Commercial, Demand Management, Distributed Energy Resources, Energy Efficiency, Energy Storage, Industrial, Commercial, Finance, Industrial, Solar - June 22, 2016 - By Amy Poszywak
Views from the top: GE on how energy as a service can transform the C&I sector
A Smart Energy Decisions exclusive
Current, the energy management startup recently launched by General Electric, has spent the past few months making headlines in the energy space with numerous acquisitions and product launches. While the company has thus far been known best in the commercial and industrial sectors for its lighting as a service offering, Current's mission goes far beyond LEDs; The company's vision combines renewable energy generation, energy storage and electric vehicle infrastructure into a sustainable energy ecosystem for customers.
Dave Bartlett, Current's chief technology officer, has spent much of his career focused on smart solutions for C&I companies, and believes digitally enabled infrastructure can create opportunities for companies that go far beyond energy efficiency. Bartlett, who was previously responsible for architecture, strategy and evangelizing smarter planet solutions around buildings, cities, and industries at IBM, is also self-described as an evangelist and speaker for "the Industrial Internet of Really Important Things."
Smart Energy Decisions recently spoke with Bartlett about the future of the energy as a service model and how the internet of things can transform U.S. businesses. The following is an edited version of that conversation.
Smart Energy Decisions: You have a lot of experience in different realms of the internet of things, or IoT, and buildings, so looking at that from the specific focus of energy services and how all of those things mend together at GE and Current, we're really interested in hearing your perspective on the energy services industry and specifically the energy as a service model?
Bartlett: I think more than ever, energy as a service and how we create intelligent environments are coming together, and it's what makes it such an exciting space. And it's an exciting space that is achievable now, more so than ever. So why now? As you know, we've had a lot of advances in distributed energy technologies that are driving down the costs of renewables and storage, and you couple that with the state-of-the-art — in terms of technology — software platforms, the ability to pull large amounts of data, and persist that data across networks, all happening with the right economic model, too. Of course part of those technologies are the IoT technologies, the cloud technologies, and people looking at these disruptive business models that we've seen drive astonishing success in some sectors like hospitality and transportation, etc. So energy as a service is enabled by all of this. So it's driving us toward this point where we really can transform, and it helps our commercial and industrial customers to rethink how they can really transform in the sense of reducing energy use in a far more intelligent way while producing energy themselves and shifting their business models to optimize for those best outcomes.
So at Current, we're really betting on energy as a service to be a solution for the C&I world. It's a world where energy infrastructure not only helps us optimize how we use energy but really unlocks a world of digital-centric outcomes outside of energy as well. To really pull this off, you have to have a much greater sense of what's happening in the environments, and we're able to get that from things like lighting, and so that's a big push right now within Current, the LED lighting conversion. As— this is a natural time to do it, and while we are doing that, we're putting in a platform of sensors that literally can see, feel, hear, touch all kind of data. So it's really helping us holistically to drive deeper energy improvements based on really understanding what's happening in an environment, but the data we pick up, again, allows all kinds of outcomes or solutions that we can drive outside of energy as well. We also see this role of the person responsible for energy, too, moving forward in an exciting way.
The evolution of software and data analytics is a big piece of what has enabled this energy as a service model as well as the evolution of how energy managers are looking at their roles. What do you see as the key role of software and data analytics in the energy as a service model?
The key role, or the secret sauce, if you will, is in the data that we're getting from these fixtures. GE, of course, being a leader in LED transformation, GE has been leading the way with a state-of-the-art platform, cloud-based platform, that's literally focused on industrial applications. There are a lot of other platforms out there by other providers, but they're been built for more of the e-commerce type applications. What GE knows really well is the industrial world, power systems, lighting systems, jet engines, medical equipment. So how do we really connect with those types of machines that now have all this intelligence and sensor ability, bring in into a software platform like Predix and be able to sample it in real-time, so that it's time-series based data sampling, and combine it with everything else we know about where the light fixtures are, and other information, so that you begin to build an awareness of the environment beyond the lights themselves, the energy usage, and start to understand what's happening in that environment. The Predix platform allows you to do this at scale, because we're talking about exponentially more light fixtures out there than there are smart phones for example, as a platform for data and sensors.
Then comes the analytics piece, becausefrom it. So analytics that can run on the edge, because there's so much data coming out of these systems that if we push it all into the cloud, that can become problematic. So it's really, the art of big data is really understanding, what's the least amount of data you need to send to the cloud and what can you act on in real-time, right where the data is being received, for better response. Whether you're responding to shifts in occupancy, or shift in some security sense that you've got, that's all really critical. So our Predix platform really provides a catalog of analytics, so that the application software providers that we work with that really have great expertise in environments like retail, can not only export their applications to the environment, get that extra data from our light fixtures, but also use our catalog of analytics to enhance the analysis that they're already doing.
