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5 Questions for Cisco's Smart Grid Guru

Cisco (s CSCO) sees a $20 billion opportunity in the smart grid, and while it may have gotten off a bit late to the party, it’s crashed it in a big way. The networking giant wants to deliver products and services that span the grid, from home and business energy management to a secure, IP-based network to control substations and distributed energy resources.

Cisco is working with big utilities like Duke Energy, Florida Power & Light, Germany’s Yellostrom, and Canada’s Enmax, and its vendor partners include General Electric (s GE), Accenture (s ACN), Oracle (s ORCL), Arcadian Networks, Itron (s ITRI), Landis+Gyr, Siemens (s SI), Schneider Electric and Verizon (s VZ). It also has its EnergyWise platform for controlling building and data center energy use, which could tie into smart grid networks in the future. CEO John Chambers has described the IT giant’s budget for smart grid as ”unlimited.”

Laura Ipsen, Cisco’s senior vice president of smart grid, will explain the company’s standpoint to you at our Green:Net conference on April 29. We spoke to Ipsen last week to see where Cisco stands in its smart grid ambitions, and what to expect in the coming year.

Q). Cisco said it planned to bring smart grid devices to market early this year, but we haven’t seen much yet. What can we expect from Cisco, and when, in terms of announcements across its smart grid target areas?

A). We’re pretty excited about how we’re going after this market. We have a build-buy-partner model, and I think you’ll see some things soon. We have an engineering team coming out with product you’ll see coming out in late summer or early fall that we’re testing with customers now.

The one thing we know about utilities is that planning and framework and testing and piloting are pretty important in advance of deployment. If you look across the country, the horizons on smart grid range from things that will happen in the next two to three years, all the way to 10 to 20 years to full deployment.

Q). EnergyWise, Cisco’s new building energy management system, could be linked with smart grid systems. When will the two be connected?

A). EnergyWise is software we have in our switching equipment. When we launched it, it had open APIs and we want everyone to develop around that. We have some strategic partnerships with IBM (s IBM) and Tivoli, because we feel this is software we can leverage across multiple areas of IT, and ultimately non-IT, we’d like everyone to leverage EnergyWise, to build to it, whether you’re a partner or a competitor — Eventually going all the way to data centers. The utilities are getting ready to mange a lot more data flow than they’ve handled in the past, ultimately 10 to 20-fold from the past.

Q). What new developments are underway with your “Smart Grid Ecosystem” partners, whether in on-the-ground projects or in development?

A). The ecosystem was really an opportunity we have to say, let’s get on the same page and look at this market, and the importance of all the variety of partnerships we included was all about working on interoperability, IP and being open. We’re tackling some tough issues about intellectual property or security.

We do believe there are some areas of the ecosystem we’d like to add that are important to the future of smart grid. It probably includes adding some expertise on security – we have our experts, but we’d like to work with others in security as well.

Q). Cisco recently invested in Grid Net, a startup specializing in WiMAX. At the same time, Cisco has recently said it will quit the WiMAX radio access network business and will cease making WiMAX base stations. How do these two moves compute?

A). I don’t think that Cisco is turning our back on WiMAX. I think in the future we’ll still work towards WiMAX, but it will be through partners and licenses. It’s a very compelling technology in many parts of the world.

With Grid Net, what we find very interesting is their platform approach and how they’re driving IP, With the greater abilities of bandwidth at their head end system, we think it provides a very robust platform. It’s very interesting from where we see the future going, an IP-based and open approach. We’ve made a decision to invest and will make a decision on how we’ll work with them in the future.

Q). What other investments might Cisco be planning in the smart grid space?

A). We’re looking across the landscape, from (electricity) generation to consumption. I think you’ll see us make additional investments whether it’s an investment like Grid Net, or in the acquisition space. First and foremost, in spaces where our customers from an architecture approach are looking for technology. We will either build it, accelerate it through partnerships, or acquire it.

There’s a lot of play in AMI (smart meters) right now. But as utilities scale and as intelligence permeates the utility, we think that distributed intelligence need to be there to support a truly smart grid. We hear from all the utilities, AMI and metering is not a smart grid, it’s a starting point. Now utilities are asking, what kinds of networks do we need to create a truly smart grid, with a lot of focus on distributions automation.

7 Responses to “5 Questions for Cisco's Smart Grid Guru”

  1. Annemarie Dammann

    “Utilities often pilot things to death and use that as an excuse. One of the reasons NARUC set up the Smart Grid Collaborative was to act as a clearinghouse, so every utility doesn’t have to reinvent the wheel.”
    Frederick Butler, NARUC

    I love this guy: )!!!! Seriously have a TON of respect for Mr. Butler . . . in researching his positions/statements it’s obvious he knows his stuff. And is interesting without all the fancy talk. I definetely recommend reading the rest of this article- lots more good stuff: )


    Smart grid is described as a more efficient, less costly than moving electricity over transmission lines for long distance power lines and local end-users in homes and businesses.
    Investments will take place in entire power system at home, in buildings, campuses, neighborhoods in cities and across continents. Already we see some of these improvements.

    But while there is the injection or the hope of public Money, the Utilities will not put their own Money in the development of Smart Grid.
    They do not do it for meanness, but by survival instinct, not worth pushing pushed they will not.
    Below are some reasons for this.

    The old meters have survived until today because of their longevity and reliability – some more than 50 years of useful life.
    New Smart Meters being installed now have a useful life of around 10 years, its
    fragility – components and packaging – and in some situations, the hostile environment where they will be installed, will determine its useful life.
    The Utilities will wait awhile to see the performance and new developments of the manufacturers of Smart Meters.

    Here the variety of options is so many, vendors and developers, will have to reach an agreement without waiting for the Regulatory Agencies take the initiative.
    The good side of this situation, is that the set of players are more accustomed to this kind of problem, because diversity is one of the main characteristics of their businesses.

    How will the integration of renewable energy – wind and solar – in the system.
    Will be made in transmission lines separate or integrated the existing lines, we should be aware that renewable sources are intermittent, so its monitoring will involve sophisticated solutions management and distribution.
    What happens if the wind stops blowing during the hottest days of summer, our current system electricity grid is poorly suited to manage variability of new sources of electricity. Solving the transition to new energy sources is only half the battle. After generating the power, you need to distribute it to where it is needed at the right time, in the right quantities.

    Some consumers have great difficulty in understanding Special Rates, Demand Response and Peak Time. But consumers will be able to access these data so they can make adjustments in their consumption of energy. The cost of these meters is very high and is passed on to consumers.
    The hope is that once consumers have access to information on their consumption of electricity, they will take steps to reduce electricity consumption to offset the cost. This raises the question of whether there is a compromise between cost benefit out of the most investments to achieve the goal of an intelligent net work.