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• Since Vice President Joe Biden announced the Department of Energy’s plans to deliver $3.4 billion in grants for smart grid technology development back on the 16th, the cleantech world has been rampant with both big players and startups announcing their different approaches in hopes of grabbing a slice of the pie.
• Within the program, grants ranging from $500k-$20m will be distributed for deploying smart grid technology, while $100k-$5m will go towards grid monitoring devices, covering as much as half the applicant’s investment costs.  An additional $615 million will go towards smart grid demo-projects displaying storage, monitoring, and technology.
• One of the largest efforts within the cause is the deployment of smart meters, which apparently the government feels to be paramount as Obama’s already called for the installation of 40 million smart meters across the nation.  The current utility business model where an employees needs to physically visit a location to read the meter is completely outdated and inefficient.  Smart meters will facilitate the two-way communication between utilities and the end users delivering energy when and where it’s needed.  Google’s been recently pushing the DOE to make large investments in smart meter deployment, which makes sense because they invested almost $11 million last summer into EGS technology, which they say has “the potential to deliver vast quantities of power 24/7 and be captured nearly anywhere on the planet.”
• Smart meters currently make up a measly 4.5% of all installed meters, and considering the cost between $100-$250 a pop, this shows room for some big-money deals to go through.  As of current, the top players are Itron, Landis+Gyr, Sensus, Elster, and GE with Itron leading the back both nationally and globally.  Itron’s already locked down utility contracts with Southern California Edison, San Diego Gas & Electric, and CenterPoint Energy.  Only problem with Itron is the smart grid will eventually become reliant on the software that runs the product, and since Itron focuses exclusively on hardware, it may become difficult for them down the line.  Landis+Gyr have been big players for decades in Europe, and now hope to take advantage of the stimulus to enter the US market.  They’re reportedly already working with Oncor and PG&E.  US player, General Electric, is currently working with PG&E, American Electric Power, and Oklahoma Gas & Electric.  Even more recently, Florida utility FPL announced it is teaming up with Cisco, Silver Spring Networks, and GE to provide them with 1 million smart meters for a test run called Energy Smart Miami.  If the test goes well, FPL will expand to the rest of its 4.5 million customer-base.
• The competition doesn’t end there, as cell phone companies are now jumping in to play.  Texas utility TNMP just teamed up with AT&T and SmartSynch, rolling out 10,000 smart meters throughout Texas homes.  AT&T will provide the network upon which SmartSynch’s smart meter technology will communicate with TNMP and the home.  T-Mobile just announced a partnership with Echelon, a smart meter producer, and that their developing a durable SIM card that’ll be embedded in smart meters to assist in the communication process.
• The only real backlash we’ve seen from utilities is that the $500k-$20m grant offered by the government isn’t going to be near enough for projects of significant size. PG&E’s budgeted $1.7 billion, FPL at $700 million, and Duke Energy’s budgeted $1 billion over the next five years.  Even smaller utilities are planning on spending upwards of $200 million, so you can see why $20 million might not help as much as one would think.
• No matter the case it’ll be atleast a year or so before we see results of these buildouts, but one can definitely picture the lucrative horizon ahead for players in the smart grid.  Cisco’s CEO, John Chambers, refers to the smart grid as an “instant replay” of the internet.  One thing is for sure, companies that can provide high quality forms of software-based demand management and home energy management network services will likely become the long-term beneficiaries of this necessity to our country’s future.

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