3.3 billion in smart grid technology development grants and an additional $615 million for smart grid storage, monitoring and technology viability.

“A smart electricity grid will revolutionise the way we use energy, but we need standards in place to ensure that all this new technology is compatible and operating at the highest cyber security standards to protect the smart grid from hackers and natural disasters,” Commerce Secretary Gary Locke said.

The Recovery Act will fund the development of those standards, added Locke.

DOE’s Smart Grid Investment Grant Programme will provide grants ranging from $500,000 to $20 million for smart grid technology deployments. It will also provide grants of $100,000 to $5 million for the deployment of grid monitoring devices.

The draft Funding Opportunity Announcement is for smart grid demonstrations in three areas:

· Smart grid regional demonstrations will quantify smart grid costs and benefits, verify technology viability, and examine new business models.

· Utility-scale energy storage demonstrations can include technologies such as advanced battery systems, ultra-capacitors, flywheels, and compressed air energy systems, and applications such as wind and photovoltaic integration and grid congestion relief.

· Grid monitoring demonstrations will support the installation and networking of multiple high-resolution, time-synchronised grid monitoring devices, called phasor measurement units, that allow transmission system operators to see, and therefore influence, electric flows in real-time.

Each demonstration project must be carried out in collaboration with the electric utility that owns the grid facilities.

CPower raises $10m

Energy management firm CPower has closed its Series B round of financing, indicating that VCs are interested in technology that makes energy grid more intelligent.

This $10.68 million investment was led by a new investor in the company, Mayfield Fund, as well as returning investors, including Bessemer Venture Partners, Expansion Capital Partners, Schneider Electric Ventures, New York City Investment Fund and Consensus Business Group.

The proceeds will be used to accelerate business growth in new geographies and vertical markets, and to continue the development of its turnkey energy management solutions.

The company offers a range of energy management programmes including demand response capacity, reserves and regulation, energy efficiency, peak load management and white certificates.

CPower had bagged $17 million in its Series A funding in 2007.

In another development, CPower has been chosen to support plastics manufacturer Spartech Corporation’s energy conservation programme. The company will use CPower’s energy management demand response solution to reduce electric energy consumption at various facilities in North America.

Spartech has committed to curtail up to 10 megawatts of electricity capacity upon request by the regional transmission organisations responsible for calling demand response events when the grid is under stress. CPower will help manage this process at approximately 10 facilities throughout the U. S.

BPA seeks additional smart grid partners

The Bonneville Power Administration (BPA) has issued its second request for potential partners for smart grid projects that could qualify for federal stimulus money.

The Portland-based non-profit federal electric utility is hoping to tap into some of the $4.5 billion to be allocated from the American Recovery & Reinvestment Act for smart grid technologies.

Even though the Department of Energy (DOE) announcement is still in draft form, BPA is moving forward with the request as a proactive step to help bring a Smart Grid project to the region.

“Collaboration is key for this project,” said BPA’s VP of energy efficiency, Mike Weedall. “We are working to finalise which utilities will participate in a proposal to DOE, and now we need to get other types of partners on board.”

The utility is looking for manufacturers, hi-tech companies and other stakeholders to commit to capital investments and matching fund contributions. In 2006, BPA partnered with DOE’s Pacific Northwest National Laboratory to advance the technology through the Olympic Peninsula GridWise Demonstration project.

BPA markets more than a third of the electricity consumed in the Pacific Northwest. It operates a high-voltage transmission grid comprising more than 15,000 miles of lines and associated substations in Washington, Oregon, Idaho and Montana.

Cisco gears up for smart grid market

Cisco Systems Inc. sees a $100 billion opportunity in communications equipment for upgrading aging electrical infrastructure to a digital smart grid.

Marie Hattar, vice president of marketing in Cisco’s Network Systems Solutions group, told CNET that the smart grid network will be “100 or 1,000 times larger than the Internet,” saying that virtually every home has electricity and many of them don’t have Internet access.

Cisco believes the smart-grid infrastructure market size could be worth more than $20 billion a year for the next five years, although some have called the projection overly optimistic.

“The opportunity is real,” reportedly said Judy Lin, the general manager of Cisco’s ethernet switching technology group. “Smart-grid is one of the top priorities and key market adjacencies for Cisco.”

Cisco’s Smart Grid solutions will address critical points within the energy infrastructure: from data centres and substations, through neighborhood-area networks, to businesses and homes.

