In Smart Energy, Seattle Isn’t as Smart as It Thinks, Says Energy X Prize Guru

7/2/08Follow @gthuang

Within five minutes of sitting down to lunch, Jesse Berst has burst my bubble. “I’m not sanguine about Seattle as a big leader in the area,” he says. “I don’t know if we’ll have a cluster here.”

He’s talking about smart energy and cleantech, and he knows a thing or two about the space. As managing director of Redmond-based GlobalSmartEnergy, Berst provides strategic consulting on energy technologies (and market opportunities) to corporations, investors, and government agencies. He is also the executive director of energy and environment prizes for the X PRIZE Foundation, based in Santa Monica, CA (more on that shortly).

Berst, who’s also an Xconomist, made his name in the 1980s and 90s as a technology analyst, and co-founded three successful high-tech publishing companies. Around six years ago, he decided to work full-time on energy and the environment—something closer to his heart. “I got bored with [information technology], plus it was so obvious that energy was going to be the next big industry,” he says.

Most recently, he’s been focused on the “smart grid.” This is an envisioned upgrade to the existing electricity network, and it involves the use of various technologies—smart monitors and sensors, communications, and advanced software and hardware to control the network, which in the United States is run from 130-odd control centers around the country. The goal is to more efficiently and reliably regulate power usage, and Berst says the smart-energy industry is following roughly the same evolution as telecommunications. Now, because of the growing amount of data to be managed, corporations like Microsoft and Oracle have entered the arena. And the main hurdles to adoption are bureaucratic, not technical.

“Most of our projects are in places like Hawaii and New Mexico, places that are more progressive and aggressive about energy,” Berst says. (This was surprising—I had thought the Northwest was pretty progressive in terms of energy.) In his research consultancy duties, Berst says the key question is, where is the money in cleantech? Corporations, banks, and agencies want to know, should we get into the sector? He is currently advising several startup companies, still in stealth mode; the most recent (“today was our first day,” he says) is looking into building smart-energy infrastructure at the community level, in places like resorts.

The other big thing I wanted to talk with Berst about was the X Prizes. Starting last fall, he began consulting for the X PRIZE Foundation, which sets up ambitious innovation awards to advance the state of the art in space, genomics, transportation, and other fields. Recently, Berst’s team submitted recommendations for energy prizes; the areas being investigated include alternative energy generation, efficiency, storage, sustainable housing, and carbon sequestration. The X PRIZE board is reviewing them, but it may be a while before we can tell you any more (watch this space). Berst did say that any eventual prize(s) should be worth more than $10 million, and should “stretch people farther than a venture-based company would.”

A few more take-aways from our discussion:

—Don’t forget the role of mid-size companies in energy and cleantech. We often look at startups and big players, but Berst points out that “real, permanent job growth comes from small-to-mid-size companies that grow up.” Case in point: Areva T&D, a French smart-grid company that has operations in the Northwest and is looking to hire for its global R&D center. (Its parent company Areva has roughly 150,000 employees worldwide, but the point is to follow the Arevas-in-the-making.)

—Large organizations like Boeing and Pacific Northwest National Laboratory (PNNL) have some hidden gems of energy-related projects, but they often struggle with commercializing such technologies. Nevertheless, says Berst, “they’re a warehouse of breakthrough concepts.” (Berst serves on the advisory council of PNNL.)

—In smart energy, there is a manpower shortage in the Northwest. “We have to import power engineers,” says Berst, because of a dearth of engineering training programs, which were phased out over the past few decades.

My bottom line? Anyone in the area with a serious interest in energy and cleantech can look to Berst’s group as a tremendous resource in their back yard. If they take advantage, perhaps they can help make Seattle a more energy-progressive place.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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