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by Jeff St. John
September 14, 2017

The internet of things is a term made up of equal parts hype and reality -- hype about the possibilities of billions of devices communing to make work safer, more productive and more profitable, and the reality of slow and uncertain progress. 

Gartner reports that the number of connected things in use worldwide has grown 31 percent to 8.4 billion from 2016 to 2017, with nearly $2 trillion in total spending on endpoints and services. But of that figure, 5.2 billion devices are consumer items -- Fitbits, Alexas, and the like -- while the number of vertical-specific and cross-industry devices add up to just more than 2 billion.  

Verizon’s third annual State of the Market: IOT Report, released this week, provides some important data on how these industry-specific and cross-platform IOT networks are being deployed, including a breakout section on how energy and utility companies are using IOT. 

According to the report, the sector saw a 41 percent boost in IOT network connections between 2016 and 2017, adding up to $66 billion in investment. That’s a brisk growth rate, but nothing close to the estimated $183 billion in spending from the manufacturing sector, and a bit less than the $85 billion spent on transportation-related IOT.

And just because all these devices are out there doesn’t meant they’re being connected at an enterprise level. “Most enterprise IOT projects are in the proof of concept or pilot phase, not in production,” Verizon warned, citing a McKinsey report on sector trends released in May.

At the same time, that McKinsey report found that IOT could yield a global economic benefit $3.9 trillion to $11.1 trillion a year by 2025 -- a huge figure that actually exceeds the hype on the topic, the authors noted.

The majority of that value was in the category of "factories," with $1.2 trillion to $3.7 trillion to be gained through better operations management, predictive maintenance, and other IOT-enabled tasks. 

Still, as Verizon noted, the past 12 months or so have brought real incremental progress, such as “simplified end-to-end solutions, low-cost IOT technologies and connectivity solutions, and new regulatory requirements around food safety, pharmaceuticals, energy and the operation of commercial drones." 

Along with every heavyweight telecommunications and technology provider out there, Verizon is planning to make money on the trend. Just as Apple has HomeKit, Google has Cloud IOT Core, IBM has Watson and Cisco has Jasper, Verizon has its “ThingSpace IOT ecosystem” for customers’ enterprise machine-to-machine data. It includes industry-specific machine-to-machine capabilities like its “Intelligent Track and Trace" platform, with GPS location and temperature monitoring. 

The guts of the IOT network are also improving, it notes. The Category M (Cat-M) connection modules that support its low-cost commercial IOT network have “dropped to a fraction of the cost they once were,” with “extended battery life and support use cases not connected to external power sources -- everything ranging from water meters to asset trackers to consumer valuables.”

Verizon has also been acquiring companies to bolster its IOT business, like Skyward for drone operations, Telogis and Fleetmatics for fleet and mobile resource management, and Sensity Systems for networked LEDs and controls. 

IOT for energy: Navigant ranks the networks and streetlights from Silver Spring and Acuity 

As for the energy sector, Verizon’s report touts its Grid Wide Solutions platform, a soup-to-nuts device, network and cloud computing package for utilities to deploy smart meters, grid sensors, and other grid edge systems. It’s interesting to note, however, that Verizon still hasn’t been able to get any of its utility customers to name themselves as such.

This week’s report cites only an “electricity distribution utility” using its meter-to-cloud platform -- the same anonymous news that accompanied the business launch in 2015

Meanwhile, Verizon’s concept of a hosted smart grid is being emulated by the rest of the world’s big telecommunications providers, as well as the incumbent advanced metering infrastructure (AMI) vendors. This week, consultancy Navigant released its leaderboard ranking of vendors for low power wide area (LPWA) networks that make IOT possible. 

According to its ranking, Nokia is the leader in “execution and strategy of LPWA for power utilities,” ahead of AT&T, Ericsson, Huawei, and Verizon on the telco front, and Trilliant, Silver Spring Networks and Itron from the AMI side of things. Criteria included “vision, go-to-market strategy, partners, technology, distribution, reach, product quality/reliability and more." 

Utilities are often the owners -- or at least operators -- of streetlights in many U.S. cities. The LED streetlights going in today are easy to network and operate intelligently, making them the second biggest single endpoint out there beyond smart meters. On this front, Silver Spring Networks has long been a leader, helped along by its acquisition of Streetlight.Vision and big rollouts in the U.S. and Europe

On Wednesday, Silver Spring and Acuity Brands, one of the biggest specialty LED lighting providers out there, launched a partnership that could expand the reach of its networks and underlying smart city applications. Acuity’s field sales teams will sell Silver Spring’s technology as part of its turnkey offering for large-scale customers including utilities and cities. 

