Predicting the present using the vision of tomorrow in the SmartGrid marketplace.
When you are predicting the future, you can only be wrong in retrospect, but if you predict the present, you can be wrong today – it seems a bigger risk and a more intriguing challenge. Let’s apply some facts to estimate the current state of the Smart Grid Market, read on for my take.
Predicting the present using the vision of tomorrow in the SmartGrid marketplace.
I attended the Cleantech Open Conference in San Jose, CA, yesterday and thoroughly enjoyed getting an early look at some promising cleantech innovation, including the heatless low-voltage lighting of TylerCo, the recyclable and compostable building materials of Stramit, and the energy optimization services of Amberix. What stood out even more than these technologies, though, was the discussion around behavior change. Dr. Kristina Johnson, Under Secretary for the U.S. Department of Energy (DOE), discussed a number of new ways the DOE is helping to nudge along innovation, and she cited some impressive facts about the possible emissions reductions we could all achieve if we just eliminated one or two car trips each week. We’ve all heard statements like that from public officials before, and while they are no doubt true, I couldn’t help thinking about just how hard it can be to inspire genuine behavioral change – even when people are convinced that it’s a good thing to do. I wasn’t the only one with behavior change on my mind that day, as this conversation could be heard throughout the conference from the smart grid session to the transportation panel, but it’s something with which I have …
I grew up with a superstition: bad news comes in threes. Thin film solar took two hits in the past month. Solyndra’s withdrawal of its S-1 filing squashed hopes another “First-Solar-like-event” for Thin Film industry and investors. Yesterday Applied Materials had a “realization” their focus on cheaper, less efficient solar panels was misplaced.
Both companies built steam during “The Great Silicon Shortage of 2007.” In response, Applied launched the SunFab product line and many other notable Silicon Valley based thin film companies (Solyndra, Nanosolar, and MiaSolé) leveraged the promise of “cheaper than silicon solar” to rapture Sand Hill Road VC. To give you perspective, the peak price of polysilicon in 2008 was over $400/kg; this week’s average price on spot market: $56.50/kg.
I always remind people, the thin film space is comprised of ONLY three primary technologies: cadmium telluride (CdTe or CadTel), copper indium gallium (di)selenide (CIGS), and amorphous/micromorphous Silicon (aSi) and the best technology choice is the one that offers the most competitive Levelized Cost of Energy with considerations to location, local power markets, and balance of system costs. First Solar’s technology uses CdTe, Solyndra uses CIGS (along with other Silicon Valley darling MiaSolé & Nanosolar), Applied Materials …
With waves of hype and excitement around electric vehicles – the recent razzle-dazzle IPOs of Tesla Motors and A123Systems contributing to the frenzy – many are overlooking the more traditional areas of green transportation focused on making what we already have better. Among these technology categories is the tried-and-true internal combustion engine (ICE). Admittedly, the ICE has been around for more than a century, but it is a mistake to believe that because the technology is mature it can’t be meaningfully improved.
Cutting edge materials are pushing temperature and pressure thresholds to new limits, allowing more powerful and efficient combustion. Reliable, compact, and ultra-fast electronic controls enable super precise timing and dynamic adaptation to driving conditions and pilot inputs, reducing fuel consumption and emissions while increasing power. Sophisticated simulation software incorporating the latest numerical techniques mated with inexpensive computing resources have opened the doors to unprecedented predictive capability – offering insight into spray formation, air-fuel mixing, location and speed of combustion, and thermal signatures on pistons and cylinder walls. These advances are also permitting broader engine operational ranges, opening the door for the phased introduction of renewable fuels. And on face value there is plenty of room for improvement: commercial ICEs …
Why do countries fight over water resources? Because as nations manage economic growth, precious water resources become the clear conduit required to supply both energy and food to growing populations.
A recent article published by the New York Times featured the growing tensions between India and Pakistan over water – as if their relationship isn’t strained enough. Pakistan is concerned that the Indian hydroelectric dam currently under construction could divert water that flows from mountain glaciers to Pakistan’s agricultural industry. It is a story of two countries competing over a water source to achieve energy and food security.
The growth of any city or society is founded on human access to water. Without it, growth cannot occur. Should something or someone get in the way of these resources, it is likely to ruffle some feathers.
Consider Los Angeles. At the beginning of the twentieth century, we could point to one event that catalyzed the growth of this now, population of 4 million: the construction of the Los Angeles aqueduct that diverted water from the Owens River Valley approximately 300 miles away. If members of the Owens River Valley ecosystem could wage a war, they surely would have as the growth …
To-date, cleantech venture and private equity investors have shied away from the agriculture space; perhaps out of lack of expertise in the sector and/or the inability of investors to reconcile agricultural investments with their more short-term and less capital intensive financial models derived from the IT industry. Nonetheless, over the past nine months, more new funds are beginning to signal their interest in the sector and recognize its strategic importance, albeit cautiously. (See: New venture funds cautiously dabble their toes in sustainable agriculture.)
