Navigant Research Blog

Wärtsilä Acquires Greensmith: Genset Manufacturers Expand Their Role in the Energy Cloud

— May 19, 2017

This week, Wärtsilä announced its acquisition of Greensmith, highlighting a significant trend: generator set (genset) manufacturers are acquiring systems integration and controls capabilities. As this trend continues, the companies are embedding themselves ever deeper into the distributed energy paradigm outlined in Navigant’s Energy Cloud.

Hybrid/Storage Plays

Wärtsilä of Finland is a major global producer of larger reciprocating engines for power generation and marine uses. Yet, genset manufacturers in a variety of segments have been building relationships with storage and controls companies. This strategy can be considered both defensive and offensive in the fast changing genset industry, as explained below. Some specific moves since 2015 are shown in the following figure.

Generator Manufacturers with Publicly Announced Hybrid/Storage Plays

(Sources: Navigant Research, Company Press Releases)

In addition to Cummins, Caterpillar, Wärtsilä, and Doosan, other generator manufacturers, including General Electric (GE) and Aggreko, have announced storage offerings developed either internally or by undisclosed vendors. Most of the above companies also offer solar PV solutions in conjunction with their installations, whether through partners, through distributors, or directly.

There is clear appeal in genset/storage/PV hybrid systems. PV provides clean daytime power at cheapening costs, while gensets provide flexible baseload on demand for nighttime hours and fluctuations in demand. Solar production forecasting, as in the cloud monitoring systems developed by CSIRO, can adjust the operation of gensets to improve integration and save fuel costs (often a significant few percentage points). Storage then provides multiple benefits: in addition to smoothing out PV production, batteries can optimize genset operation, allowing for fuel savings, smoother operation, and sometimes even elimination of redundant gensets.

Defense and Offense

With the latter fact in mind, this acquisition/partnering strategy can be thought of as playing defense—acquiring a backfill revenue source for what may be a declining need for number of systems on any given project. Consider the example presented by Wärtsilä here. Of the six gensets in the “spinning reserve by engine vs storage comparison,” two have become redundant with the addition of battery storage, since the storage provides the spinning reserve formerly afforded by the gensets. If vendors see lower genset sales in cases like these, they may jump at the chance to backfill with sales of controls, storage, or PV.

Apart from its defensive aspects, this strategy also has significant offensive upside. As power production becomes ever more decentralized, genset manufacturers with solid distributed energy resources (DER) strategies will be well positioned to capture market share. There exist major opportunities in microgrids and virtual power plants—indeed, all across the Energy Cloud. As the core technology providers of thousands of legacy microgrids, genset vendors are both driven and well suited to serve a major role in the future of electricity.

 

Transforming the Way We Live, Work, and Move with Wireless Power: Part 2

— May 17, 2017

This post originally appeared on the MIT Enterprise Forum of Cambridge website.

Development of any new technology, particularly one that goes to market in a technology licensing business model, cannot be performed in a bubble. It requires the feedback of users to refine future advances. There simply is no market for a technology that doesn’t provide a compelling value proposition. The development of wireless power is no exception.

As mentioned in part 1 of this blog series, the MIT Enterprise Forum of Cambridge CleanTech Committee brought together a panel of experts to recount this journey from lab technology to commercial product and reflect upon future applications for wireless power. The panel, Transforming the Way We Live, Work & Move, was moderated by Benjamin Freas, principal research analyst at Navigant Research. It included Marin Soljačić, PhD, professor of Physics at MIT and founder of WiTricity; Alex Gruzen from WiTricity; Ajay Kwatra from Dell; and Patrizia Milazzo from STMicroelectronics.

The Partner Landscape

Indeed, much of the panel was composed of WiTricity partners that are helping to deliver on the vision of making a broad range of products truly wireless. Kwatra relayed Dell’s journey through wireless power implementation. Wireless power is not a new concept to Dell; it shipped its first laptop with wireless charging capabilities in 2009. Dell’s vision is to enable true all encompassing mobility by providing a cable-less desk. Wi-Fi introduced freedom from the Ethernet cable, and now the last cord is power.

The first early foray used inductive coupling rather than WiTricity’s magnetic resonance technology. As a result, the laptop required precise placement in order to charge and provided a poor experience. Though magnetic resonance solved this problem, it was not ready for implementation in a laptop. WiTricity relied on input from Dell as it established the efficiency and wattage needed. Dell knows how its products are used and what challenges users face, so it was able to bring this expertise to WiTricity in a partnership to create a viable product.

The Road Ahead

Wireless charging of mobile phones has already reached mass-market adoption and is beginning to appear in laptops and EVs. However, the actual use of wireless power—even in devices that are equipped with it—has been persistently low. Consumer awareness remains a challenge. Current wireless power technology does not provide users with a truly wireless experience.

Nonetheless, the future of wireless power is promising. The increased reliance on electronics and the constant need to power them are driving wireless adoption. Increased awareness and use of wireless power functionality have been generated as a result of the creation of more devices that have wireless charging capabilities and the expansion in public wireless charging infrastructure.

In the future, the expansion of wearable electronic devices and Internet of Things (IoT) devices will further magnify the need for new power solutions. The establishment of public wireless charging infrastructure in locations such as coffee shops and airports is expected to reinforce adoption through the network effects they create. But user experience will be the ultimate driver of wireless power.