Data on post-Hurricane Irma power restorations -- and grid investment values

More than 6 million people were left without power in the wake of Hurricane Irma’s devastation of Florida and Georgia, a record-breaking level of grid destruction and damage that’s triggered a massive utility response. And while the worst-hit areas may have to wait a week or more for electricity to be restored, the states’ utilities have managed to bring millions more back on-line. 

Florida Power & Light reported that, as of 8 p.m. Wednesday, it had restored electric service to more than 2.7 million customers in the first 48 hours since the storm departed its territory. More than 21,500 personnel are working to restore power to the approximately 1.7 million customers who remain without power. 

FPL also noted that the nearly $3 billion it’s spent over the past 11 years on grid-hardening and reliability appears to have paid off. “Our hardened main power lines appear to have performed 30 percent better during Irma than non-hardened ones,” CEO Eric Silagy said in Wednesday’s statement. Only about 2,000 poles are down this week, as opposed to the nearly 12,000 poles damaged during Hurricane Wilma in 2005, he noted.

FPL has also invested in training its restoration workforce, improving the logistics of replacing thousands of poles and transformers and hundreds of miles of power lines, and other preparations, he said. The result has been a pace of service restoration about four times faster than after Hurricane Wilma, he said. 

Meanwhile, Georgia Power reported that it had restored power to about 830,000 customers as of Thursday morning, with 155,000 remaining to be restored. Initial damage estimates from Hurricane Irma included more than 1,000 broken or damaged power poles, about 350 transformers damaged, and nearly 200 miles of wire, and as in Florida, “restoration teams continue to face challenges including downed trees, blocked roads and bridges that had to be inspected by the state following flooding.”

Both utilities are tapping the tens of thousands of workers from the U.S. and Canada who’ve arrived as part of a national mutual assistance network. Georgia Power also has the broader resources of parent Southern Company, and is expecting to have 95 percent of customers in cities such as Atlanta, Augusta, Athens, Macon and Savannah restored by the weekend.

Funding roundup: Ampt, Powerhouse Dynamics, Solid Power

This week's Solar Power International conference is the place to drop news about major funding and new partnerships, particularly if you're a DC string optimizer startup trying to gain market share. On Wednesday, Fort Collins, Colo.-based Ampt announced it raised $15 million in additional funding from strategic investor and founder Doug Schatz and long-time investor Bohemian Investments, bringing its total funding to $50 million. 

Ampt makes string DC optimizers for commercial and utility-scale PV systems, where it competes with the incumbent string inverter heavyweights like ABB, SMA and Fronius, as well as other optimizer providers like Alencon. In the residential market, SolarEdge has taken the lead from struggling Enphase, while Chinese giant Huawei is planning to launch a DC optimizer with string inverter product next year. 

Like the rest of its competitors, Ampt is using the opportunity of SPI to announce some other big wins, like its partnership with Ingeteam, aimed at repowering older renewable plants, and its deal with Rosendin Electric to upgrade a solar system at Arizona Western College. 

In the building energy controls sector, startup Powerhouse Dynamics raised $2 million, according to this filing with the U.S. Securities and Exchange Commission, bringing its current round to a total of $7.4 million.

In covering an earlier $2.6 million investment in February, we noted that Constellation Energy and Ingersoll-Rand were investors in the company, which makes hardware and software to monitor energy at fast-food restaurants, stores and other small commercial sites -- a tough market for energy management. Competitors in this space include existing HVAC and power controls vendors that are building more intelligence into their devices, demand response providers like EnerNOC (now owned by Enel), and startups like BuildingIQ, GridPoint, EnTouch and PlotWatt.

And on the energy storage front, A123 Systems (the part of the bankrupt U.S. lithium battery maker that’s still owned by China’s Wanxiang Group, not the energy storage part owned by Japan’s NEC) has invested in Solid Power.

The startup, spun out of the University of Colorado in 2012, has been working on a novel battery structure that includes an “exceptionally high-capacity cathode with a high capacity lithium metal anode and in combination with a high ionic conductivity solid separator.” 

It’s that last part about a “solid separator” to replace the liquid or gel electrolyte used in most batteries that gives the startup’s concept the title of “solid-state battery,” not to be confused with solid-state power electronics or other applications of the term in the utility field. The benefits of replacing volatile or flammable liquids with stable solids include an “extremely energy dense” profile and “ultimate safety and reliability,” according to the startup’s website

The website doesn’t include too much detail on its technology. But in 2015, Solid Power and and the Department of Energy's Oak Ridge National Laboratory signed an exclusive licensing agreement allowing the startup to use a “portfolio of ORNL patents relating to lithium-sulfur compositions” that “can provide two to three times the energy of conventional lithium-ion technologies.”