Utilidata's Karman meter adapter in action
Imagine a future where every household functions as an intelligent partner to the electrical grid, providing stored electricity, added stability, and early warnings about potential problems. This is the vision of Utilidata, a Rhode Island startup moving closer to realizing its goal with the release of Karman—an AI platform for grid ‘edge’ devices like smart meters, powered by a state-of-the-art NVIDIA IoT board.
Utilidata's AI-powered platform can respond in real time to the growing complexity and dynamism of the grid, doing what centralized control rooms cannot.
Its management and technical teams are industry leaders in electrical distribution, and the $45 million funding it has used to build the business has flowed in from savvy, smart-money investors and industry insiders such as Microsoft Climate Innovation Fund, Braemar Energy Ventures, American Electric Power, and NVIDIA.
The company’s Karman platform combats climate change by optimizing the grid’s generation capacity, making it less wasteful and more efficient. This means Karman has the potential to facilitate the trend toward electrification while keeping the grid’s carbon footprint in check.
Utilidata generates revenues by selling its Karman module and platform to utilities and grid hardware manufacturers. Its most recent big win was last month’s announcement of a tie-up with Aclara, the third largest smart meter manufacturer in the U.S. and a division of publicly traded grid equipment manufacturer, Hubbell (NYSE: HUBB).
Company History
Utilidata has garnered significant industry attention since its founding in 2012. Led by Josh Brumberger, who brings years of experience in government and energy policy, and CTO Marissa Hummon, PhD, a Harvard physicist and board member at grid modernization non-profit LF Energy, the company started as a provider of software to help grid substation equipment more efficient through what is known as Volt/VAR Optimization.
Utilidata’s VVO software, AdaptiVolt, enabled corporate partners like National Grid and AEP to cut electricity generation by three to five percent, but Utilidata realized efficiency gains would be even greater if it shifted its focus to the 'grid edge', installing AdaptiVolt directly onto smart meters.
Utilidata partnered with smart meter manufacturer, Itron, and saw efficiency head up as expected, but Utilidata could see even more potential if the smart meter hardware was more powerful.
In 2022, Utilidata raised $27 million in funding, led by Moore Strategic Ventures and joined by the Microsoft Climate Innovation Fund, NVIDIA, and others. This investment supported Utilidata's expansion into an integrated platform that make smart meters much smarter. Utilidata partnered with NVIDIA to design hardened IoT modules and then designed sophisticated embedded software to leverage its processing power. This AI-powered software platform and module is called Karman.
The software dashboard for Karman, showing real-time electric loads in a Pittsburgh, Pennsylvania ... [+]
In 2023, Utilidata opened a lab in Ann Arbor and partnered with Brooks Utility Partners to produce meter adapter collars that turn conventional meters into AI smart meters. Last month, Utilidata announced it would sell Karman modules to Aclara, the third-largest smart meter manufacturer in the U.S.
Technology Overview
When our country electrified in the 20th century, there was no need for smart meter technology because electricity flowed unidirectionally—from a centralized production plant to consumers. CTO Hummon likens this situation to a railroad along which trains only run in one direction.
However, this century has seen a massive increase in the number and type of generation facilities (e.g., wind and solar farms, grid-scale batter facilities) and the incorporation of many different grid-attached devices (e.g., rooftop PV panels and Tesla PowerWalls). These new facilities and devices mean that power can be generated and ‘dispatched’ from many locations rather than just a handful of central generation plants.
Now that we have ‘trains’ running every which way, our grid needs a better signaling system. Running a grid with a poor signaling system is incredibly wasteful—researchers at Georgetown University estimate that our present grid is overbuilt by 50% to meet peak demand periods that only happen a few times a year.
Hummon illustrates the issue with an example from her neighborhood. She has an EV and a growing family, and often plugs in her EV before throwing her kids’ clothes in the dryer. Our present grid just knows that if there is demand for power, it must supply it, so dispatches all the electricity Hummon needs to charge her battery and dry her clothes immediately. If the homes that share the same neighborhood transformer as Hummon were all to get EVs and do laundry at the same time, the transformer might fail and leave her and her neighbors in the dark.