 

Microsoft Pushes IoT as a Service as Competition Heats Up

— May 12, 2017

In a quiet way, many different businesses are helping to establish a stronger foothold for the Internet of Things (IoT), moving beyond the hype and delivering on the buzzy promises from several years back. As evidence, Microsoft recently launched IoT Central, an IoT as a service (IoTaaS) offering that enables companies to deploy IoT technologies without having to do so from scratch using in-house resources.

Early Adopters

IoT Central’s goal is to help companies rapidly design, build, and deliver smart products and integrate them with enterprise-scale systems. So far, early adopting companies of IoT Central—thyssenkrupp Elevator, Rolls-Royce, and Sandvik Coromant, according to reports—are in the manufacturing and engineering sectors. IoT Central is part of a suite of IoT-related products from Microsoft, including Azure Suite IoT (a platform as a service [PaaS] offering for developing backend applications) and Azure IoT Hub, which acts as the messaging infrastructure for distributed device communications.

But Microsoft is not alone in helping to establish a stronger corporate foothold for the IoT. Competitors like Amazon Web Services (AWS), Google Cloud, and Oracle, to name a few, offer several IoT-related services for business clients. And recently the head of AWS, Andy Jassy, said, “Of all the buzzwords everybody has talked about, the one that has delivered fastest on its promises is IoT and connected devices.” That’s a strong validation.

IoT and Utility Patents

IoT has also arrived for utilities. A recent piece by Alec Schibanoff, a vice president at patent broker and consulting services firm IPOfferings LLC, notes the many patents for operational efficiency and security that have been granted over the years form the basis of the modern grid. One was granted as far back as 2002.

Next Steps for IoT

These are all signs of a maturing IoT landscape, one that will underpin Energy Cloud 2.0 as envisioned by Navigant Research and outlined in the free white paper, Navigating the Energy Transformation. But there is much more value to be unleashed from IoT devices and connected systems. We’ve only scratched the surface around data analytics, and future applications and services have yet to materialize. Many companies are starting to explore the possibilities. It won’t be too many years before the IoT will make louder noises as a solid platform for business innovation and efficiency.

 

Transforming the Way We Live, Work, and Move with Wireless Power: Part 1

— May 8, 2017

This post originally appeared on the MIT Enterprise Forum of Cambridge website.

Nikola Tesla first experimented with transmitting power without wires at the turn of the 20th century. Until recently, the concept has remained impractical and expensive in everyday applications. Today, the proliferation of mobile phones, electrification of transportation, and impending Internet of Things (IoT) renaissance have translated into a rapid expansion of devices that need electricity. All the while, technological advances have improved the amount of power that can be transferred wirelessly, the distance it can travel, and how efficiently it can be moved, making wireless power a commercial reality.

The MIT Enterprise Forum of Cambridge CleanTech Committee brought together a panel of experts to recount this journey from lab technology to commercial product and to reflect upon future applications for wireless power. The panel, Transforming the Way We Live, Work & Move, was moderated by Benjamin Freas, principal research analyst at Navigant Research. It included Marin Soljačić, PhD, professor of Physics at MIT and founder of WiTricity; Alex Gruzen, CEO at WiTricity; Ajay Kwatra, vice president of Client Technology & Architecture for Dell; and Patrizia Milazzo, Energy & Power management specialist at STMicroelectronics.

The Birth of a Company

For WiTricity, this journey started in 2007, when Professor Soljačić published a paper demonstrating the transfer of 60W with 40% efficiency over distances in excess of 2 meters. The impetus for this research came from a sleepy revelation after Professor Soljačić was awakened by his mobile phone at 3 a.m. The phone beeped when the battery was low. If he neglected to plug it in, it would disrupt his sleep.

Though the use case for mobile phones was clear, the distances and power levels associated with the technology have many more applications. The task of charging is a burden for many devices. For EVs, the act of plugging into a charge creates another friction point that can potentially deter consumers. Similarly, wearables present a charging challenge—they often have unusual form factors that make plugs awkward, yet still need to be charged.

Industrial and medical applications of wireless charging are also emerging. Increased automation in manufacturing has translated to mobile robots on factory floors. These robots need power. Designing a robot to navigate to a wireless charging pad is far simpler than designing one to insert a power cord. Applying this to an operating theater creates the possibility of charging surgical tools after they have been sealed and sterilized, eliminating the need to do so during a medical procedure. This same freedom even enables medical devices that can be completely sealed and powered and charged in situ.

Which Application to Pick?

Wireless power has the ability to transform a diverse range of industries through multiple applications. The challenge for a startup is to narrow down options and focus on a strategy that can be executed. For WiTricity, the best way to change the world was to enable other companies that built products to make their products better by incorporating wireless power technology. This meant a strategy of licensing its technology to partners that create products rather than creating the products themselves.

The initial challenge, according to Professor Soljačić, was attracting talented people to navigate the development of the technology from a laboratory prototype to prolific components of numerous products. Ultimately, WiTricity aims to provide its technology in a simple development kit so that anyone can incorporate it into their design. However, developing this “resonance-in-a-box” solution requires more than technological expertise. It requires the deep understanding customer pain points and the market intricacies associated with specific industries. As Alex Gruzen stated in the panel, “When you are a startup, your customers are partners.”

More to come on the road ahead in part 2 of this blog series.

 

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