Electrical utilities across the U.S. -- and the world --- often don't know what the overall grid looks like. The grid is siloed into sections. Electricity can't be evenly distributed between regions.
So recently, new startups have flocked to try to make the grid more efficient. One company is Optimal Technologies. CEO Roland Schoettle says Optimal wants to provide the "tools" for utilities and other start-ups to do so.
What's needed, he says, is a centralized "brain" that can orchestrate the grid's network from bottom to top, whether we're talking about local utility grids or networks of entire nations.
Only such a brain can help manage the chaos caused by the recent profusion of devices, such as measurement equipment that include intelligent meters in homes and businesses to sensors and switches placed directly on the grid -- not to mention the different types of software that hopes to direct them all. Optimal's Schoette says his company has a product that can be the centralized brain. Called Aempfast (pronounced Aim-fast), the software product remains constantly aware of where electricity has been allocated and how to move it to where it's needed. And it can do so without complex or expensive equipment. "Today, we can process the entire West Coast of the US from Alberta to northern Mexico on a hot-rod PC, in a third of a second," Schoettle says of Aempfast.
To pursue its vision, Optimal hasjust raised $25 million, provided entirely by Goldman Sachs, with $13 million coming immediately, and the remainder in tranches based on progress. The company previously took on about $11 million from private investors. The company was founded in Alberta, Canada in 2000, and just moved into its United States headquarters in Raleigh, N.C.
Today's electrical utilities is based on local power generation. The utilities have multiple siloed tools that all track their own area, but can't communicate with each other. And hooking in small, new sources -- like solar deployments or wind turbines -- presents a serious challenge, because the grid as it's conceived by existing software doesn't anticipate electricity flowing back in away from the central generators.
Schoettle says Aempfast can easily solve all those problems, by replacing the existing software to create a new "operating system" for utilities. In the process, it can also reduce electricity usage by 10 percent, he says, and prevent blackouts by rapidly re-routing and optimizing power, and accommodate micro-installations like rooftop solar. All big claims, but then Schoette says the software has been tested by major utilities including Pacific Gas & Electric. Optimal's technology rests on mathematical models and algorithms Schoettle says are unique. "There are many universities that teach what we do can't be done, a lot of technological arrogance," he says.
Schoette says the development of Optimal's underlying technology has actually been underway for well over a decade, and that the basic idea can also be applied to other networks, like transportation. So, one might ask, why aren't utilities lining up to switch to Aempfast? That's where the story gets sticky. Schoettle says that utilities have built their business around inefficient practices -- including the business of billing people. Remove the Byzantine structure built up around arcane, localized practices, and the finance departments of utilities may fall to pieces, he says: "We're not focused on the US, because the rules here aren't favorable -- PG&E and the others aren't incentivized to use this." Instead, Optimal is taking its technology to Europe, where Schoettle says they'll be announcing a big project with a utility in the United Kingdom within a couple months. In the meantime, they'll also be developing a cousin to Aempfast called Surefast, which will manage homes and businesses, set for release near the end of the year. Will Optimal can live up to its promise? If so, it will create a serious complication for competing software startups like eMeter and GridPoint, each of which is in late stages of development and funding -- eMeter just raised $12.5 million, and GridPoint just took another $15 million, topping $100 million to date. On the other hand, having a truly smart grid could boost startups like Silver Spring Networks, which makes monitoring equipment.