This is where the UK-based boutique asset manager Agro-Ecological Investment Management comes in. Agro-Ecological is planning to establish a new fund that aims to breakdown these seemingly insurmountable barriers to entry by pioneering sustainable agriculture and farmland as a profitable asset class, and creating a fund that is palatable to the private equity world.
“Agro-Ecological will invest in conventionally managed farms and convert them to certified organic production. We will adopt a holistic ecological/organic approach that will ensure that the land is agronomically and financially more resilient, eliminate the use of chemical fertilizers, pesticides and genetically modified organisms, enhance soil structures, conserve water and ensure the conservation and sustainable use of biodiversity,” according to Geoff Burke, …
I wrote earlier in the month about OG&E’s regulatory approval for its smart meter rollout. The deployment continues to be a source of interesting news: this time it is an announcement of a new slate of vendors being added to the mix of the utility’s recipe for smart grid stew.
I spend a great deal of time in my research and client work trying to make sense of the smart grid vendor ecosystem, deciphering the desires of utility buyers for best-of-breed vs. integrated solution providers, and analyzing how a myriad of smart grid elements (hardware, software, communication networks, services, etc.) will come together to enable a truly smarter grid. This is why I get overly-excited to pick apart vendor announcements from the likes of OG&E.
- Smart Meter: GE Energy
- AMI Network: Silver Spring Networks
- Meter Data Management: EnergyICT (Elster)
- Customer Portal/DR Interface: Silver Spring Networks (Customer IQ)
- Meter Installation Services: Corix Utilities
Last week’s announcement added three new vendors into the mix:
- Private Wide Area Network: Alcatel-Lucent
- Distribution Management System: ABB
- Asset/Field Inventory Services: Osmose Utilities Inc.
It’s so easy to get caught up in the comforts of life that at some point, we look up and realize how wasteful (or stupid) we are with such a precious resource. In my recently released report, Demand-based Water Use: Focus on Smart Irrigation, I came across several staggering data points that have underscored the critical need for better water resource management.
The first doozy: 58 percent of U.S. commercial and residential water is used for outdoor irrigation. Seriously? That’s a whole lot of water just to keep our landscapes looking pretty. At the very least, we should mitigate wasteful irrigation practices.
As I illustrate in this brief, there are five commercially available smart irrigation companies helping farmers, commercial building owners, corporations and homeowners conserve water, save energy and reduce pollution with a payback period of fewer than two years, to boot! Anything short of smart irrigation just seems…….criminal, if you want to get dramatic about it.
Investments in important supply-side solutions to water resource management like desalination cannot come at the cost of sensible demand-side conservation measures. Investors should look to the economic and water conservation breakthroughs smart irrigation has helped businesses achieve.…
In my report on sustainable agriculture published in December 2009 entitled ‘Preparing for a second green revolution’, I wrote that one of the reasons why venture capital and private equity investment in the sector is so low, is that there are few experts with both venture investment and agricultural expertise.
At the same time, the drivers for investing in sustainable agriculture – forecasted food demand rising to unprecedented levels combined with tougher constraints on increasing food supply and the damaging nature of conventional modern farming – are more pertinent. Hence I concluded that it wouldn’t be long before investors become more incentivized to discover the commercial opportunities and put money to work in the sector.
It seems as if this forecast is somewhat materializing. Even though venture capital investment in sustainable agriculture still constituted only 3% of global cleantech investment in 2Q 2010, there was clear heightened interest from new cleantech investment funds from across the globe to invest in the sector.
Asia-based CLSA and Origo Partners, U.S.-based Global Environment Fund and JAFCO Ventures, and European investors BeCapital and Robeco are but some of the investors that made fund raising announcements in 2Q 2010 with the intention …
Although the current mandates for carbon regulation have focused on the heavy emitters of big industry, emerging markets such as real-estate, hospitality, building management, health care and financial services are actively figuring out how to manage and report carbon emissions. Unlike many of the big emitters, these “clean” industries are not driven by compliance; rather they are feeling pressure to disclose and reduce greenhouse gas (GHG) emissions from investors and consumers.
And for good reason – research shows that consumers, shareholders and stakeholders favor “green” companies. A study conducted by Green Seal found that despite the poor economy, four out of five consumers stated that they were buying some level of green products and services. Investors are beginning to demand company disclosure and accountability. Sustainability rankings, like the Dow Jones Sustainability Indexes, are becoming increasingly part of the decision making process.
Although these organizations have relatively small environmental footprints compared with utilities and manufacturing companies, they still have a real and unmet need to manage and reduce their environmental impacts. These footprints are significant. Within the U.S., the building sector is one of the biggest sources, accounting for approximately 48 percent of annual GHG emissions (U.S. Energy Information …