Fresh news on smart grid and green technologies
Within the next four years, 76 percent of the traffic through the world’s data centers will be cloud-based traffic. Increasingly, this traffic will consist of public cloud services, as more enterprises become more comfortable with this model. Software as a Service will also dominate.
That’s the latest prediction from Cisco, which crunched the numbers in its latest Cisco Global Cloud Index (2013 – 2018). The Cisco report also forecasts that overall data center traffic will triple in volume, growing from 3.1 zettabytes a year in 2013 to 8.6 zettabytes in 2018. (A zettabyte is a trillion gigabytes.) The growth will be at least 23 percent annually.
Of course, global cloud traffic is growing faster than the overall global data center traffic. In 2013, cloud accounted for 54 percent of total data center traffic, and, by 2018, cloud will account for 76 percent of total data center traffic. Data center traffic includes data center-to-user traffic along with data center-to-data center traffic and traffic that remains within data centers. Already, the cloud data centers are generating a total of 2,277 exabytes of the total 3,829 exabytes being generated. By 2018, this proportion will be 6,496 exabytes of a total of 8,574 exabytes.
There will be a notable shift to public cloud services as well. Public cloud workloads will grow at a rate of 33 percent a year. By 2018, 31 percent of the cloud workloads will be in public cloud data centers, up from 22 percent in 2013. Private cloud workloads will grow by 21 percent a year. By 2018, 69 percent of the cloud workloads will be in private cloud data centers, down from 78 percent in 2013.
EnerNOC Inc. (Nasdaq: ENOC), a Boston-based provider of energy intelligence software, said Tuesday that it has agreed to acquire World Energy Solutions Inc. (Nasdaq: XWES), a Worcester energy management technology and services firm, for $76 million in cash.
The purchase price of $5.50 per share represents a premium over World Energy’s closing price of $4.15 per share Tuesday.
Tim Healy, chairman and CEO of EnerNOC, said that the acquisition would add about $30 million to EnerNOC’s annual recurring revenue. World Energy’s software is used by 4,000 companies, according to EnerNOC.
“World Energy’s software is used by more than 4,000 enterprises for energy supply management,” Healy said in a statement. “The integration of World Energy’s software into our platform will help accelerate EnerNOC’s product roadmap and add approximately $30 million to EnerNOC’s enterprise annual recurring revenue.
In the six months that ended June 30, World Energy generated $18.9 million in revenue and has customers across the U.S., according to EnerNOC. World Energy has more than 100 employees.
Home-grown demand response firm Diamond Energy can be counted among the Singapore cleantech sector’s bigger success stories. But nowhere in the company’s description are the words “environmentally friendly” to be found.
Instead, Diamond Energy attracts its customers – building owners, manufacturers, and other large power consumers – with the catchphrase “Go Green, Save Money, Make Money”.
“Our focus is not about advocating improving energy efficiency or achieving energy savings,” explains Laurence Kwan, Diamond Energy’s business development manager. “It is about helping electricity customers realize a new stream of revenue from interruptible load participation in the National Electricity Market of Singapore.”
Diamond Energy is the first wholesaler licensed by the regulator Energy Market Authority to trade in demand response. This is also known in industry terms as “interruptible load”, which is essentially getting an electricity consumer to reduce a portion of their consumption temporarily by a pre-determined quantity if called upon to do so, in exchange for payments.
During unforeseen events in the power grid such as a generator failure, electricity consumers in Diamond Energy’s portfolio may be asked to reduce their power usage and thereby take some load off the grid.
Customers are paid based on their availability to reduce their consumption, irrespective of whether they are actually called upon to reduce their load or not. The company provides the technology – hardware and software – that control the amount of electricity being consumed by its clients at any time.
EnerNOC has completely changed the way it describes itself. Although the Boston-based company is best known as a demand response provider, that’s not the description it prefers.
Rather, CEO Tim Healy calls it an “energy intelligence software company” that is focused on providing analytics for building energy management all day, every day — not just during peak times.
That’s not the only thing that has changed for EnerNOC. Its geographic footprint has also evolved in the same way.
Three years ago, 99 percent of EnerNOC’s revenues came from U.S. operations; last year, nearly 20 percent of revenues came from international markets. Most of that activity came from Australia, New Zealand and Canada, but the company is now offering various energy management services in 100 different countries.
“More so than ever before, EnerNOC is a global company,” said Healy, speaking at the Forum 20/20 conference in Boston. He said 35 percent of his staff is now located outside of America.
EnerNOC is now entering South Korea, following an expansion into Japan, Germany and Ireland in 2014.
