Demand response co. EnerNoc lands $100M contract
EnerNoc (ENOC.O), one of the growing number of companies focused on demand response — the management and redistribution of power based on real-time changes in demand — has landed a contract with PJM Interconnection, an electricity transmission company in the mid-Atlantic region, to manage 1,000 megawatts worth upwards of $100 million.
The year-long contact, 2012 to 2013, will give EnerNoc an unprecedented boost, providing roughly the same sum that came from all of its contracts combined in 2008. On the flip-side of the deal, PJM will be able to provide cheaper, more consistent power to its clients, substantially cutting maintenance and operational costs. Demand response allows utilities to curb energy delivery where it’s not being used to either send it where it’s needed or to juice the grid, preventing expensive outages and disruptions. The deal will cover 35 percent of PJM’s territory. In this system, consumers (residential and commercial alike) that agree to have their energy use remotely decreased during peak times, receive financial compensation.
EnerNoc has seen a lot of action lately. At the end of April, it launched PowerTalk, a service using the same protocol as instant messaging, chat rooms and VoIP programs to gather data from smart meters and appliance sensors. Already used by 250 customers, it allows these devices to send consumption updates to EnerNoc’s network automatically. The rollout is its first attempt to branch out from its core demand response business. At the same time, it reported a 1 percent loss in first quarter revenue this year, a $12.5 million net loss. This sounds grim, but that figure was actually better than expected and didn’t accurately reflect the seven contracts the company landed with utilities during the period. More good news came last week when the class-action suit filed by investors against the company and its officers was dismissed, buoying its stock price 15 percent. The backers in question had alleged various common law and equitable claims, according to Reuters.
A public company for the last two years, Boston-based EnerNoc managed 3,000 megawatts before the contract. It brought in $95.5 million from its IPO and before that took $28 million from Foundation Capital, Draper Fisher Jurvetson, Braemar Energy Ventures and DFJ New England. It competes indirectly with energy management firms CPower and Comverge.
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About the Author, Camille Ricketts
Camille is the lead writer for GreenBeat. She came to VentureBeat from Google where she worked on its traditional platforms team, particularly in TV. Before that, she was a reporter for the Wall Street Journal in New York and London. Follow her on Twitter at @camillericketts, and follow VentureBeat on Twitter at @venturebeat.
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