The company will provide solutions for efficient, IP-based backhaul communications for smart metres that will integrate proprietary solutions into the overall smart grid platform. Cisco’s Home Energy Management and Business Energy Management solutions will help optimise energy demand, use and cost by providing greater access to data and analysis tools.

Last month, Cisco announced its partnership with the city of Miami to launch a $200 million Energy Smart Miami project. That initiative will bring smart metres and solar power systems to the city, as well as adding plug-in hybrids to the city’s vehicle fleet, and encourage the adoption of energy-reduction tools like home energy use dashboards, smart appliances and smart-metre thermostats to pilot programmes in 1,000 city homes.

EnerNOC secures over $100m of potential revenue

EnerNOC has secured over $100 million of future potential revenue in the PJM Interconnection (PJM) market as a result of the 2012-13 Reliability Pricing Model Base Residual Auction (BRA).

This future potential revenue is for demand response capacity to be delivered from June 1, 2012 through May 31, 2013.

According to EnerNOC, between its new and existing resources, EnerNOC captured 35% of the total quantity of demand response capacity that cleared in the BRA.

With the exception of the capacity that EnerNOC will deliver to Allegheny Power under a previously announced contract, all of EnerNOC’s new capacity in the BRA cleared in higher-priced, constrained regions.

After the first quarter of 2009, the company increased megawatts under management by approximately 300, a significant amount of which resulted from sales efforts in the PJM Interconnection region, bringing the company’s total megawatts under management as of the date of this release to over 3,000 across more than 5,000 customer sites.

In the first quarter, the company signed seven new long term utility contracts, three in new States for the company, Arizona, Colorado, and Idaho. And it captured more than 60% of a competitive RFP opportunity with four investors on utilities in Maryland. In aggregate, EnerNOC expects this long term utility contract wins to represent over $120 million in combined potential revenue to EnerNOC.

US smart meter projects on track: Itron

The company continues to work on its deployments for major utilities in the US.

Itron Inc has said that the economic recession has not affected deployment of the company’s $1.4 billion in smart meter contracts with four major U.S. utilities.

According to a report filed by Reuters, Itron chief executive Malcolm Unsworth said projects with Sempra Energy’s San Diego Gas & Electric, CenterPoint Energy Inc and Edison International’s Southern California Edison “are all on plan according to what they originally proposed”.

Itron has a fourth contract with DTE Energy unit Detroit Edison which is expected to begin in 2010.

The company also continues to improve its offerings in this sector. Recently, Itron signed a joint marketing agreement with Verizon Wireless for development of secure, two-way communications that support utilities’ access to energy usage data and advance their smart grid projects.

Operating on Verizon Wireless’ network, the Itron OpenWay Cell Relay now allows utilities to more quickly collect, measure and manage energy data, while providing a supply of power without having to build and operate proprietary communications networks.

EnergyAustralia signs a deal with IBM

EnergyAustralia says the project, a part of its initial investment of $170 million in its smart network roll-out, will help it stay at the forefront of the global intelligent network transformation.

EnergyAustralia has signed an agreement with IBM for the implementation of an energy network monitoring and control solution.

A key project within EnergyAustralia’s overall intelligent network programme, the Distribution Monitoring and Control (DM&C) project involves the roll-out of 12,000 sensing devices throughout the electricity distribution network, creating a smart grid.

As per the agreement, IBM will design and build the system IT architecture to support the project, in which sensing devices will connect with EnergyAustralia’s operational systems using a combination of fourth generation and existing technologies.

According to IBM, this network will carry the necessary data for EnergyAustralia to reduce outages through faster fault location and preventative maintenance and, to work towards managing distributed energy sources such as solar and storage devices.

Ember secures $8 million in funding

The company now has raised $89 million in total.

Ember Corporation has closed an additional $8 million in funding from its primary venture capital investors and strategic partners.

Polaris Venture Partners, GrandBanks Capital, RRE Ventures, Vulcan Capital, DFJ ePlanet Ventures, New Atlantic Ventures, WestLB Mellon Asset Management and strategic partners such as Chevron Technology Ventures and Stata Venture Partners participated in the latest round of funding.

Smart meters now being equipped with ZigBee-standard Ember radio chips and protocol software are serving as energy management gateways between utilities and consumers, said Ember chairman and Polaris Partner Bob Metcalfe.