You mentioned retail as an example of a sector where Current is working, and the announcements made by the company thus far about your clients have thus far, companies such as J.P. Morgan, Hilton, Walgreens, those are all on the commercial end of the isle. Do you have plans to use this model on the industrial side? Are there opportunities in manufacturing and other industrial situations?
Absolutely. We have partnered with folks like Intel and Trane thus far, but we do have applicability, really, in every commercial and industrial setting.. We've seen a huge interest from manufacturers on how this can drive value in the factory as the big initiative in that setting is digital thread. Understanding, as a product goes from design, out on the manufacturing floor, and intersects with the supply chain and being able to track that back and understanding what environments something in manufactured under and then checking it as it goes out into the field and being used, that's the whole digital thread that digital story of the part. That enables you to do things like respond quickly to events that happen in the field and track it back to manufacturing or supply chain.
In talking with your clients or potential clients, what is the biggest challenge you see businesses are facing when it comes to energy management or energy services in the context of the internet of things and this whole new wave of technologies?
In the energy space, I think a lot of the commercial and industrial customers have established a lot of good practices in kind of the first generation play here, such as being able to better do set point management and really do a better job of understanding what's happening in their environments, building their first [condition monitoring systems] and things like that. Those things drove great returns, but this next generation that we're talking about, and one of the reasons we started Current, was really to shift beyond scheduled maintenance and set-point management to being able to holistically monitor everything. Again, through the use of fixtures and this ubiquitous set of data points. You can imagine in a retail environment, understanding things like humidity and temperature across all the cold and hot isles and garden centers and everything, and then understanding customer movement and being able to change lighting and being able to change temperatures based on what you're selling and where the people are. If you want them in a certain part of the store, brightening the lights, if you want them to buy winter coats, keep the temperature lower. If you're trying to sell bathing suits, make it warmers.
There's just this dynamic understanding of what's happening in the environment and being able to work very quickly. They want to know how you do that effectively. We want GE to be the easy button in helping customers do that, because the opportunity is there to save that next additional percentage of energy that we think is easily another 10% to 15% in energy. But we don't want to do it through implementing something that's very complex, or something that is looking for an ROI that is way off in the future tied to use cases. So doing it with the lighting, the lighting platform is the platform for technical innovation because you get a payback right away with the energy savings, while you get that expanded set of sensors that you can build next generation use cases on to do some of these more innovative projects. So lighting is how we kind of help customers step through to get to this next generation of savings, but the next generation is also about how you take advantage of distributed generation technologies and doing that efficiently. So when I say
Are you able to customize the financing for Current's lighting as a service offering?
GE has been going through its own transformation with its capital group, so we're been able to get some of the best talent for GE Capital, and people just focused on this space with us. They're lending all their creativity and resources from GE behind [Current] to really understand what type of models are available in the market. That's why it's so exciting to be in this space with GE, we have these great assets like LEDs, storage, electric vehicle charging, we've got the software platform that GE has invested over a billion dollars in since its inception in 2011, and then you've got the whole financial, 'how do you fund this thing?' part, and all of it plays together in helping us figure out how to deliver the most cost effective, efficient services today and in the future.
You personally have a lot experience with buildings and learning to listen to buildings in order to drive efficiency, so we were wondering what your vision is for the future of a smart building, particularly as it relates to energy efficiency and renewable energy integration and how those two elements can or will play together?
It's really exciting. One area I have been looking at a lot is energy trading on a distributed model. So if you look at some of the new technical innovations like block chain, which is all about how to secure a transaction with complete 100% transparency over the internet. A lot of the buzz around that was around Bitcoin and things like that but the basic algorithms are all about trusted transactions. So imagine, you have a store or business in a certain neighborhood or part of the country or city, and you're creating energy through solar panels and you end up having excess and you've stored all you can store. So you want to trade that energy, but the thing about energy is the farther it's pushed, the more you lose, so for transmission and distribution that's the big challenge. So coupling block chain technology with creating your own energy enables you to trade very closely to your neighbors, whether it's residential or commercial or industrial. So you loose a lot less in the transmission, so it's far more efficient and you're assured that what we're getting is truly renewable, clean power, so you really have great viability. So I think of this as the equivalent of the slow food, local food movement, only in this case it's for electrons.
The other thing that is transforming is that this first generation of energy management systems really helped building managers and energy managers do things more efficiently and with less people, but I think this next generation is going to enable us to make people that work and use these facilities far more efficient. Because how we apply energy, coupled with this new contextual awareness that we get from this ubiquitous set of data from sensors really helps us apply energy in a far more task-oriented, effective way. So really shifting from asking 'okay, how do we make the building managers more efficient and help them do their job better and save money?' to 'okay, how can we boost the productivity of those that are living and working and benefiting from those build environments?' And there is exponentially more value that can be achieved as a result of that, so what's happening is that the energy manager or energy czar all of a sudden moves from controlling energy to really controlling productivity.