FERC releases study on DR... Is the Smart Grid just a bubble?... Areva teams up with UISOL


By: SGN Staff

FERC issues new staff report on DR potential.  The Federal Energy Regulatory Commission (FERC) has released the results of a study that project demand response potential for the next ten years. According to the report, the U.S. could save between 38 and 188 GW, depending on how extensively demand response is applied. That’s up to 20% of national peak demand.  The study, titled A National Assessment of Demand Response Potential, also provides projections for each of the 50 states and the District of Columbia using four different scenarios and two time frames (five and ten years). FERC produced the report as part of a requirement in the Energy Independent and Security Act of 2007. A copy of the assessment can be downloaded from Smart Grid Central.

   Quick Take:  Focus on the key word in the title of the study: potential.  We agree the potential is enormous for energy savings, energy trading, and the resultant drop in carbon emissions. Optimizing demand response, distributed generation and market timing to serve up a virtual peaking plant to the electric grid will make someone a lot of money.

   FERC press release

   FERC’s DR report on SGN


Clean tech VC warns of green bubble. The amount of money being invested in clean energy and Smart Grid projects is creating dozens of startups and could fuel a bubble phenomenon, according to Diana Propper, a clean tech venture capitalist with Expansion Capital Partners. During a panel discussion in recent Washington conference on the utility of the future, Propper acknowledged that the Smart Grid has passed the tipping point, but says that with "so much money being sloshed around,” some of it will be spent inefficiently. The story by CNET’s Martin LaMonica, also cites views like those of Ben Koch, managing director of investment banking at Southwest Securities. Koch argues that unlike solar technology, the Smart Grid sector has fewer, more mature companies.  In an Earth2Tech commentary, Katie Fehrenbacher disputes the notion that Smart Grid investing is experiencing a bubble, with the exception of companies developing home energy management tools.

   Quick Take:  The real story here is not whether there is a Smart Grid investment bubble, but instead why did the venture capital industry wait so long to invest? We suspect that most VCs were enamored with renewables, instead of the distribution and transmission technologies necessary to make renewables available, putting the proverbial cart before the horse. DOE’s Smart Grid stimulus grants have wakened VCs to the tremendous potential of this market.(Read our white paper, "The Electricity Economy, New Opportunities from the Transformation of the Electric Power Sector,” link below). Right now, the hype about an investment bubble is really a result of the Smart Grid publicity bubble, not actual investments. Most VCs are still educating themselves about the market. To paraphrase Jim Rogers, Duke’s CEO â€"the Smart Grid is like building a medieval cathedral; it will take several generations of work to accomplish our goal.

   Martin LaMonica’s report

   Katie Fehrenbacher’s rebuttal

   The Electricity Economy (PDF)


Areva T&D forms alliance with business integrator UISOL. Areva’s Transmission and Distribution (T&D) division has struck a deal with Utility Integration Solutions (UISOL), a business integration service aimed for power companies, to develop and market Smart Grid technologies to utilities. The alliance will combine Areva’s background in SCADA, energy, and distribution with the UISOL’s expertise in business processes, applications, and interoperability. Together the two will be in a better position to offer utilities a more complete package of Smart Grid design and build services.

   Quick Take:  The Smart Grid industry is entering a new phase, one which ties Smart Grid technology into the back office with all its billing and customer and data management processes. Integrating Smart Grid data into the business end of running a utility is going to be a crucial piece of the puzzle. By building this aspect of the Smart Grid into its offerings, Areva shows it is recognizing this important trend and can offer a more complete solution to customers.

   Press release


House testimony offers critical view of transmission proposals. Both houses of the U.S. Congress are currently considering measures that would give added power to the federal government for siting and building transmission lines for a newer, smarter grid.  Although such a transmission super highway would allow sun-drenched states to export solar power to its neighbors, others see a darker side. Testifying before the House Subcommittee on Energy and Environment last week Piedmont Environmental Council President Christopher Miller told lawmakers that "Current and proposed transmission policies may produce a transmission grid that is overbuilt, overly complex and subject to reliability problems, and encourages increased reliance on fossil-fuel generation rather than distributed renewable generation, energy efficiency, conservation, and load management." A similarly critical view was offered by Paul Hibbard, chairman of the Department of Public Utilities of Massachusetts. Nevertheless, the SolveClimate news site says that action on the proposed federal transmission policy is accelerating for political reasons as well as the stimulative effect new construction could have on the economy.

   Quick Take:  Not everyone is convinced that proposed transmission projects and authority will offer a healthy solution to our energy problems. For an opposing viewpoint, read more of the report from SolveClimate.

   SolveClimate report on testimony against grid expansion


NIST posts standards roadmap. Following the passage of the ARRA or stimulus bill, Congress and the DOE pressed the National Institute of Standards and Technology (NIST) to get moving on the development of Smart Grid interoperability standards. NIST contracted with Electric Power Research Institute (EPRI) to develop an interim roadmap. And in April and May, the first two of a series of stakeholder workshops were held. Now NIST has posted the first of its interim roadmaps on its Web site. However, the document is careful to note that it is "not a formally reviewed and approved NIST publication. Rather, it is one of many inputs into the ongoing NIST-coordinated roadmapping process.”

   Quick Take: As we’ve pointed out before, standards are going to be a make-or-break issue for companies competing in the Smart Grid sector. Check out our take on the standards issue and the links to our standards primer below.

   NIST standards site

   NIST interim standards roadmap (PDF)

   SGN: Standards for Dummies (Who Want to Get Rich)

   SGN: Standards Primer, Part 1

   SGN: Standards Primer, Part 2 


EnerNOC acquires carbon management software company. EnerNOC, provider of demand response and energy efficiency applications, has announced the acquisition of eQuilibrium Solutions, which develops carbon management and energy efficiency software. The privately held eQ creates software for monitoring, mitigating, and monetizing the carbon footprint of its industrial, institutional, and commercial customers. EnerNOC plans to integrate this product, which comes in the form of software as a service (Saas), into its PowerTrak software platform.

   Quick Take: Up until now, a number of demand response companies have recognized the time value or energy use â€"the ability to shift demand to off-peak hours to lower the strain on utilities. But as climate change legislation becomes a reality, companies will also need to be aware of the carbon value of increased energy use. EnerNOC’s forward-looking acquisition will prove to be a smart move, especially if the cap-and-trade legislation under consideration in Congress becomes the law of the land.

   Press release