With Karman-equipped meters, however, each meter can anticipate an oncoming heavy power demand, and make a plan to supply non-essential loads (like the EV charging) at a later time without disrupting anything. Prior generation smart meters could only communicate basic usage data.
In contrast, Hummon says a single Karman-equipped meter can manage an entire mini-grid independently. If the old smart meters were as smart as pocket calculators, Karman-equipped meters are as smart as the newest iPhone. It is this added intelligence that will help our grid do more with less.
Climate/Environmental Impact
Utilidata’s Karman positively impacts two crucial aspects: mitigating climate change and aiding society's adaptation to a post-climate world.
Estimating the carbon footprint effects of future Karman deployments is challenging, but the potential benefits can be gauged by considering the reduced need for new equipment installation due to efficiency gains. Avoiding the construction of new generation facilities, or replacing high-carbon ones with cleaner alternatives, forms a substantial part of Utilidata's climate change mitigation strategy.
To get an idea about this, I read through a newly released report from the Brattle Group—a consultancy—on behalf of the non-profit organization GridLab entitled California’s Virtual Power Potential. Virtual Power Plants do not operate in the same way that Utilidata’s platform does, but some of the positive effects overlap—specifically on the energy reduction side.
The report suggests that ‘demand response’ programs could cut spending on electrical infrastructure by $755 million annually by 2035 in just one state—these savings and the associated carbon footprint reduction hinge on using existing equipment more efficiently.
Utilidata's technology improves resilience when experiencing climate-related challenges by swiftly identifying and addressing issues like voltage spikes and outages (caused by a tree branch scraping against a wire, for instance). Karman-enabled real-time monitoring allows for prompt responses and mitigations, preventing disruptions and enhancing system reliability.
Business Model
Utilidata sails are billowing from a tailwind supplied by the Department of Energy's $3.5 billion grid modernization initiative, funded by the 2021 Infrastructure Investment and Jobs Act. The company's original model was to sell software to utilities and smart meter manufacturers. This business continues, while the new focus is selling Karman modules to smart meter makers.
Two recent DOE awards will enable Portland General Electric and Duquesne Light to deploy over 100,000 Karman units. Last month, it announced a partnership with Aclara, a major smart meter manufacturer with over 30 million devices deployed in North America.
Importantly, Aclara is a division of Hubbell, a listed company that supplies equipment widely used on utility poles and substations. This relationship opens the potential for Utilidata to sell Karman-like modules to Hubbell for even broader integration into distribution grid equipment.
Hubbell's stock price has been on a tear for the last year as investors rush to profit from the ... [+]
Utilidata generates ongoing software revenues from Karman installations and can push software updates over the air. Judging by the investors Utilidata has attracted, I’m not the only one who likes that its growth strategy is supported by diverse revenue streams, one-time hardware sales and ongoing software revenues.
Market and Competition
The market for physical smart meter devices has a few large players like Itron and Landis+Gyr. The smart meters these firms sell are data-gathering devices that transmit to cloud-based processing systems—a model vulnerable to cyber-attacks and performance lags.
Other firms like Uplight and Autogrid focus on aggregating and analyzing smart meter data to help utilities operate more efficiently. Karman could reduce data flows to utilities while providing insights to these analytics services.
Virtual Power Plants (VPPs) represent another approach to efficient grid management. They directly control circuits within a home equipped with smart devices like thermostats to manage electric demand. VPPs can be deployed quickly but rely on user cooperation and centralized control.
While Utilidata says that Karman-enabled smart meters do not have circuit-level visibility into the home, they do allow for the disaggregation of loads and generation like EVs, HVAC, and solar arrays. The company thinks that Karman-enabled systems would provide even more functional, real-time VPP platforms that are aware of both local conditions and grid economics. This would enable Utilidata to partner with VPPs rather than to compete with them.
Erik’s Take
There are two ways to electrify: a dumb way and a smart way. The dumb way is to build a lot of new generation capacity willy-nilly. The smart way is to figure out how to optimize the capacity we have and right-size the grid of the future. Utilidata is doing things the smart way.
Intelligent investors take note.
Martha Martins contributed research and reporting to this article.
