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Silver Spring embraces cloud, software-as-a-service for smart grid

Katie Fehrenbacher — Wed, 01 Aug 2012 19:31:33 +0000

Smart grid company Silver Spring Networks launched a new service on Wednesday that uses the cloud and software-as-a-service to give utility workers access to real time data, for monitoring grid systems and receiving alerts. You might think utility employees already have access to services like this — which are starting to dominate other industries — but the power sector is relatively slow moving and just starting to gain the benefits from advanced networking, big data management, and mobility.

Silver Spring Networks’ new service, called SilverLink, enables utility workers outside of the back office operations center to access these types of software tools on demand, via a subscription. Silver Spring Networks already offered its utility customers similar software but not as an on-demand cloud-based service outside of the back office, and Silver Spring largely had to customize these tool for select customers.

Utilities and smart grid companies need to lean heavily on the cost-reduction and performance benefits of the cloud. All industries that use networking should; it’s just the future of how IT networks are getting built. Companies with networks already built out, are touting those benefits, like Verizon, which teamed up with meter data vendor eMeter to offer utilities cloud-based smart meter management services last year.

Silver Spring needs to sell more services and software down the road. Building out networks for utilities is a low margin business. But since Silver Spring owns the networks for the customers it works with, it has an advantage when it comes to selling them these types of services.

The company, which was founded in 2002, filed for an IPO last year but has yet to go public and instead raised money from EMC and Hitachi. For the six months ended June 30 2012, Silver Spring generated $107.04 million, down slightly from the $115.50 million from the same period the year before. For the same six months in 2012, Silver Spring posted a net loss of $41.84 million, which is a smaller loss than it reported for the same six months in 2011, at $54.39 million.

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Smart grid VC funding has been “extremely weak”

Katie Fehrenbacher — Mon, 23 Jul 2012 17:57:48 +0000

Investments by venture capitalists into smart grid companies — or firms that are adding digital intelligence to the power grid — has remained “extremely weak” over at least the last three quarters, according to research firm the Mercom Capital Group. Investments by VCs into smart grid companies peaked in 2010, and have continued to decline throughout 2011 and 2012. This includes the venture arms of the corporates, like Siemens, ABB, and General Electric.

Mercom says this is due to:

“shifting business models as the industry continues to struggle to understand customers needs and address customer misconceptions along with security concerns among other issues.”

Let’s look at the amount of IPOs and acquisitions for smart grid startups, which is what VCs look at when they decide if they want to invest in a sector or company — essentially how much money can they get back for their investment.

Smart grid network Silver Spring Networks has yet to go public, despite filing its S-1 in the Summer of 2011. Silver Spring Networks has investment from Foundation Capital, Kleiner Perkins, W.R. Holdings, and more recently EMC and Hitachi. I thought Opower would have gone public by now, too. Opower has investors including New Enterprise Associates and Kleiner Perkins.

Acquisitions are actually pretty prevalent in the smart grid space. But a lot of the purchases are either large power companies buying other large energy hardware makers, or the smaller smart grid startups that are many times being sold off for small amounts. SmartSynch and Ember were sold off for not much more than they had raised over their lifetimes. Many of the small smart grid deals are not being disclosed because the investors don’t want to reveal the low valuation of the company.

Then there’s just the fact that the smart grid has stalled a bit, at least in the U.S. Some of that has been because of an inability of utilities to actively engage consumers, and another reason has just been an affect of the recession.

Pike Research has predicted that installations of smart meters in the U.S. will actually sharply decline over the next two years, before they pick back up. One of the reasons is that utilities in California will have finished many of the smart meter installation projects that they started a few years ago. Another reason for the decline is that the Department of Energy gave smart meters a temporary injection a couple years ago.

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Silver Spring Networks still chugging along

Katie Fehrenbacher — Thu, 14 Jun 2012 20:49:14 +0000

Despite that smart grid network company Silver Spring Networks has yet to go public, the company is chugging along and had a pretty good quarter, according to the latest amendment to its S-1. For the latest quarter, Silver Spring generated increased revenues and reduced losses from the quarter the year before.

For the three months ending March 31, 2012, Silver Spring generated $55.5 million in revenues, up from $46.7 million in revenues from the quarter the year earlier. The net loss for the most recent quarter was $18.4 million, a smaller loss than the loss of $33.4 million for the quarter a year earlier. Gross profit for the quarter was $10 million, up from a $1.3 million gross loss for the quarter the year before.

Silver Spring is still operating at a net loss, and has accumulated a deficit of $479.2 million as of March 31, 2012. Part of the reason for the losses is because the sales cycle for selling a wireless smart grid network to a utility is very long. Silver Spring has $404.5 million in deferred revenue as of March 31, 2012, which it will be able to collect at the end of those sales cycles.

