by Jeff St. John
September 08, 2017

This week between storms gives us some breathing room to cover grid edge developments beyond grid resiliency and disaster recovery.

Let’s start in Tokyo, where the world’s fourth-biggest utility and its chosen smart metering infrastructure provider are laying plans to expand their efforts beyond tracking kilowatt-hours.

TEPCO and Landis+Gyr look to internet of things 

Landis+Gyr may no longer be part of Toshiba. The smart meter and grid networking giant launched itself as a publicly traded company last month, raising about $2.4 billion on the Swiss stock exchange, and giving its former parent company some cash as it struggles with the bankruptcy of its Westinghouse nuclear power plant unit. 

But Landis+Gyr is still moving ahead with its biggest project in Japan, a 27 million smart meter project with Tokyo Electric Power (Tepco). This week the partners announced 13.5 million endpoints installed, up from 10 million in April, and providing more than 600 million daily reads. With about 500,000 more being added each month, the entire project is expected to be finished by 2020, three years ahead of its original schedule. 

That’s given the partners the confidence to announce a memorandum of understanding this week “to jointly explore the full internet of things (IOT) potential” of the network, which spans smart meters, distribution equipment and other “intelligent devices.” The MOU also “signals a commitment from both parties to cooperate in building an IOT strategy that goes far beyond advanced metering applications to develop other ways for Tepco to monetize their technology investments and open new revenue streams.” 

Landis+Gyr’s network supports Wi-SUN wireless mesh, cellular and G3 powerline carrier, across both neighborhood area networks and home area networks -- a strategy that has required a good idea of technology standards work and hefty node-by-node cybersecurity, but which provides a good platform for expanding services. 

Tepco and Landis+Gyr’s announcement was a bit light on the details, however. “This provides the backbone for Tepco to revolutionize the way energy services are provided and assist their goals for enabling a smart community,” Prasanna Venkatesan, executive vice president Americas and Japan for Landis+Gyr, said in the release. For the newly independent company, it’s an important proving ground -- and one that its competitors are also working on. 

What do cities want from their IOT networks? 

Tepco and Landis+Gyr aren’t the only utility-smart metering partners seeking to leverage the two-way, near-real-time capabilities of the modern advanced metering infrastructure (AMI) network. Silver Spring Networks and New York utility Con Edison are promising similar capabilities, and Itron and hometown utility Avista are building an AMI-plus-IOT network as part of the Spokane, Washington Urbanova project.

Last week, Urbanova announced an interesting effort with a company not usually associated with the energy sector -- polling and analysis firm Gallup. Under the partnership, Gallup will reach out to “key stakeholders” in the project to ask them what public health, infrastructure, economic development, government, transportation and social challenges they’re hoping Urbanova will help solve. 

It will also conduct research on public sentiment on these issues, and “conduct a comprehensive review of existing data sources -- including public and private data that is local, regional and national in scope -- that provide insights for monitoring, analyzing and assessing citizens’ concerns.” 

Partnerships bring U.S. technology to Asia’s metering sector

Tepco may have the world’s single biggest AMI deployment underway, but there are even greater opportunities in the broader Asian markets -- as long as competitors are ready to work with incumbent metering players. This week, Silver Spring Networks announced a new agreement to integrate its IPv6 network interface cards into the single-phase and three-phase meters of Genus Power Infrastructures Ltd., a big smart meter provider in India and Southeast Asia.  

With the deal, Silver Spring-enabled Genus smart electric meters will now be part of several ongoing AMI rollouts. These include India’s CESC Limited for deployments in the Bharatpur and Kota areas, and Singapore Power, which will use Silver Spring-enabled devices to connect additional AMI customers.

All of the big smart meter and grid networking providers are targeting these kinds of partnerships in emerging markets like Asia and Latin America, where per-meter costs need to be lower, and the key business cases often include controlling “non-technical losses,” (i.e., energy theft), as much as advanced applications. 

FuelCell Energy and the search for fuel cell company profitability 

The stationary fuel cell market is dominated by two companies -- Bloom Energy and FuelCell Energy. While Bloom may get most of the press attention, FuelCell Energy has also been making significant strides. In fact, its 39.8-megawatt project with utility Long Island Power Authority (LIPA) announced earlier this year surpasses Bloom’s 37-megawatt contract announced last month with data center operator Equinix and utility Southern Company's microgrid subsidiary, PowerSecure. 

