Green Tech

Competition to supply gear to modernize the power grid is heating up as utilities Duke Energy and ComEd named their expected smart grid suppliers on Tuesday.

Duke said that it has chosen Cisco to supply an array of equipment for a planned smart grid program estimated at $1 billion over the next few years. Cisco, which unveiled its smart-grid initiative last month, is expected to supply in-home energy monitors as well as networking hardware for Duke's substations, the utility said.

North Carolina-based Duke aims to provide a digital upgrade to its 11 million customers in the five states it operates.

"Replacing our analog electric grid with advanced digital technology to create a 21st century electricity delivery system largely involves data, networks, and communications--all of it Cisco's expertise," Todd Arnold, senior vice president for smart grid and customer systems at Duke Energy, said in a statement.

Chicago-based ComEd on Tuesday announced its recommended providers, including General Electric for smart meters and Silver Spring Networks, which provides wireless communications and software.

If approved, the smart grid program would bring real-time information on electricity usage and rates to consumers by installing 141,000 two-way meters in 11 Chicago suburbs.

Several utilities are investing in smart-grid technology, such as in-home energy monitors and smart meters. By presenting consumers with up-to-the-minute information on usage and changing rates, utilities hope to cut their peak-time electricity usage and avoid outages.

There are dozens of providers angling for business from utilities in these smart-grid programs.

Seven-year-old Silver Spring Networks has emerged as one of the most successful providers, having secured deals with a handful of utilities, including Florida Power & Light.

Cisco, meanwhile, is making a concerted push around energy efficiency and grid modernization, developing a full line of communications products for utilities, consumers, and building managers.

The City of Miami announced a proposal on Monday to install 1 million two-way "smart meters" to all Miami residents over the next two years in what would be the most comprehensive smart-grid program in the U.S.

Mayor Manny Diaz outlined the Energy Smart Miami plan, which is anticipated to cost $200 million in its first phase, at a press conference at Miami Dade College. Joining Diaz were the CEOs of the key suppliers in the project: Florida Power & Light CEO Lewis Hay, General Electric CEO Jeffery Immelt, Cisco systems CEO John Chambers, and SilverSpring Networks CEO Scott Lang.

"To me these are prudent and smart investments that will easily pay for themselves," Diaz said. "It will show the nation how to address environmental, energy, and economic challenges all at the same time."

The installation of meters with a wireless Internet connection will allow consumers get detailed home energy usage information from the Web, according to Hay, the CEO of the Florida utility. With the up-to-the minute data, consumers are expected to take steps to lower their consumption.

About 1,000 consumers will get in-home energy display from GE, called an EcoDashboard, and have smart-meter-controlled appliances and thermostats. These people will also participate in a demand-response program that will allow the utility to adjust appliances to throttle down electricity use during peak times.

(Credit: Martin LaMonica/CNET)

The project, which will total $700 million across the state, also calls for adding Internet connectivity to substations and other hardware along the distribution grid, which will allow the utilty to prevent or quickly fix outages, Hay said.

Florida Power & Light is applying for a matching grant from the federal government, which would allow the utility to complete the program in two years rather than five, he said. About 100,000 people in FPL's Miami territory already have smart meters equipped with wireless networking card from SilverSpring Networks.

In addition, municipal facilities will invest in solar power at schools and universities, and FPL will buy 300 plug-in electric vehicles and 50 charging stations. With the smart-grid infrastructure, the utility can better incorporate distributed renewable energy generation to make the grid run more efficiently.

"We have 100,000 of the meters deployed already and customers are seeing real savings," Hay said. "It's an open-architecture-based system that will allow new applications to be developed" to automate home energy monitoring.

Stimulating the stimulus
The project altogether involves about 10 technologies, from the power generation station to people's homes, said Immelt.

As such, it would be a showcase for how information technology can upgrade the power grid and lower people's bills, he added. It also will serve to "stimulate the stimulus" plan.

"The most important word to come away with from today isn't 'green,' it's 'now.' The technologies are available now, the investments need to take place, the jobs need to be created now," Immelt said. "This is the kind of project the country should be doing."

Diaz said that the project would create between 800 and 1,000 jobs and pump between $5 billion and $7 billion into the general economy by 2015 from the energy savings of consumers. It's fitting that Miami would be at the forefront of cleaner energy technologies and environmental sustainability because a rise of several feet from global warming would put much of the city, including Diaz' current home, under water, he said.

Cisco will provide the networking infrastructure to transmit information from meters and other devices to FPL. Cisco CEO Chambers said that countries around the world recognize the importance in investing in an automated power grid.