Silver Spring needs to increasingly sell services over its networks, as there’s a limited amount of utility customers that will ultimately buy the end-to-end network and the margins aren’t all that high on the network, compared to software. The company is working with investor EMC on smart grid analytics.

Silver Spring raised money from both EMC and Hitachi in recent months. Will the company be able to raise money through an IPO this year? Your guess is as good as mine.

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Kurion acquires nuclear to glass cleanup tech

Katie Fehrenbacher — Tue, 29 May 2012 14:43:13 +0000

Kurion, a startup that has developed technology that cleans up nuclear waste and is one of the most successful cleantech firms you haven’t heard of, has been acquiring more cleanup tech. On Monday the startup announced that it has acquired the assets of Impact Services (called GeoMelt), and the licenses from a company called GeoSafe (owned by Battelle), and all this intellectual property covers technology that turns nuclear waste into glass.

That process for turning waste (from nuclear and other substances) into glass is called vitrification, and it’s the widely accepted best practice for how to clean up and store nuclear waste. Kurion already owned some aspects of this technology, and Kurion’s business model is to make the nuclear clean up process more distributed, more flexible and more low cost. Traditionally vitrification has been a more centralized process.

Workers Controlling the Remote Cleaners at Fukushima

Kurion owns another nuclear clean up tech called “ion specific media,” which is a material that basically soaks up nuclear particles in water and liquids and shrinks the materials down to a small enough size so that it can be turned into glass. Kurion used its ion specific media to remove 70 percent of the radioactivity from the waste water at the Fukushima nuclear plant after last year’s disaster.

Winning a seat at the table for helping clean up Fukushima was a huge win for Kurion. It was the only startup involved in the water cleanup process — other firms included France’s AREVA, Japan’s Toshiba and Hitachi-GE Nuclear Energy — and it also dominated the cleanup process.

Four-year-old Kurion is already profitable, is based in Irvine, Calif., and is backed by Lux Capital and Firelake Capital Management.

The GeoMelt technologies were originally developed at the U.S. Department of Energy’s Pacific Northwest National Labs, have been used commercially since the 1990′s and have treated more than 26,000 metric tons of waste, says Kurion. The GeoMelt tech is also under consideration for use at the sizable nuclear clean up site the Hanford Tank Farm.

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Ups and downs for cleantech in Q1

Mon, 16 Apr 2012 06:55:41 +0000

The year 2012 may be remembered in the cleantech space as one of both hope and disappointment. Electric vehicles from the plug-in Prius to the Mitsubishi i to the long-awaited Tesla Model S rolled out, but disappointing sales mean the market may not have caught up to innovation. Acquisitions and investments chugged along in the smart-grid market, with Landis+Gyr’s acquisition of Ecologic Analytics and the anticipation of a Silver Spring Networks IPO that has not yet materialized. Meanwhile the quest for the low-power server continued in the green data-center space with AMD’s purchase of SeaMicro for $334 million. We examine these events and others in this report, which also provides a near-term outlook of trends and companies that will be important to watch in 2012.

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Kurion dominates Fukushima radioactive water cleanup

Katie Fehrenbacher — Tue, 13 Mar 2012 15:23:47 +0000

Nuclear waste cleanup startup Kurion (which I once called the most successful greentech startup you haven’t heard of) says it’s responsible for removing 70 percent of the radioactivity from the waste water at the Fukushima nuclear plant after last year’s disaster. Kurion says, since it shipped its technology to Japanese utility TEPCO last summer, the Kurion system has processed 36 million gallons of contaminated waste water and removed 9.4 million curies of cesium (see graphic below).

Kurion has developed a material it calls “ion specific media,” which basically soaks up nuclear particles and then shrinks the materials down to a small enough size so that it can be turned into glass, which is a process called vitrification. It’s the standard process used by the nuclear industry to encapsulate waste, but Kurion has created a more modular process, so the cleanup technology can be quickly shipped to a contaminated site, then the waste can be safely shipped elsewhere for storage.

Kurion was one of a group of companies selected by the beleaguered utility to clean the seawater that had been pumped into the reactors to cool them down. Other companies that made up the cleanup crew included France’s AREVA, Japan’s Toshiba and Hitachi-GE Nuclear Energy; Kurion was the only startup included. Kurion is a profitable four-year-old, 15-person, startup based in Irvine, Calif., which was backed by Lux Capital and Firelake Capital Management.

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One year later: Fukushima and the Japan cleantech opportunity

Adam Lesser — Tue, 13 Mar 2012 13:00:56 +0000

The one-year anniversary of the Fukushima disaster, which claimed the lives of 19,000 and left another 325,000 without permanent housing, was observed on Sunday. In the wake of the disaster, Japan has reassessed its energy policy, and there’s now a massive cleantech opportunity in the country to create safe and renewable sources of energy fed into a reliable grid infrastructure.