The company, referring to projections from research firm, In-Stat, mentioned that the market for 802.15.4/ZigBee devices is expected to reach as high as 292 million units in 2012, up from about seven million units in 2007.

The company also announced the expansion of its sales channels with the addition of new distributors in Australia, New Zealand, India and Hong Kong, People's Republic of China which are emerging as key markets for ZigBee-enabled smart meters.

EnergyHub closes Series A financing

The company is now focusing on its product development as well as the implementation of pilot programmes in the US.

EnergyHub, a home energy management solutions provider, has closed a Series A round co-led by .406 Ventures and Physic Ventures. Terms of the investment were not disclosed.

The company will use the proceeds from this financing to support continued product development and to implement pilot programmes with utilities across the US.

According to .406 Ventures, EnergyHub is providing “a much needed two-pronged approach to decreasing per capita consumption”. The company offers consumers control of their energy use while enabling utilities to better manage their territories.

EnergyHub’s solution, which integrates in-home devices, stand-alone displays, and web-based software, gives consumers real-time information and control over their energy usage. Consumers can access data and control their home from the Internet or a mobile device.

FERC steps up smart grid development

The Federal Energy Regulatory Commission (FERC) has come with a proposed policy statement and action plan that would help set the “rules of the road” of a modern grid.

The proposed policy statement seeks public comment on standards for four priority issues critical to the smooth functioning and operation of the Smart Grid.

After weighing public comments, FERC plans to adopt a final policy statement providing guidance to the electric power industry on standards for:
· Cyber security;
· Communications among regional market operators, utilities, service providers and consumers;
· Ensuring that the bulk power system operators have “wide-area situational awareness” with equipment that allows them to monitor and operate their systems; and
· Coordinating operation of the bulk power system with new and emerging technologies for renewable resources, demand resources, electricity storage and electric transportation systems.

Prioritising the development of key standards will speed up the process of achieving an interoperable smart grid, said Commissioner Suedeen Kelly. Kelly said the proposed policy will require the sharing of information associated with smart grid deployments with the Smart Grid Clearinghouse being developed by the Department of Energy. “This will help to demonstrate the real benefits that investing in a smart grid can bring to the public,” said Kelly.

As per the plan, smart grid advancements will apply digital technologies to the grid, and enable real-time coordination of information from both generating plants and demand-side resources.

Related links: FERC

Smart grid industry should adopt Security Development Lifecycle: study

A study has highlighted that smart grid technology is susceptible to common security vulnerabilities such as protocol tampering, buffer overflows, persistent, and non-persistent rootkits, and code propagation.

These vulnerabilities, according to IOActive, a provider of application and smart grid security services, could result in attacks to the smart grid platform, causing utilities to lose momentary system control of their advanced metering infrastructure (AMI) smart meter devices to unauthorised third parties. This would expose utility companies to possible fraud, extortion attempts, lawsuits or wide spread system interruption.

Joshua Pennell, president and CEO, IOActive, recommended that the smart grid industry should follow a proven formal Security Development Lifecycle, as exemplified by Microsoft’s Trustworthy Computing initiative of 2001, to guide and govern the future development of smart grid technologies.

IOActive, which verified significant security issues within multiple smart grid platforms, emphasised that if security is not addressed in the design and implementation of these emerging technologies, it may prove cost prohibitive to address them once the devices are fully deployed in the field.

In terms of deployments, it shared that over two million smart meters are being used currently in the US and it is estimated that the more than 73 participating utilities have ordered 17 million additional smart meter devices.

Related links: Security, Utilities, Advanced Metering Infrastructure, Smart Meters

“Smart metering will revolutionise energy management and grid reliability”

The US industry has welcomed the signing into law of the American Recovery and Reinvestment Act and its ambitious provisions to modernise the U.S. electricity grid.

The American Recovery and Reinvestment Act contains specific provisions for the establishment of a $4.2 billion grant programme that will support the rollout of smart grid and smart metering projects across the country. Smart metering solutions provide utilities with a two-way flow of data required to manage energy use, efficiency, demand response and network protection. Consumers benefit from improved usage information and with it, the ability to reduce overall energy costs and carbon footprints.

Terming the development as a “huge victory for forward-looking utilities and consumers”, Richard Mora, CEO of Landis+Gyr North America said, “National demand for electricity is growing three times faster than power resources are being added, making energy conservation critical. The federal government has now joined in the drive to build a smart and dynamic grid infrastructure.”