Both governments and businesses need to invest in the grid, much the way the Internet was built. "This is an instant replay of the Internet," he said. "Instead of moving zeros and ones, we're moving electricity."

NEW YORK--Smart-grid upstart Silver Spring Networks closed a round of funding on March 1, which the company hopes will be its last before going public, according to Chief Executive Scott Lang.

Silver Spring Networks raised an additional 20 percent to the $75 million it secured last year, or another $15 million, Lang said during a presentation at the Jefferies Clean Technology Conference on Tuesday here.

After his talk, Lang said the company intends to go public through an initial public offering, although he did not say when.

"I hope (this round of financing) is the last one. We did it to shore up the balance sheet," Lang said during his presentation. "Break-even should be pretty soon based on (sales) volume."

Silver Spring is one of the most established smart-grid companies in the burgeoning field. Founded in 2002, the company has a few large contracts with U.S. utilities, notably Pacific Gas & Electric, Florida Power and Light, and Pepco. It is negotiating deals with other utilities that could connect between 10 million and 12 million homes, Lang said.

The company makes software and chips to create a network that brokers communications between utilities and customers. For example, its products can be embedded in a smart meter so that it can send usage information to utilties in regular intervals and utilities can send electricity rate information to customers in real time.

From a technology point of view, Silicon Valley-based Silver Spring Networks is well known for its decision to use the Internet Protocol standard as the basis for its products.

"I believe that ultimately the trend is toward IP. It creates an open playing field," Lang said. "If the industry doesn't standardize on this, what are we going to standardize on?"

Speedy progress in California
Last July, Pacific Gas & Electric chose Silver Spring Networks as its supplier for a large-scale smart-grid project worth about $200 million, according to Lang.

He predicted that the roll-out of smart-grid gear to 5 million people will take two and a half years, rather than the five years as originally projected.

"The ramp-up is unbelievable. We are deploying over 100,000 homes a month and that will probably double next quarter," he said.

The massive government stimulus plan set aside billions of dollars for modernizing the grid, which includes smart-grid projects.

Lang said that Silver Spring Networks won't benefit directly from government incentives, but it will speed up existing projects. Its Florida Power & Light project is designed to bring smart-grid networking to 4.5 million people over the next four years, which could be shortened from the stimulus money, he said.

The creaking electricity grid got a shot in the arm on Tuesday from venture capital firm Kleiner Perkins Caufield & Byers, which is leading a $75 million investment in smart-grid start-up Silver Spring Networks.

The money will fund the company's expansion globally, Kleiner Perkins partner John Doerr said in a statement. He called implementation of the smart grid "one of the most important clean-technology initiatives of the coming decade."

It's one of the first investments doled out from KPCB's $500 million Green Growth fund, established earlier this year with money earmarked for the costly task of making energy-related technologies commercial.

The "smart grid" is a catchall term to describe a number of products for adding automation to the electricity distribution system. For consumers, it can mean in-home energy displays or appliances that communicate back to utilities to save energy during peak demand times.

Silver Spring makes equipment and software for utilities to upgrade their grid. Its devices on utility poles can broker information over the Internet between a home's smart meter and a utility, to warn of an outage or to send energy usage information.

Smart grids comprise one of the most promising approaches to making the power grid more efficient. By curtailing demand at certain times, utilities can avoid building new power plants to meet growing electricity usage.

Kleiner Perkins' big bet on green technologies was the subject of an extensive profile in The New York Times Magazine on Sunday.

The article said that the storied venture capital firm, which was an early backer of Internet icons Amazon.com, Google, and others, has invested in about 40 green-tech start-ups but is still awaiting a successful financial "exit" of an initial public offering or acquisition.

Existing investors Foundation Capital, JVB Properties, and Northgate Capital will also participate in the Silver Spring Networks funding.

Smart-grid company Silver Spring Networks has raised $17.4 million, the latest in a string of investments in the sector.

(Credit: Silver Spring Networks)

Foundation Capital and Edison Electric Institute were the investors, according to VentureWire, which reported the news.

Silver Spring Networks does software and devices aimed at utilities that are looking to upgrade to smart-grid infrastructure.

The company makes devices on utility poles that can broker information over IP (Internet Protocol) from people's home smart meters and grid operation centers.

Utilities are starting to invest in advanced meters and networking to make power distribution more efficient and cut down on service costs.

For example, the software is designed to let utilities remotely trouble shoot problems or dial down energy usage during peak times in homes of people who choose to participate in energy-efficiency programs.

Three other smart-grid companies--Ambient, eMeter, and GridPoint--recently raised additional funding.