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Silver Spring raises $30M from Hitachi

Katie Fehrenbacher — Fri, 02 Mar 2012 12:48:13 +0000

While smart grid networking company Silver Spring Networks announced last week that it had partnered with Japanese giant Hitachi, more details of the financial deal are now public. According to a filing, and Silver Spring’s latest S-1 amendment, Silver Spring has raised $30 million in an option and debt from Hitachi.

Hitachi is a massive conglomerate with hundreds of businesses, including quite a few in the smart grid like energy management systems, transformers, battery storage technology, and lighting. Hitachi is also working on the Hawaii smart grid demonstration project with a variety of other companies.

Silver Spring, which filed for an IPO last summer, has yet to go public and has been turning to large companies for partnerships and investment. In December the company raised $24 million from storage and IT giant EMC.

For the full year 2011, Silver Spring generated $237.05 million in revenues, up from revenues in 2010 of $70.22 million. The company also generated its first annual gross profit of $22.95 million for the year 2011, up from the gross losses it’s had in the past. However the company continues to generate an annual net loss, and lost $92.36 million for the year 2011, which represented a smaller loss than the $148.45 million it lost in 2010.

Silver Spring also says in its latest amended S-1, that it now has contracts to connect 22 million smart grid Silver Spring-enabled devices, which is up from the 17 million connected smart grid devices it disclosed in December.

Image courtesy of Bernat.

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Startup Kurion says Japan nuclear water cleanup is working

Katie Fehrenbacher — Mon, 29 Aug 2011 03:41:47 +0000

In June, a group of nuclear tech companies, including Silicon Valley startup Kurion, started cleaning the tens of millions of gallons of contaminated water at the Fukushima nuclear power plants in Japan. Now Kurion says the efforts are working, and cesium levels in the water have dropped by more than 40 percent.

Three-year-old Kurion makes a cleanup material (they call it ion specific media) that soaks up radioactive cesium and iodine in contaminated water and contains the waste by shrinking it down to a small-enough size, then turning it into glass, a process called vitrification. The company is backed by investors Lux Capital and Firelake Capital, and is the only American company and startup company to work on the Japanese cleanup efforts.

Vitrification is the standard way to cleanup cesium and iodine in nuclear-contaminated water, but Kurion says it makes that process cheaper, faster and more efficient. Often, the standard vitrification process requires the contaminated materials to be moved to a centralized plant, but Kurion’s process brings the technology to the contaminated materials.

Near of the Sea Water intake of Unit2 in Fukushima Daiichi Nuclear Power Station

Kurion isn’t cleaning the some 90 million gallons of contaminated water on its own. Japanese conglomerates Hitachi and Toshiba, and French nuclear provider AREVA, are also helping to clean the some 90 million gallons. The water was pumped into the turbine buildings at the power plant and wasn’t only contaminated by nuclear materials, but also filled with debris, oil and salt (from seawater).

The group has been working in a haste to clean the massive amount of water. Kurion’s CEO John Raymont told me in an interview back in June that the rainy season just started in Japan, and if the contaminated water overflowed, it could damage the area’s environment even more. There’s also the concern that more earthquakes could occur in the area, which could also cause the water to overflow. Raymont told me that the startup delivered the cleanup material and technology to Japanese utility TEPCO in five weeks, which is a fraction of the time he says it took to start cleaning water at the Three Mile Island accident.

Nuclear waste management is a problem that hasn’t seen a whole lot of innovation over the past few decades. According to some estimates, $1 out of every $4 from the Department of Energy’s budget goes toward nuclear waste management, so there is a sizable opportunity to help the DOE cut that expense. And with the Japanese nuclear disaster, there’s an immediate market.

Images courtesy of Kurion, and TEPCO.

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Infrastructure Q2: Big data and PaaS gain more momentum

Tue, 19 Jul 2011 07:01:55 +0000

Big data and Platform-as-a-Service offerings highlighted the second quarter, suggesting that we can expect to see a shift in enterprise IT practices around application development and analytics very soon. On the PaaS front, we saw new projects like DotCloud and Cloud Foundry gain incredible momentum in just a few short months. The big-data activity ranged from major new Hadoop vendors to heavy investment in flash storage that will speed the serving of data to processing engines. In other areas, we saw an uptick in cloud-computing plans from large vendors, OpenStack continued to mature and pick up both contributors and users, and Facebook caught our eye by launching an open-source project around the designs for its specialized servers and data centers. Additional companies mentioned in this report include VMware, Salesforce.com, IBM, Heroku and Calxeda. For a full list of companies, and to read the full report, sign up for a free trial.

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