FuelCell Energy’s publicly traded status also provides a level of internal visibility lacking from Bloom. This week, the company reported a third-quarter 2017 loss of $17.8 million on revenues of $10.4 million, compared to a loss of $11.8 million on revenues of $21.7 million in the third quarter of 2016. This poorer-than-expected performance was driven by low utilization of FuelCell Energy’s production facilities that drove down gross margins, Jeffrey Osborne, senior alternative energy analyst at Cowen, noted. 

But FuelCell Energy’s LIPA project, and a newly awarded 20-megawatt sale to Korean Southern Power Company, have brought the company’s backlog to about $1.5 billion, which is important for hitting the sales volume needed to reach profitability, CEO Chip Bottone said in the announcement. 

While we haven’t yet seen a fuel cell company hit profitability, 38-year-old Ballard Power Systems reported positive adjusted EBITDA over the trailing 12-month period ending on June 30, largely driven by China’s appetite for hybrid battery/fuel cell systems for heavy-duty vehicles like buses, trucks and light rail. 

Hackers target grid infrastructure in Dragonfly 2.0 attack

By far the worst hacking incident of the week was Equifax’s report that attackers had gained access to the Social Security and driver's license numbers of up to 143 million people -- nearly half the U.S. population. But we also saw a troubling report from security firm Symantec on Wednesday, warning of another intrusion into power grids by a group of hackers known as Dragonfly.

Starting in 2015, the “Dragonfly 2.0” campaign has been “interested in both learning how energy facilities operate and also gaining access to operational systems themselves,” with confirmed penetrations of power grids in the U.S., Turkey and Switzerland. 

Ukraine was the first country to see a confirmed cyber-assault on its power grid, taking down power in the capital of Kiev for an hour in 2016. Russian-backed hackers have been connected to that attack, and have also been seeking to infiltrate U.S. power plant networks and systems, according to an FBI and Homeland Security Department report last month. 

As with many cyber-intrusions, the attackers gained access to networks through phishing emails that installed malware on end-user devices, as well as harvesting credentials using watering hole attacks.

“In other words, the security posture of the power grids and industrial devices, in this case, were not at fault -- the end user was ultimately at fault,” Lane Thames, senior security researcher at Tripwire, noted in response to the Symantec report. It's a reminder that the “humans in the loop” will “remain the weakest link for some time.” 

FERC nominees commit to fuel-neutral approach to baseload, reliability needs 

This week also saw the U.S. Senate confirmation hearing for the final set of nominees to the Federal Energy Regulatory Commission (FERC) -- Kevin McIntyre, an energy attorney at the large international law firm Jones Day, and Richard Glick, Democratic General Counsel for the Senate Energy and Natural Resources Committee. 

FERC could see a major shift in its role setting U.S. grid and energy market policies under its new leadership. Green energy advocates reacted with alarm when incoming Chairman Neil Chatterjee said in a FERC podcast that baseload power, “including our existing coal and nuclear fleet, need to be properly compensated to recognize the value they provide to the system." 

But this week’s hearings indicated that McIntyre and Glick are maintaining an impartial stance to this issue. “FERC is not an entity whose role includes choosing fuels for the generation of electricity,” McIntyre said in response to a question from Sen. John Barrasso (R-Wyo.), asking if he agreed with Chatterjee’s views. 

And Glick cited the recently released Department of Energy report on grid reliability, noting that the ongoing retirement of coal and nuclear plants has not yet led to a less secure grid, although “it was something to keep an eye on and look for in the future.” 

Microgrids for storm resiliency 

As Texas continues to struggle in the wake of Hurricane Harvey’s destruction, and Hurricane Irma thrashes the Caribbean and threatens Florida, microgrids are getting increased attention as a bulwark against the power outages that can hamper storm recovery efforts. 

The New Jersey Board of Public Utilities has been spending the week touring several proposed microgrid sites across the state.

The Town Center microgrid in Cape May, centered on a wastewater treatment plant with a biogas and natural-gas-fueled combined heat and power system, will power police and fire academies, the county jail, health department and road and bridge department, and a National Guard armory.  

And the township of Galloway is evaluating fuel cells, energy storage systems, solar, combined heat and power, thermal loops, and water exchange systems for a microgrid that would service the town hall, police station, medical center, schools, and a local grocery store. It’s important to note, however, that New Jersey has provided a total of $2 million for feasibility studies for 13 separate projects, which adds up to just enough money per project to plan it, not build it.