“Make no mistake, smart metering will revolutionise energy management and grid reliability across the country,” Mora said.

Landis+Gyr pointd out that the potential benefits are enormous. A recent Brattle Group study found that just a five percent drop in peak demand nationally would eliminate the need for installing and running some 625 infrequently used peaking power plants, translating into annual savings of approximately $3 billion. The Department of Energy recently estimated that if the US grid were just five percent more efficient, it would be the equivalent of eliminating the fuel and greenhouse gas emissions of 53 million cars.

RESA calls for freedom to choose retail electric supplier

The Retail Energy Supply Association (RESA) has testified before the Connecticut General Assembly to oppose three bills that combined will eliminate a customer’s right to choose their energy supplier.

The Association also mentioned that the bills would also establish an electric procurement structure that will shift cost responsibility from private investors to Connecticut ratepayers.

Specifically, RESA members testified in opposition to: (1) H.B. 6507, which would repeal customer choice for Connecticut residential and business customers with maximum demands below 500 kilowatts effective January 1, 2010; (2) H.B. 6510, which would establish a state power authority; and (3) H.B. 6512, which would replace the customer choice structure repealed by H.B. 6507 with a "managed portfolio" electric procurement structure heavily dependent on ratepayer-backed medium-term and long-term contracts.

Describing the adoption of some of the bills as a backward step for Connecticut energy customers, Jay Kooper, President of RESA, said, “What’s more detrimental is the plan to replace the current structure with a failed one-size-fits-all electric procurement structure that, in the past, has exposed Connecticut ratepayers to billions of dollars in stranded costs stemming from utility investment decisions that have done little to contain costs or improve electric system reliability.”

EnerNOC posts $106.1m in revenues in 2008

EnerNOC, Inc. ended 2008 with $106.1 million in revenues. This represents a 74 percent year-over-year growth.

The company’s network delivered over 100 percent performance on average based on nominated versus delivered capacity in more than 100 demand response events, according to its CEO, Chairman, and Co-Founder, Tim Healy.

“Our attractive applications in combination with our stable grid operator and utility customer base and our own financial strength and visibility give us confidence in the following 2009 corporate objectives,” said Healy, who added that the company expects its revenues to grow approximately 55 percent over 2008 to a range of $155 to $170 million.

Through the first seven weeks of 2009, the company has signed two new utility contracts in Arizona and Colorado worth over $35 million in combined potential revenue. It has added over 500 new megawatts under management to its demand response network, and has also developed an MBCx pipeline that is stronger than its internal projections for this point in time.

EnerNOC recently entered into an eight-year contract with Public Service Company of Colorado, an Xcel Energy company, to provide up to 44 megawatts of demand response capacity. The company highlighted that states like Colorado and Nevada are at the forefront of developing market dynamics that allow utilities to benefit financially from increased investments in demand response and energy efficiency.

Bright future ahead of smart grid technology

In its global predictions for technology industry, Deloitte has stated that smart grid solutions providers enjoyed 50 percent revenue growth in 2008 and may generate $25 billion in revenues in 2009.

Although the global economy may make public spending on smart grid unlikely, governments may choose to offer tax incentives as well as consider how smart grid technology can reduce non-domestic energy dependence and help make the grid more secure.

According to Deloitte, to conserve costs, profit-oriented utilities and enterprises may deploy smart grid technologies even without government support.

Also, major manufacturers and utilities may even want to explore partnerships with or acquisition of smart energy companies.

"Smart grid technology will represent the biggest and fastest growing sector in green tech," said Eric Openshaw, vice chairman and U.S. technology leader for Deloitte LLP.
"The most significant emerging technologies will be those that deliver cost-efficiency, contribute to environmental sustainability and drive new forms of personal and business collaboration."

Irish utility calls for "Prudent" approach towards investment for smart meters

Irish electric utility ESB has reportedly said that it did not know if the Government's €1 billion smart metering proposals would lead to the desired level of savings.

Underlining that the installation of smart meters in every home in the country has been a policy cornerstone of Minister for Energy Eamon Ryan since he took up office last year, irishtimes.com mentioned that the process is now being explored by the ESB. According to the report, senior executives of the ESB indicated publicly for the first time that the "technology was not yet fully proven and that the case had not yet been made that such a substantial investment would result in commensurate savings".