Today Healy announced that EnerNOC has secured several large customers — LG Chem, Kolon Industries, COEX and Korea Paper — to provide demand response services that will be sold on the Korean Power Exchange. Earlier this spring, Korea established a demand response market for the first time, opening up an opportunity for companies like EnerNOC with experience in the more mature U.S. market.
Healy said the strategy would be to “go and get customers to adopt new [energy management] software by helping them get involved in demand response opportunities first.”
Demand response will enable EnerNOC to enter new markets. But it sees software as an equally large revenue opportunity. According to the company, energy intelligence software will add $70 million in sales — nearing the $90 million expected from international demand response markets.
Unlike many other cleantech industries where the U.S. has historically lagged, new demand response markets like the one in South Korea have emerged because of American leadership. Healy said the company has seen a dramatic pull from countries attempting to emulate what the U.S. has done.
Cloud computing is uniquely susceptible to the perils of myths due to the nature, confusion and hype surrounding it, according to Gartner.
These myths slow things down, impede innovation and induce fear, thus distracting from real progress, innovation and outcomes.
Even with a mostly agreed on formal definition, multiple perspectives and agendas still conspire to mystify the subject ever more. Add the incessant hype and there can be a resultant confusion that permeates IT – and beyond – today.
Gartner has highlighted some of the most dangerous and misleading cloud myths.
1. Cloud is always about money
While prices are dropping, especially for infrastructure as a service (IaaS), not all cloud service pricing is coming down (for example, most software-as-a-service (SaaS) offerings). Assuming that the cloud always saves money can lead to career-limiting promises. Saving money may end up one of the benefits, but it should not be taken for granted.
2. You have to be cloud to be good
This is the manifestation of rampant “cloud washing”. Some cloud washing is accidental and a result of legitimate confusion, but some is also based on a mistaken mantra (fed by hype) that something cannot be “good” unless it is cloud. IT organisations are also increasingly calling many things cloud as part of their efforts to gain funding and meet nebulous cloud demands and strategies. The resultant myth is that people are falling into the trap of believing that if something is good it has to be cloud.
>See also: How to build the best hybrid cloud for your business
3. Cloud should be used for everything
Related to Myth 2, this refers to the belief that the actual characteristics of the cloud are applicable to, or desirable for, everything. Clearly, there are some use cases where there is a great fit – however, not all applications and workloads benefit from the cloud. Unless there are cost savings, moving a legacy application that doesn’t change is not a good candidate.
“The LEED Demand Response credit is essentially a peak load reduction credit, with temporary and permanent ways to do that,” says Mark MacCracken, CEO of CALMAC. “Demand response is temporary relief for the grid, while permanent load reduction fundamentally changes the way a building consumes energy.”
Mr. MacCracken will be a panelist today at the Greenbuild International Conference and Expo, in an education session titled, “Challenges & Opportunities: Demand Response & Peak Load Reduction.” New Jersey-based CALMAC manufactures IceBank thermal storage units used in cooling commercial buildings.
The U.S. Green Building Council’s LEED standard version 4 includes a Demand Response (DR) credit intended to reduce the load on the electric grid through either temporary or permanent peak load reduction. It’s available in the LEED Building Design & Construction (BD+C) and the Operation & Maintenance (O+M) rating systems.
During the development of the credit, it was given to a building that temporarily reduced energy use during a demand response call. The next step, in the new LEED v4 O+M for Existing Buildings, was to give credit to a building owner who invested in permanent load shifting technologies.
According to Mercom Capital Group, VC funding for smart grid companies totaled $142 million comprised of 26 deals in the third quarter of 2014 — up from 13 deals totaling $81 million in the second quarter of 2014.
The top VC funded companies in the third quarter were a home automation solutions provider, a big data analytics and cyber security solutions provider, a provider of cloud analytics software to optimize energy consumption for buildings, a technology platform provider for the intelligent active management of distributed energy assets allowing renewable energy generators, storage providers and energy users to trade at a micro-grid level, and an electric vehicle charging infrastructure provider.
Twenty-seven investors participated in smart grid VC funding rounds in the third quarter of 2014, including two accelerators — a good sign for the industry.
“The resurfacing of startups from incubators/accelerators is a healthy sign for the sector, indicating new opportunities for disruptive technologies,” said Raj Prabhu, CEO and co-founder of Mercom Capital Group.
According to Mercom, 12 smart grid communication technology companies raised a combined $104 million and two data analytics companies raised $12 million. One security company raised $10 million, while three smart charging and vehicle to grid companies raised $8 million. Three demand response companies raised $6 million and three distributed generation companies brought in $2 million.
Itron has taken the next logical step in its push to embed computing power and analytics capabilities in the devices that make up the smart grid — by moving beyond the grid itself and into the devices that use its power.
