Is AutoGrid the latest nugget unearthed by Total Energy Ventures? That’s what Total’s venture capital arm is hoping. It has just acquired an interest in the California-based start-up that develops flexible energy management systems. AutoGrid’s CEO, Amit Narayan, explains what this may change on the power grid.
What is the product you developed used for and how does it make the power grid smarter?
Amit Narayan: AutoGrid has developed a digital solution that can manage energy equipment connected to the Internet and installed with the end user, which we call Distributed Energy Resources (DERs). They can be solar panels, electric vehicles, smart thermostats, batteries or any other connected object that produces, consumes or stores electricity. Our solution helps to balance the grid by regulating DERs’ electricity consumption and production. To do that, we use all the data that they send via the Internet, which our software then processes in real time and at a large scale. In this way, we know when they have available energy that can be sent back into the grid. Moreover, we can postpone or reduce consumption if it happens during peak demand. Our solution, which in reality is an array of applications, is also capable of diagnosing upcoming breakdowns in the grid thanks to our predictive controls technology, which continuously analyzes and forecasts the behavior of DERs.
Who are your main customers?
Amit Narayan: Our customers are mainly energy companies that are either owners of the power grid infrastructure, or electricity suppliers or distributors. We also work with companies that specialize in renewable energies. They appreciate our solution because all connected electrical equipment works together. The intermittent nature of equipment that operates on renewables is no longer a problem.
How are you paid and what are your current growth prospects?
Amit Narayan: Access to our software-as-a-service (SaaS) applications is sold to customers in the form annual subscriptions, generating recurring revenues. They are not faced with a huge initial investment, due to our SaaS model which scales based on usage. It depends on the amount of equipment that you want to manage with our program and how intensely you use it.
At year-end 2015, our customers used AutoGrid to manage 550 megawatts of power. This summer, the figure rose to 2 gigawatts. These are good results. We’re leaders in this market and our partners, which now include Total, understand the importance of continuous innovation. Last year, we grew by 350% and this year by 400%. Our objective is to keep our growth rate at least at 100% until 2020.
Why did you get into this market? What potential do you see?
Amit Narayan: The potential is enormous. We estimate that there’s a market worth $26 billion a year worldwide for balancing supply and demand on complex and dynamic power grids. Our flexible management approach is completely new. It allows us to take full advantage of the growing number of connected electrical equipment. We feel that it’s clearly an industry that will continue to grow.