IBM, Groom Energy Launch Deals, Resources to Advance Smart Grid

IBM, Groom Energy Launch Deals, Resources to Advance Smart Grid

IBM moved forward with smart grid projects on international fronts in separate deals announced Wednesday with the largest privately held energy provider in Brazil and South Korea's largest utility.

And as IBM detailed its latest collaborations to help build a smarter energy grid, Groom Energy unveiled resources and initiatives to help companies better understand the emerging enterprise smart grid and the $5.2 billion vendor market that already exists in the U.S.

The smart grid and the information network that connects energy providers to those who consume it are among the key pillars of a concept GreenBiz Group calls VERGE -- the convergence of energy, information, building and vehicle and transportation technology. The first VERGE conference was held last week, with sustainability experts from IBM and Groom Energy among the speakers who led talks about the impact of VERGE on businesses and sustainability.

In Brazil, IBM struck a deal with CPFL Energia Holdings to work on projects that are aimed at making CPFL's energy networks more efficient, more resilient and better positioned for transition to a smart grid. IBM, which is working with CPFL to develop its smart grid strategy, is providing consulting and assessment services on projects to:

Pilot automatic meter data collection. CPFL plans to install 25,000 smart meters among its largest business customers by the close of 2012.

Manage the data will flows through the meters. The work includes devising management systems that integrate with CPFL business operations and enable the extend and scale smart metering to 6.5 million residential customers.

• Develop the architecture for a communication network to support CPFL's smart grid plans.

CPFL, through its distributors, serves 6.7 million customers in four states, including São Paulo.

The U.S. Energy Information Administration pegs Brazil as the world's ninth largest energy consumer and the third largest in the Western Hemisphere after the U.S. and Canada. Currently enjoying a boom, Brazil's primary energy consumption has increased by almost a third as the country's economy has grown in the past decade.

The growth is placing increasing demands on the country's energy companies to provide adequate, reliable power more efficiently. CPFL's work with IBM is intended to address those needs by building network capabilities for data collection, communication, analytics and operational efficiency -- all of which provide a foundation for a smarter grid.

CPFL's upcoming projects mark its "first foray into the smart metering world," said Michael Valocchi, the vice president and partner who leads IBM's Global Energy and Utilities unit, who praised CPFL's efforts in seeking solutions. "This is a company that's not afraid to look globally for technology, best practices and lessons learned," he said.

CPFL is a member of IBM's Global Intelligent Utility Network Coalition, which is made up of more than a dozen energy companies that are trying to advance the smart grid. The Brazilian firm joined the coalition in 2009 and first partnered with IBM to help determine what it would take to develop a more intelligent energy grid for CPFL and its networks.

IBM announced its work with CPFL and the Korea Electric Power Company, also a coalition member, at the group's semi-annual meeting. Korea Electric Power enlisted IBM to help harness the data that's expected to pour into South Korea's Jeju Smart Grid Test-Bed project.

The project, formally called the Jeju Smart Grid Test-Bed Demonstration Complex, is being built on Jeju Island in the Korean Strait.

With a budget of about $200 million, which includes $68.5 million in public funds, planners envision the site as the world's largest smart grid test bed. The project began in December 2009 with construction of infrastructure. Testing integrated operation of the smart grid is scheduled to begin this summer, continue for the next 24 months and in May 2013.

More than 160 companies are expected to use the area as a living R&D lab to test advanced technology, systems to support it and business models developed for a fully connected, intelligent, low carbon community. Korea has a goal of establishing a national smart grid by 2030. The concept for the Jeju project, the spring board for grid transformation, is shown below.

IBM helped the Korea Electric Power Company develop an integrated energy management system for the test bed's Total Operations Center, which houses the brains and central nervous system for the living lab. Through IBM's work, the companies and consortia using the test bed will be able to collect and manage information on international markets, monitor smart grid systems and participate in data exchange.

The test bed is designed to enable firms to test advanced smart grid technology, then swiftly scale it and bring it to market. The two latter points are crucial to the pace South Korea has set for reducing its greenhouse gas emissions.

"Getting good technology to the right places is always a challenge when you think about innovation," Valocchi said.

At the heart of the smart grid is good data delivered on a timely basis, said Paul Baier, the leader of Groom Energy's sustainability consulting practice and a GreenBiz senior contributor.

Groom Energy rolled out resources yesterday that are designed to help companies understand the importance of energy data, how the grid works and how enterprise smart grid solutions can benefit businesses that are looking to manage energy, costs and carbon.

The enterprise smart grid opportunity involves the integration of sub-metering, software and hardware to achieve energy, cost and carbon management goals

Groom Energy's resources include a white paper on the enterprise smart grid, its trends, drivers and vendor landscape.

The firm also set up a website,, plans to hold a conference on the subject November 2 in Boston and will release a 120-page report in the fall.

Here is a chart from the white paper diagramming end-to-end smart grid:

Although the enterprise smart grid is relatively new, a $5.2 billion vendor market has already formed around it in the U.S. and is growing by 40 percent each year, according to research by Groom Energy. More than 300 vendor companies have emerged and corporate energy managers want to understand how to navigate that space, Baier said.

"They want to know how all these solutions fit together and they want easier systems for tracking out energy," Baier said. Measurement and verification of energy consumption and reductions can produce cost savings as well as incentives and rewards, such as utility rebates, Baier noted.

Groom Energy's white paper is available for free download with registration.

Top image CC licensed by Flickr user Andrew Imanaka. Inset images of the Jeju Smart Gird Test Bed Charts CC licensed by Wikimedia Commons user Pnk212. Chart of the fully integrated smart grid courtesy of Groom Energy.