Photo: Courtesy of ENBALA

Smart Grids Generate Powerful Trade

Numerous Canadian companies have powered up to create innovative technology for smart grids and are seeing sales surge in foreign markets. Here’s the buzz on a few of them.

It improves data about electricity usage, pinpoints power outages, reduces electricity theft and more.

It’s called the smart grid and includes everything from the home installation of smart meters that provide energy usage data to electrical utilities and homeowners alike, to software that allows industrial and commercial users to reduce their energy during peak periods.

The smart grid “is really about grid modernization with new technology,” says Jim Burpee, president and CEO of the Canadian Electricity Association.

Burpee says the addition of new communications and automation equipment to power lines makes it easier and more effective to control the grid, restore power after outages and to plan more effectively.

STRONG TAILWIND

Photo: Courtesy of Clevest

Photo: Courtesy of Clevest

The smart grid “has been the wind in our sails,” says Thomas Ligocki, president and CEO of Richmond, B.C.-based Clevest, which makes mobile workforce products that help install smart meters and its next phase—mobile applications for the smart grid.

Clevest initially began making smart grid support products in 2006 out of a basement with six people, and now has 124 employees. It’s growing so quickly that it was recently named Canada’s sixth fastest growing company by Profit Magazine.

Clevest’s software allows workers installing smart meters to determine whether they are operating correctly and to diagnose them if not.

“We had the fortune of being able to create innovative technology that could serve a new market and we’ve been able to ride that wave,” Ligocki says.

More than 130 utilities have bought into Clevest’s solution and almost all are abroad—only seven per cent of business is in Canada.

The United States comprises about 70 per cent of exports and China about 20 per cent, with Latin America, Europe, Australia and the Philippines making up the remainder.

To bulk up U.S. sales, the company has a five-person office near Dallas, Texas and a travelling salesforce in nine regions of the country. “That gives our U.S. clients a level of comfort,” says Ligocki, who has encountered a desire to buy locally among some potential clients.

However, having products with unique features and developing partnerships with U.S. firms has helped overcome that stigma, he says.

Ligocki says EDC has helped Clevest find new clients, namely through a recent matchmaking session organized by EDC and the Department of Foreign Affairs, Trade and Development (DFATD), which brought six of Colombia’s largest electricity companies to Vancouver (and Toronto).

“While our sales team had met with some of those utilities, having them come here added a lot of credibility to us as an organization. They need to see us in our element and know there’s a large organization standing behind us.”

Clevest recently added an Android application to take advantage of the popularity of the operating system in inexpensive mobile devices in developing countries.

It’s also aiming to launch a theft analysis and prosecution solution system next year that Ligocki believes developing countries will be eager to embrace.

REDUCING THEFT AND FRAUD

Photo: Courtesy of Awesense

Photo: Courtesy of Awesense

Indeed, electricity losses from theft, bill fraud, meter tampering and equipment failure are among the industry’s most persistent problems.

“It’s a huge problem in emerging nations,” says Mischa Steiner-Jovic, CEO of Vancouver-based Awesense. In Brazil, for example, losses are around 30 per cent and that number can reach 100 per cent in parts of India and Pakistan, he says.

However, Awesense has “built a system that can easily identify where losses are occurring, without having to implement billions of dollars of fixed infrastructure within the grid,” says Steiner-Jovic.

The company’s SenseNet system is designed to help utilities cut power losses and recover lost revenue from theft, transformer overloads and other problems.

It has helped clients recover tens of millions of dollars in avoidable power losses and led to the company being nominated a smart grid company to watch in 2013 by Smart Grid News.

By analyzing small chunks of the distribution grids, the technology allows utilities to zero in on where their losses are occurring. Previously they could only guess where these were happening.

Awesense revenues are up about 300 per cent compared to last year and its employee count increased from 5 to 20, divided between a Vancouver office, Richmond, B.C. manufacturing facility and Kelowna, B.C. lab.

The goal is to obtain about 200 per cent growth annually for the next several years.

Like Clevest and 20 other Canadian suppliers, Awesense participated in the EDC-DFATD matchmaking session with potential Colombian clients.

Steiner-Jovic has since had follow-up meetings in Colombia. He now plans to use EDC accounts receivable insurance and to hold discussions with EDC’s investment arm about financing.

Steiner-Jovic made use of business contacts to get started in exporting, with its first export sales to ELO Sistemas Electronicos of Brazil. “The losses in their grid are substantial,” he says. “It’s a solution Brazil desperately needs and a great fit for us.”

That Brazilian sale allowed the company to gain traction abroad, with Latin America now Awesense’s largest export market outside the United States.

Sales have been boosted by policies in Latin American countries that are aimed at decreasing grid loss. That’s in sharp contrast to Canada where, with the exception of B.C., provincial utilities pass losses onto users.

“Since the utilities are guaranteed they will not lose money, they have little motivation to do anything about the problem. That’s why we’ve gone internationally.”

Exports represent less than 20 per cent of Awesense sales, but Steiner-Jovic expects substantial growth to come from Eastern Europe, as utilities aim to make distribution grids more efficient.

ENSURING ENOUGH POWER

Another way to increase efficiency is by ensuring that electricity utilities and grid operators have the right amount of power every second of the year to meet continuously changing demand. This ensures electricity users have power when they need it.
This constant balance of supply and demand is becoming increasingly challenging as demand patterns change and the supply mix includes rising levels of intermittent renewable energy generation.

That’s where ENBALA Power Networks comes in. The company has developed smart grid technology that connects and engages large industrial and commercial electricity users to its GOFlex platform, creating a network of electricity customers that help balance the grid.

“The idea is that if we could get them (electricity users) actively involved in supporting the management of the power system, we could make it operate more efficiently and less expensively,” says Ron Dizy, president and CEO of ENBALA.

ENBALA offers grid operators and electricity utilities the unique ability to vary the amount of power in their grids every few seconds. In return for accepting these variations in electricity, large users are compensated by ENBALA.

ENBALA has 40 employees split between Toronto and Vancouver, with a few sales personnel in the United States, which accounts for 20 per cent of its sales. Revenues have been growing 50 per cent annually since 2011.

EDC provided equity financing to ENBALA in 2010 and 2012. Enertech Capital, a fund EDC invests in, is also a lead investor in the company.

“In addition, EDC has added value that is distinct from conventional venture investors by trying to find ways to introduce us to export markets,” Dizy says.

Dizy expects the company to expand to Europe by 2015 but is currently focusing on North American opportunities.

In the U.S., “we’re generally known as the people who supply real-time flexibility to grid operators and electricity utilities by managing demand-side loads. They’re often surprised we’re from Canada.”

4 SMART EXPORTING TIPS

  1. Hire employees who speak the language of the market you’re courting. This provides buyers with confidence that someone can help them in their language, says Clevest’s Ligocki, who has Spanish-speaking employees dealing with clients in Latin America.
  2. Consider partnerships in foreign markets. It’s easier to have a partner who understands the local culture than trying to figure it out yourself, ENBALA’s Dizy advises.
  3. Mention the availability of EDC services to potential foreign clients (such as buyer financing). “When you’re a startup, having a large organization that’s willing to stand behind you is very important,” Ligocki says.
  4. Budget more than you think to court export sales. “Take the number you think it will cost to pursue that new market and multiply it by two or three,” says Awesense’s Steiner-Jovic.
Categories Clean Technologies, Technology & Telecom

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