Driving battery storage, IoT, electric transportation mainstream

As investors and corporate strategists look out over the next five years to figure out what technologies will propel business towards a low-carbon future, three phrases dominate.

IoT, storage and EVs.

Big Data connected via Internet of Things (IoT) software is changing what’s possible in industries ranging from farming to building management and manufacturing, allowing energy and water efficiency responses to actual situations on the ground as picked up by data-reading sensors.

Battery storage, particularly when coupled with solar or wind power, already is beginning to alter energy delivery, transportation and the very possibility of access to electricity.

And electric vehicles (EVs) made possible by battery storage are disrupting not only personal car choices by eco-conscious drivers but transportation generally. Public transit in 15 or so years, some predict, won't look anything like it does today and it'll be a lot cleaner.

A panel of venture capital investors and corporate venture or R&D strategists selected 100 companies innovating in these areas that they expect will be able to commercialize their inventions over the next five to 10 years. TheGlobal Cleantech 100were announced mid-week by the Cleantech Group. Buzz about their prospects was all the talk at the group's San Francisco conference Cleantech Forum.

You have to create something so people cannot afford not to do the right thing.

"The nexus between energy efficiency and IoT" perhaps has found a sweet spot when both technologies combined can make a big difference in energy spending, said Joe Costello, CEO ofEnlighted Inc., the North American winner in the Cleantech 100 rankings.

In an interview with GreenBiz, Costello said he has been interested for a long time in the energy efficiency possibilities as helped by Internet technologies. But now, with the precision of IoT sensors, Enlighted can solve other problems a company might have, such as facilities management, while also saving ilot of money on electricity used for lighting.

Clean tech can't bank on customers just wanting to do the right thing for the environment, he said: "You have to create something so people cannot afford not to do the right thing." Enlighted sells LED-based lighting as a service — doing the design, installation and financing — and has found that customers typically save 70 to 90 percent off what they paid before in lighting.

One innovation is selling lighting as a service, Costello said, because companies don't want to budget for plant upgrades but if the spending necessary is covered by the energy cost savings, as it is in Enlighted's system, they're happy.

When technology answers a need that people or organizations can't afford not to have, it is revolutionary, he said. That's whentechnology "can so change the dynamic that it doesn’t matter if people are set in their ways; in the end it can make things so much more economical, valuable and functional that people won’t have a choice but to change."

Asked what beyond his own company's technology seems likely soon to fit that bill, Costello said,"I do believe that in the nexus solar, batteries and electric cars — somewhere in there is a lot of magic happening."

Battery storage, powering electric transit

Battery storage is beginning to provide that economic value that certain institutions can't afford to be without.

At least that's a premise CEO Ryan Popple of Proterra, a maker of battery-powered electric transit buses and another Cleantech 100 company, agrees with:"Transit operators are getting it." They understand what EV technology is about and how in transit it could help them solve the problem of getting soot out of the city center. But again, the value proposition gets the sales, Popple said.

"The most important driver of why EV is starting to rapidly penetrate transit is the simple cost argument," Popple told GreenBiz.The cost of lithium ion batteries has plummeted by about 70 percent, he said, which means Proterracan offer an electric bus at about the same price as a new hybrid diesel bus and "in the next couple of years will be at parity to natural gas vehicles," he said. And, when the cost of buying diesel fuel is included in the equation, an electric vehicle is competitive with diesel buses since the typical city transit bus requires 10,000 gallons of fuel a year, he estimated.

So Proterra's business challenge is not attracting a market; rather it is manufacturing efficiently enough to keep up with sales, or booked orders. "The area we are spending the most time on is learning how to build faster, because the faster we can build the more capacity we will have," Popple said. Proterra is working with suppliers of its composite materials to streamline processes.

Battery storage is changing the utility sphere by enabling solar plus battery systems to replace grid supplied power on residential and commercial buildings and by enabling microgrids as a substitute to grid connection.

Numerous young companies are using Tesla Motors Powerwall and Powerpack batteries for energy storage.

But despite its promise, battery storage as it exists still has some obstacles to get over, several industry participants said.

What is required of a battery to actually solve business problems is four things, said SimpliPhi Power COO Chris Beitel. For one, a battery has to have quite a bit of storage capacity, or be able to store a lot of energy, to be worth it. Two, it has to be able to deliver the power. Three, it needs to have a lifecycle of longer than a couple years and, four, it must be affordable.

Battery technology has not quite reached all four points, he said.

"The energy storage industry is in its infancy," he said.

Nonetheless, Cleantech Group said the number of storage innovation companies in its Cleantech 100 doubled this year to 12 from six companies last year. Competing with battery giant Tesla Motors in some ways, they include Aquion Energy, Imergy Power Systems, Ioxus, Imprint Energy, Skeleton Technologies and Younicos.

But there’s also a slew of start-ups making products or services to work with battery storage, such as Advanced Microgrid Solutions or Green Charge Networks and those that combine IoT and battery such as AutoGrid.

Precision agriculture

A rising sector within clean tech and in the Cleantech 100 is agriculture, specifically precision agriculture, as big data technology meets the field.

“It is the combination of the precision ag technology, in terms of variable rate, the capability of the equipment and then the software technology combined with other services in terms of the platforms coming out,” saidFarmers EdgeChief Operating Officer Patrick Crampton about why ag and tech are suddenly coupling. “A end of day, farmers looking to be more productive. It is one of those rare cases where economic and sustainability drivers are very much aligned.”

But perhaps most noteworthy about the Cleantech 100 is that the largest group of companies fall into an industry category that is often overlooked as the low hanging fruit of sustainability — energy efficiency. Fully 21 companies chosen by the investor and corporate venture panel for the 100 to watch are involved in energy efficiency.

Alphabet Energy, 4Energy, Anesco, Bidgely, Bowman Power Group, Building Robotics, Digital Lumens, EnergySavvy, Encycle, FirstFuel Software, KiWi Power, Next Step Living, OSIsoft, Phoebus Energy, Phononic, Renew Financial, Renovate America, Sefaira, Tendril and Transphorm in addition Englighted are listed.