The Redwood City, Calif.-based smart grid networking company announced Tuesday that it’s expanding a project it started last year with CPFL Energia, one of Brazil’s biggest non-government utilities. The new rollout, one of the country’s first commercial-scale smart grid deployments to date, will bring smart meters to about 25,000 big industrial customers by the end of next year, with meter vendors Itron and Elster providing the meters.
It also includes plans to smart-meter an “initial” number of residential and commercial customers, as well as to connect distribution automation equipment from Cooper Power Systems and Schneider Electric via the Silver Spring network canopy later this year.
Then, on Wednesday, Silver Spring revealed that it’s working across the Atlantic with EDP Distribuição to supply a “foundational networking platform” for a municipal rollout of one of the Portuguese utility’s many InovGrid smart grid initiatives.
That’s a previously undisclosed international project for Silver Spring, and will include distribution grid networking, as well as meters for both customers and distributed generation resources in the solar- and wind-power rich country.
As for how these new projects will impact Silver Spring’s revenues, the answer in Portuguese is “Depende” (“That depends”). Financial terms of the deals weren’t disclosed. Nor were specific figures regarding the scale of the distribution automation (DA) projects contemplated, or whether the metering portions were tied to broader future rollouts.
Even so, both certainly represent opportunities for Silver Spring to show investors that it’s expanding to new customers in new markets, a critical step for it to scale to profitability after going public earlier this year.
The projects also represent important proving points for the company’s contention that its mesh networking technology, originally built to support wide-scale, densely deployed smart meter networks, can expand to incorporate a range of smart grid functions.
“This is a model that I think can be very valuable for utilities in this part of the world,” Eric Dresselhuys, Silver Spring’s executive vice president of global development, said Wednesday from a borrowed cell phone at the Distributech Brasil conference in Sao Paulo.
While he wouldn’t disclose financial figures on a cost-per-meter basis for its CPFL Energia project, “It’s very cost-effective, standalone on these initial deployments,” he said -- “and then it only gets better.”
Brazil’s Greenfield Opportunity for Smart Grid
In Brazil, that’s due to how the country is planning to build out its smart meter infrastructure. Until recently, the country was expected to be a huge new market, with a plan to mandate 65 million smart meters across the country by 2020. But last year, the government scaled back on that mandate, opting instead for a far more gradual rollout starting with big power users, and an unclear pathway to reaching the residential masses.
That means that the CPFL customers that Silver Spring has networked thus far -- a set of large industrial users known as “Grupo A” customers -- are spread out across a fairly broad geography in the Brazilian state of Rio Grande do Sul, one of five states in which the utility operates.
“That allows us to build a network canopy that goes over the whole service territory,” Dresselhuys said. “From there, we can start to add on, expand, and add new applications,” including adding smaller-scale “Grupo B” customers, as well as the fault indication and automated switching projects aimed at reducing outages and improving power reliability, he added.
Industry analysts have questioned whether mesh networks like the ones that Silver Spring deploys, which send data in “hops” from meter to meter up to collection points that merge information back to utility control centers via cellular or fiber, can handle geographically dispersed deployments like these.
“At least with our solution, it’s a pretty high-power radio, it gets very good range, and you can design the network to handle the much lower density,” Dresselhuys said -- although that requires more repeaters and relays to connect the dots. According to Tuesday’s announcement, Silver Spring’s IPv6 platform is providing connectivity rates of 99.8 percent.
Brazil’s smart meter market remains a highly competitive one, with Itron, Landis+Gyr, Elster, Sensus, Siemens/eMeter and General Electric partnering with domestic utilities, as well as with meter manufacturers such as ELO Sistemas Electronicos.
Bloomberg New Energy Finance predicted last year that Brazil’s utilities will spend about $670 million per year between 2014 and 2017 to install some 4.5 million smart meters. While CPFL has some 7.5 million customers, it’s hard to say how many of those will receive smart meters over what timespans, given the country’s move away from a mandated rollout approach.
Portugal’s Renewable-Powered Smart Grid Vision
As for Silver Spring’s work in Portugal, it’s part of InovGrid (PDF), one of Europe’s many ambitious smart grid projects. Starting with a 30,000-meter deployment in the city of Évora, the project is aimed at eventually linking the entire country with smart metering, distribution grid management, electric vehicles charging and wind and solar “micro-generation” assets.
Silver Spring’s piece is in the municipality of Batalha, and expands upon prior work with EDP that Dresselhuys described as “a small proof of concept type project” for EDP. The idea was to demonstrate the benefits of wireless networks as compared to the powerline carrier (PLC) technologies that dominate most of Europe’s smart meter plans, which transmit data over the same wires that carry electricity from grid transformers to end users.
“PLC has its place, and will certainly play a role” in Portugal’s smart metering plans, he said. “But as you extend that vision out, in terms of the whole smart grid, I think people start to say, 'I don’t think that’s the right technology,'” whether it’s because some endpoints aren’t connected to the electric system, or because of communications latency and reliability concerns. The extended project announced Wednesday will add more smart meters, as well as distribution grid functions like transformer monitoring and outage detection, to Silver Spring’s list, he said.
Silver Spring has launched projects in Singapore, Australia and New Zealand, but hasn’t had as much success in Europe. In fact, it suffered a setback to its overseas expansion plans this summer, when it and partner Vodafone were passed over by the U.K. for preferred providers for its nationwide smart meter rollout. Those wins went instead to Sensus, Arqiva, and Telefonica, and more recently, Landis+Gyr.
Dresselhuys noted that EDP has roughly 6 million customers, but added that the utility hasn’t yet indicated what its expansion plans were for its partnership with Silver Spring, or for its countrywide smart grid plans. While Portugal, like all European Union countries, is working under a mandate to deploy smart meters to 80 percent of its customers by 2022, the recent decision by Germany to reject that mandate on economic terms indicates that not all EU members will necessarily be moving forward at the same speed.