ESB chief executive Padraig McManus said that the utility needed to take a prudent approach before making such a huge investment. That is why smart meters were being piloted over 18 months.

It was in September this year when the Minister had launched the National Smart Meter plan. Over 60,000 ESB customers were to receive a letter inviting them to take part in the first phase of the national roll-out of smart meters. Up to 21,000 customers were to get a smart meter installed in their home for free in order to participate in a behavioural and technology trial to inform the national rollout. The Commission for Energy Regulation (CER) has been charged with leading the implementation of the project

Silver Spring reportedly on a contract signing spree

Silver Spring Networks, a firm which recently received $75 million investment for its global expansion, is reportedly finalising contracts "worth hundreds of millions of dollars to outfit three large, yet-unnamed electric utilities with smart grid technology in deal".

The multi-year deals include wirelessly networking more than three million electric meters for the utilities.

The agreements are expected to be finalised in December and would be worth more than $300 million, Silver Spring executives told Red Herring.

"The Silver Spring agreements, which are with two investor-owned utilities in the United States and one abroad, would cap a big year for the Kleiner Perkins-backed company," as per the report.

It was Kleiner Perkins Caufield & Byers's Green Growth Fund, which had led a $75 million investment round into Silver Spring Networks in October. The company provides its Smart Grid technology, systems, and services to customers including: Florida Power & Light Company, Pacific Gas and Electric Company, Modesto Irrigation District, Oklahoma Gas & Electric, Consumers Energy, and others.

Chief executive Scott Lang said Silver Spring has already inked multi-year contracts worth $500 million, and he expects that value to reach $1 billion within 12 months. He said the company would be profitable by next year, pulling in revenue exceeding $75 million.

IBM and EDF embark on an energy sustainability project

IBM has signed a collaboration with EDF to jointly develop high performance computing solutions which can significantly advance the operation and optimisation of the complex systems and processes involved in electricity production and power management.

The two companies will also work on a project to explore key aspects of the energy systems that are important in EDF operations, in an effort to further energy sustainability.

Acknowledging the significance of extensive collaboration between the scientific and business communities, and new approaches in technology, John E. Kelly III, senior vice president and director of IBM Research said this ambitious initiative will explore how to apply technologies with new intelligence to seek significant improvements in energy efficiency and alternative energy.

Together, the companies will develop and validate sophisticated computational solutions to model a number of complex processes critical to EDF activities. EDF expects that this common initiative will increase its ability to further advance the efficiency of its power plants.

IBM expects that its work with EDF will help advance IBM's systems, software, middleware and applications capabilities in its Power Generation, Intelligent Utility Network and Advanced Water Management solutions, as well as many other industrial, environmental and research activities and lead to improved computer systems and applications designs in the future.

For its part, EDF has been investing in research and numerical simulation to support efficient and sustainable use of power production. Its R&D teams have developed a set of highly validated numerical codes and simulation platforms that play a key role in optimising plant operation.

EnerNOC set to achieve its 2008 targets

EnerNOC says its on target to end this year with over 2,000 megawatts under management and it has dispatched the liability based capacity in its demand response network over 90 distinct times year-to-date and delivered an average performance of 98 percent based on nominated versus delivered capacity across all reporting events.

Sharing its third quarter results, in which EnerNoc posted record revenue performance of $44.2 million, 131 percent increase overall revenue in the third quarter of 2007, the company stated that this performance track record demonstrates the scalability and robustness of its network operation center and its fifth generation proprietary software application called Power Track, which is the primary application that it uses in EnerNOC for notifying, monitoring, and managing its expanding network of active customers' sites.

It uses this application for both demand response and its growing energy efficiency business.

On the performance during the quarter, Tim Healy - chairman and CEO, EnerNOC Inc., said, "This year-over-year growth was the result of many things including the significant expansion of our presence in the PJM market and our continued strong performance in New England as well as the growth and diversification of our portfolio demand response and energy management solutions throughout North America."

The company grew its demand response network ending September with over 1,760 megawatts under management, which is the capacity equivalence over 17 average size peaking power plant.

"These megawatts come from 3,400 different end-use customer sites in our network as of September 30, 2008 up from 3,067 customers' sites in our network as of the end of the second quarter," stated the company. "We have sold approximately 100 new megawatts since the end of the third quarter, with over 1,850 megawatts in our network we feel good about our ability to exit 2008 with over 2,000 megawatts under management."