On Monday, Itron announced that it’s expanding its “edge intelligence” platform to include smart thermostats, pool pumps, water heater and air conditioner controllers, and a host of other load control devices. It’s the first set of devices to be linked through Itron’s Riva platform — the IPv6-capable, Linux-programmable distributed technology platform it developed with partner Cisco Systems over the past few years and officially unveiled last week.
Right now, all of Itron’s available devices are built by partner Corporate Systems Engineering, but it’s working with other potential device partners, as well as with several utility clients interested in putting them to use, Stephen Johnson, Itron’s consumer energy management product line manager, said in a Monday interview.
Itron is also embedding its intelligence in agricultural pumps and remote terminal units (RTUs) that control grid or factory equipment. Itron’s display of connected devices at its annual Utility Week users conference this week in San Antonio, Texas, also included networked streetlights, although the company hasn’t officially announced a Riva-embedded streetlight control product yet, Johnson noted.
EnerNOC, Inc. (Nasdaq:ENOC), the world’s largest provider of demand response software and services, announced today that Kolon Industries has selected EnerNOC as its trusted demand response provider. EnerNOC, which supports demand response programs throughout Asia, Europe, and North America and is an official KPX curtailment service provider, will use its patented technology to help Kolon maximize its demand response participation, while providing relief to the grid during system emergencies.
“We’re excited to be growing our network of demand response participants in Korea, and honored that Kolon Industries has chosen EnerNOC to manage its participation in the KPX program,” said Jeff Renaud, Senior Director, Market Development at EnerNOC. “By enrolling in demand response with EnerNOC, Kolon is doing its part to help maintain reliable, affordable electricity throughout the region.”
In exchange for its participation, Kolon will receive payments year round, simply for agreeing to be on standby if and when they are needed. If demand response resources are dispatched, Kolon will receive additional payments based on how many megawatts of demand it reduces during the duration of an event.
For Kolon, business operations will continue uninterrupted as critical load will switch to back up generators and all unnecessary usage will be curtailed.
For more information about enrolling in KPX’s demand response program, please visit www.enernoc.co.kr or contact 3452 1840 02 or email firstname.lastname@example.org.
« Previous entries
On May 23, a three-judge panel from the U.S. Court of Appeals for the D.C. Circuit vacated FERC Order 745, the regulation issued by the Federal Energy Regulatory Commission that calls for electrical grid operators to pay the market price, known as the “locational marginal price,” to demand response resources that curtail their energy consumption in the real-time or day-ahead energy markets.
The evolving energy industry formally voiced its opposition to the U.S. Court of Appeals’ decision, with FERC officially asking that the ruling be reversed. Several states, a number of innovative energy companies, many large business entities, and PJM — the world’s largest electric grid operator — also joined FERC in seeking a reversal of the D.C. Circuit Court opinion. Unfortunately, in a very terse rejection, the D.C. Circuit Court of Appeals denied the requests to reconsider its May opinion. It’s not hyperbole to say that these actions could have significant and dire consequences on the United States’ energy initiatives and conservation goals. Simply put, the D.C. Circuit Court’s rulings will result in our nation’s evolving smart grid becoming dumber.
Demand response relieves strains placed on the electrical grid by curtailing energy usage during periods of peak demand. This is a highly valuable resource. By helping to balance supply and demand, demand response drives down energy prices, contributes to the stability of the grid, and reduces our reliance on “peaker” power plants, which are notoriously energy inefficient and costly facilities. Through demand response programs, electric utilities are able to offer financial incentives to customers and then curtail their energy usage in order to maintain grid stability. Demand response provides the greatest financial incentive for individuals and organizations to participate in energy markets, allowing them to manage the demand side of the supply/demand relationship. This approach has worked for decades.
Most importantly, demand response is the market tool that allows evolving technologies to be compensated by market-based forces at market-based rates in energy markets. Energy storage, for example, isn’t compensated for just sitting on the side of a building. That storage device must provide a service (a response) to the market and provide that response when called upon, and the storage device is then compensated for providing the response.
Demand response is also evolving into more of an operational resource that can be used to integrate renewable resources (rooftop solar, wind, and others) into the grid and otherwise modify electricity demand when needed, and it provides a market-based compensation mechanism for those services. It is a comprehensive and valuable resource available in the markets today, enhancing the value of smart grid investments.
The major problem with the D.C. Circuit’s ruling is that in order for any business or household to actively participate in energy markets and help balance supply and demand, there needs to be an incentive for them to be flexible with their energy usage. The D.C. Circuit has invalidated that incentive. Why would anybody embrace demand response if one of the major motivating factors — economic compensation — is removed?
· Next entries »