Late last month, Boston-based smart grid company EnerNOC (NASDAQ: [[ticker:ENOC]]) revealed that it’s looking to the consumer Internet for a new way of managing its “demand response” pools.
These are the groups of companies and municipalities that, in return for cash payments from EnerNOC, sign up to have their electrical consumption dialed back remotely in times of peak demand. EnerNOC markets the pools to utilities and grid operators as the equivalent of a new generating source (since utilities that tap the pools can avoid building more power plants or turning to expensive “peaking plants” just to fill in during peak hours).
The only problem with EnerNOC’s first-generation demand response network, which it’s been building since 2001, is that it can’t be activated quite as quickly as conditions can change on the electrical grid. Utilities and system operators are used to seeing how much power is available in real time—but EnerNOC’s system pulls information from its 5,000 customer sites at intervals ranging from every 20 seconds to every 5 minutes. To make the demand response pools look and behave more like a conventional supply-side resource, the company needed to get data more frequently.
So it turned to instant messaging. EnerNOC’s new “PowerTalk” networking technology, which has already been installed at more than 250 customer sites, is based on the same protocols behind common IM programs like Windows Messenger, AOL Instant Messenger, or Google Talk; data is “pushed” from the sites to the company’s network operations control center whenever there is a change to be reported, rather than pulled at rigid intervals. The company says that makes the demand response pools more suitable for wholesale electricity markets that require high-frequency data reporting, such as the PJM Interconnection organization that serves 13 eastern states.
The instant-messaging angle caught the fancy of journalists, who reported the story widely back in late April (“OMG! EnerNOC Brings Instant Messaging to the Smart Grid” was Fast Company‘s headline). So when I caught up recently with EnerNOC co-founder and president David Brewster, I wanted to ask him more about how PowerTalk improves on the company’s existing communications network, how quickly it will roll out the technology to customers, and whether EnerNOC hopes the idea will catch on more widely as utilities and the Obama Administration look for ways to make the electrical grid smarter. An edited version of our talk follows.
Xconomy: Set the stage for this PowerTalk innovation by describing how your first-generation information network functions. You had built a system that go out and “poll” the smart meters at customer sites, correct? What was deficient about that?
David Brewster: We did have the ability to poll devices, at any frequency we wanted—say, every 20 seconds. But when you’re dealing with 5,000 devices out in the field, it becomes a scheduling challenge. Our network operations center (NOC) would reach out to each of these 5,000 distributed devices and say, “Give me your info, give me your info, give me your info.” We had what we called “near-real-time” connectivity to our devices. Some markets required a 1-minute data interval, some only 5 minutes. We put those into a schedule and we’d have to literally reach out and pull the data back into the NOC.
X: And how is PowerTalk different?
DB: The big difference now is that we’re doing real-time monitoring. Through the technology in PowerTalk, the devices now have the intelligence to push data to our NOC. That makes it much more scalable. The other benefit is this concept of presence, which means that any time there is a status change on any of these devices, we know instantaneously, in seconds or less, which is the same frequency with which grid operators and monitoring and managing their centralized generation facilities. We can now operate with that same kind of data latency. So our demand response pool starts to look and feel to the grid operators and utilities like something they’re used to seeing—it looks like a traditional supply-side resource. That was a big mental barrier for them, and we think it’s going to get them much more comfortable with demand response as a resource.
X: Does using a standardized technology like instant messaging make the communication itself simpler for you?
DB: Before, when we had to poll these devices from our NOC, we had to reach out and get into the customer’s network to reach the device. We needed to set up a virtual private network with the customer’s IT department to tunnel in securely, or we’d need to set up a cellular wireless card or a dedicated DSL line, which are both expensive. With PowerTalk, we have overcome those hurdles. We literally bolt our device to the wall and plug into the customer’s local-area network, and it goes out onto the Internet and finds our NOC and self-registers and establishes a secure handshake. It’s just like
