Using Telecom Tech, eCurv Looks to Lower Energy Bills, Raise Money
The year eCurv spent pitching its energy management software to potential customers has taught its founder a few lessons.
“The opportunity is much bigger than we thought,” said Edison Almeida, founder and chief executive of the Cambridge, MA, startup, which raised $2.5 million last June and has its eyes on another round of financing by the end of this year.
ECurv presented its software to dozens of the largest retailers in the United States, and the company’s cloud-based power management software now runs hundreds of their electrical systems. The company’s software juggles power use in commercial and industrial buildings and tries to cut electric bills without curtailing operations.
Like residential electric customers, businesses pay a charge for how many kilowatt-hours of power they use. But they also pay a “demand charge” based on the maximum power they use at any one time. For example, running three hair dyers together for 20 minutes would have a higher maximum power than running one hair dryer for an hour. In some areas, demand charges are close to half of a commercial electric bill.
Almeida’s system corrals all the air conditioners, lighting systems, motors, refrigerators, and other appliances that request power independent of one another—“loads” in energy management-speak—and it puts them into a queue so that fewer pull power from the grid at any one time.
This shaves down the highest peaks of demand. “The more loads, the better it is,” Almeida said. “It’s more pieces and parts that we can coordinate to improve performance.”
Almeida, who started his career developing mobile phone systems in his native São Paulo, Brazil, built the eCurv system from the same complex algorithms that arrange the calls, texts, pictures, and data requests that all compete for bandwidth on phone lines.
With his software running in more places, Almeida said the results are better than initially expected. He had projected that eCurv would cut customers’ bills by about 11 percent, but its results are coming in closer to 22 percent.
That is all good news to eCurv’s Series A investors: Constellation Technology Ventures (the investment arm of energy firm Exelon), Vodia Ventures, and the Massachusetts Clean Energy Center.
The next big step for eCurv is raising a Series B round, which Almeida said could close as soon as October. The company has eight employees and is looking to hire software developers.
The industry around electricity demand management is growing from an already sizeable base, according to Ryan Hledik, a principal at the Brattle Group in San Francisco who researches demand management. From Boston’s EnerNOC to Gridium in Menlo Park, CA, a handful of companies are targeting the demand charges that commercial customers pay.
Many of the energy management firms out there analyze companies’ power consumption and come back with times to reduce loads or other ways to dodge demand charges. ECurv’s product finds these times, but it goes a step further by reorganizing the timing of the loads to cut demand.
“It’s an emerging, growing opportunity for these energy management firms,” Hledik said. “As they get further up the learning curve and customers need to manage escalating energy cost, this would only become a bigger opportunity that we will see more companies pursuing in the future.”
SolarCity jumped into the demand management market in late 2013 when it started selling Tesla battery units that can be charged by the sun and discharged during peak times to lower demand charges. Last month, the company said it had raised a $1 billion fund dedicated to commercial solar projects, which could take advantage of this technology.
On Friday, Tesla announced a battery system for utilities and commercial customers, the software brains of which were built by EnerNOC. The units could store up energy from solar panels and other sources for use in the afternoon periods of highest demand.
Almeida sees eCurv’s growth from hundreds of locations to thousands. Beyond the horizon of the next few years, though, he has larger ambitions for eCurv. Today, the company’s technology manages electric loads behind the meter. Someday, it could take on the power grid, or at least a slice of it.
And the vision isn’t too far off: Appliances and electronics could someday queue into the electric grid for power, much like cellphones do with telecom networks for bandwidth.
“That is exactly what we want to do,” Almeida said. “We have chosen demand management as a way to go to market and get a foothold in the market, but our end goal is to get to critical mass so we can demonstrate our technology on the grid scale.”
But the timing for that demonstration is less than ideal. Too few appliances are smart enough yet to communicate with a server. And then there’s getting a utility company or a grid operator to turn over the reins. “Because of that we could not pursue a direct to utilities go-to-market model—that would just take too many years and would be very frustrating to get that done,” Almeida said.