Seems investors are drawn to Current’s BPL strategy, which is to simultaneously draw two revenue streams: utility companies pay for its power-management applications while users pay for its broadband services.
Privately held Current is tight lipped about its finances, and declined to give revenues, profitability status or even its total investment tally. Jim Dondero, Current marketing VP, said the latest VC round was the company’s third since it launched in 2000.
Current’s BPL technology plays into the long-held concept of an electricity smart grid, which promises to reduce energy demand by as much as 10% and, therefore, the need for more power plants. For enterprises, smart grids may reduce power-related disturbances in the US by 87%, according to The Electric Power Research Institute.
Current’s BPL networks are an element of smart grids. Essentially, they give traditional deaf and blind, one-way utility networks real-time intelligence, Dondero said.
Current’s equipment also works to add a communication network on top of the utility backbone that supports broadband, VoIP and triple-play applications, as well as transmitting electric-usage information back to a central office.
For utility companies, the BPL network enables them to automatically monitor, manage and adjust the electricity demands at any given point in time, which prevents power outages – an increasingly common problem in major US cities, from New York City to San Francisco.
It also does away with the need for physical readings of utility meters.
Literally, every appliance or device that uses energy will be part of the grid, and connected, Dondero said. For a true smart grid there needs to so-called smart devices, such as intelligent fridges and washing machines, which are not yet prevalent in the US.
There will be stages of development in the establishment of the smart grid, Dondero said. Step one is changing from one-way to two-way networks. We’re doing that with our equipment.
Current’s equipment, which is developed by its Current Technologies subsidiary, includes its CT Bridge that sits on top of each transporter on an electricity network. The bridge routes and manages traffic between each of the five to seven residents that are connected to the transformer. The bridge also converts the power signal from medium voltage to low voltage and has built-in security.
Current Technologies also makes a CT Coupler, which bypasses the transformer and injects the communications signal directly onto the power line to establish the broadband connection.
The company also has an upstream device, which may potentially be a few miles from a point on the network, where the signal hops onto a fiber network. In other words, this CT Backhaul Point enables fiber to BPL conversion. Our network is a bit of a hybrid but not anywhere near the last-mile, Dondero said. This CT Backhaul Point
Texan utility TXU Corp, which also became an investor in Current’s latest round of VC, is outfitting its electricity grid in the Dallas Fort Worth area with Current’s smart grid appliances. TXU has more than 2 million customers in area, which will make the completed BPL network the largest in the country, Dondero said.
The TXU project, first announced last December, is expected to be complete by year’s end. The lion’s share of its recent $130m VC package will be spend on this single network.
TXU will pay Current revenues of about $100m over an unspecified, multi-year period for the smart grid services. The deal also has provisions to roll out additional Current services for additional revenue. But Dondero did not provide details.
Current also is working with various electricity device vendors, including Landis +Gyr Inc, the UK electricity meter maker, to embed its communications module into their equipment, so those devices can interface with the network and feed real0-time data to a central office, Dondero said.
Outage management and detection, automated meter reading … a whole array of different applications are possible, he said.
Also, Earthlink will become a retail provider of Current’s broadband services, the company said.
Current’s broadband services promises higher bandwidth than most: up to 10Mb in both directions. Most DSL and cable services top out at 8 megs, Dondero pointed out.
And while most users won’t require 10Mb, at least not in the short term, Current hopes its go-anywhere, installation-free BPL modem, which is about the size of a regular power adapter, will draw users. The modem has built-in Ethernet and WiFi capabilities.
Current’s initial broadband focus is on consumer and small companies with as many as five employees. But because fiber is part of the network, we’re also looking at fiber-based options to larger small business that typically would have multiple users and might want different types of connectivity, Donder said.
The largest BPL deployment in the US so far for Germantown, Maryland-based Current is one in Cincinnati, Ohio, in partnership with Duke Energy Corp, that serves more than 50,000 homes.
There are other trials ongoing in the US, as well as deployments in Europe using BPL technology from Ascom, which Current acquired last fall.
Current purchased those Ascom assets because its US technology cannot be used, where transformer density and electricity grids are different. Ascom also has a portfolio of BPL in-building technologies, which has potential enterprise application, as well as BPL access technology, Dondero said.
However, the need for smart grids is not as acute in Europe as it in the US, where energy usage continues to climb, he pointed out.
In the US, Current competes with smaller BPL players, including Ambient and Ampurion, as well as heavyweights Mitsubishi and Motorola, which has a hybrid wireless BPL.
But Current plans to claim the largest BPL rollout with its TXU deal in Texas. Current has the broadest BPL product portfolio and the deepest deployment industry in the country, according to Current.
The 235-employee company may potentially be acquired by a larger player at some future point, or it may seek to become public. Everything’s on the table right now, Dondero said.
