Navigant Research Blog

Innovators Wanted for DER Solutions: Part 2

Laura Vogel — September 21, 2017

Coauthored by Brett Feldman

Earlier this year, Navigant Research blogged about innovations required to overcome challenges to widespread distributed energy resources (DER) adoption and integration. This blog highlights examples of companies and products looking to address those gaps from different perspectives, with varying levels of success so far.

Hardware

 Tesla’s recent innovation in solar PV is the Solar Roof system, a glass solar tile product for homes that has a warranty of the lifetime of the house. The Solar Roof can also integrate with the Tesla Powerwall home battery. The out-of-pocket cost for a typical home in Maryland is estimated at $52,000 (pre-tax credit), but Tesla estimates that the system could earn a modest return of $8,000 over 30 years after, accounting for the tax credit and the value of the energy generated. Customers can choose to finance their Solar Roof through their home mortgage. The Solar Roof is a hardware solution that has the potential to increase the life of residential solar PV installations, improve the value of a home, and be more attractive to customers. However, the Solar Roof rollout appears to be moving slowly, with customer installations about to start and then ramp up through 2017. And as with many hardware innovations, price can be a barrier. Various analysts, including those at GTM, calculated a cost of $6.30/W, which is approximately double traditional solar PV prices today. Additionally, there may be complications for building-integrated PV receiving the federal Investment Tax Credit.

Software

In 2016, Tendril launched a new cloud software product called Orchestrated Energy, a residential continuous demand management solution for utilities that calculates a home’s heating and cooling needs, predicts customer behavior, and integrates connected devices to optimize system operation under a unique dispatch schedule. In pilot programs, the software solution reduced HVAC peak load by up to 50% and energy consumption from cooling by up to 20%. The solution is scalable and device-agnostic, and customers can interact with it via Tendril’s MyHome mobile app. The Orchestrated Energy software solution innovates by providing a seamless, optimized customer home energy management experience. Interestingly, there remains some doubt in the industry as to whether utilities are ready for this advanced software.

Platforms

Current, powered by GE is a startup within GE that offers advanced energy technologies—primarily combining LEDs and solar with networked sensors and software—for commercial and industrial facilities. It offers a single-source platform for energy management across multiple client sites, leveraging GE’s Predix, the cloud platform for all of the company’s Industrial Internet applications. Notably, Current has 125 plus partners providing apps for a variety of enterprise and municipal services (e.g., workspace/productivity management, asset management, and urban mobility/traffic planning) as add-ons to its Intelligent LEDs and the Predix Platform. In August 2017, Current announced a deal to install solar on 50 Home Depots in the United States in partnership with Tesla. Current has also partnered with AT&T to sell Internet-connected sensors to cities as a smart city infrastructure solution. San Diego was the first major city to sign on. The ability to leverage GE’s hardware and software is a strong starting point for the business, but the company has struggled to clearly define a strategy. In December 2016, GTM reported that Current is undergoing restructuring.

In the next installment, we will lay out other solutions related to business models, strategic relationships, market structures, and regulatory models.

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