For gridComm, it’s all about power … saving it, that is
By Benjamin Cher November 2, 2015
- Using power lines as a communications network for smart cities
- Startup will be looking for Series A funding in next 6-12 months
STREETLIGHTS have always occupied the bulk of the energy budget, sometimes accounting for as much as half a city’s electricity bill. Trying to save money on streetlights is an on-going effort.
Light-emitting diode (LED) streetlights are one option, as they consume less power, but the key to cheaper electricity bills is the ability to control exactly when the lights should go on and off.
Singapore-based startup gridComm is aiming to solve that problem for municipal authorities. The best way for cities to control streetlights would be to use the power lines as a network, according to its chief executive officer Mike Holt.
“They are already there, why not use them?” Holt told Digital News Asia (DNA) in Singapore.
Power-line communication (PLC) technology uses the same conductor that is used to carry electricity to also carry data.
One of the issues “with power-line communication was low reliability … but we have a unique approach to make it work well, and the ability to create a network through the city power lines,” said Holt.
“Cities want to reduce the cost and we give them the ability to reduce up to 50% of their electricity budget by doing that.
“Given the reliability of our power-line network capability and the huge need to control streetlights drove our vision to build a streetlight management system,” he added.
The light technology
The typical approach is to use one power-line communication channel, but any ‘noise’ or interference would prevent the data from being sent, according to Holt (pic above).
“In the past that was okay, because you could just try resending the signal, and the requirements were lower since you only had to read a meter once a month,” he said.
“When you get into real-time management, you need to control and read [data in] real-time, so you no longer have the luxury to try resending a signal,” he added.
The problem of ‘noisy’ power lines is especially acute in Asia, and would render single-channel power-line communication unreliable, Holt argued.
“What we do is to divide the power line into 18 independent communication channels,” he said.
“That way, if there’s noise on one or two or three channels, that’s okay because the other ones will still work,” he added.
gridComm has automatic redundancies across these channels, which gives the network 100% reliability, he claimed.
“Each channel can individually adapt to changes in noise, so we can move it to avoid the noise,” he said.
“Furthermore, we have this sophisticated networking software which knows the changes and adapts, so the network can adapt, heal and control in real-time,” he added.
While streetlight control via wireless communications is another option, Holt argued that such an approach is not scalable and would be more costly.
“A city like Singapore has 100,000 streetlights and Jakarta has 250,000 – the only way to make it cost-effective is if you use what’s already there,” he said.
“Wireless also does not work well for these kind of things – because of concrete walls to the weather, the cost goes up if you need repeaters and things like that to boost the signal,” he added.
Market is ready
Municipalities are buying it: gridComm recently announced a contract to deploy streetlights throughout Jakarta, and will be well working with other Indonesian cities, according to Holt.
“We have been designed into cities in China … China was the first market we focused on, as there has been a lot of smart city initiatives in China,” he said.
Smart city initiatives are present in almost every city, according to Holt, and the first thing to think about would be controlling streetlight to save cost.
gridComm makes its money in three ways, according to Holt.
The first is via its networking hardware, where the startup is paid US$100 per streetlight. The second is by providing Software-as-a-Service (SaaS) to control streetlights, and data analytics to help set dimming profiles as well as to provide predictive analytics.
The third way is a ‘shared cost savings’ approach, which is just starting implementation. This is where the company works with the streetlight makers and share in the cost savings the city makes on electricity by using its technology.
“We get a cut of the savings that way,” said Holt.
gridComm has had its fair share of challenges, especially since it occupies the less ‘sexy’ business-to-business (B2B) side of startups. This is where it is not just about acquiring app users, but about building scale from the get-go.
“The big challenge for us was to build this as a high-volume business and not a niche product from the beginning – having to put in place the capabilities around volume production and scale, and to be able to deploy this at scale immediately,” said Holt.
This meant gridComm had to quickly build its partnerships and manufacturing relationships to be able to quickly ramp up production to meet high-volume demand when orders come in.
“Another challenge is to do think globally about the business – this was never about one city or one country, but about doing it in multiple cities,” Holt said.
The third challenge is that ‘time-to revenue’ is going to be longer than what it would be for the usual consumer-facing startups, he argued.
“It takes a lot of work to get there, to be able to build a business and plan around that – seeing high-volume production with no revenue and funding it is a challenge,” he said.
“It’s not a linear business, to go for a long time to get a big jump in revenue instead of incrementally – it takes more planning and more faith, as well as the right investment, to enable that kind of business,” he added.
Tariffs and future growth
gridComm’s initial funding came from Get2Volume, an incubator with a focus on B2B startups, as well as co-investment from the National Research Foundation’s Technology Incubator Scheme.
“That, plus an angel investment, was the initial S$800,000 (US$574,000) that funded the company,” Holt said.
“We also received a grant from Spring Singapore as well as other smaller grants of around S$500,000 (US$359,000) – in total we have received about S$1.5 million (US$1 million) in funding to date,” he added.
The startup will be raising a Series A round within the next six to 12 months, and will be looking to raise US$4 million.
“We have quite a bit of interest, and the funding is now about scale – how to do it in more cities and roll it out on more streetlights,” Holt said.
“We’re focused on enabling smart cities and so we talk to many cities, across geographies from Europe to Asia,” he said, adding that there was a “lot of activity in Russia.”
gridComm’s technology roadmap includes adding analytics to better control the streetlights, and extending this to other IoT (Internet of Things) sensors embedded within the streetlights.
On the personnel front, more technical and support teams are needed in the markets gridComm is already active in, according to Holt.
“First that will be China, where we already have a lot of activity and some people there … and certainly in Singapore,” he said.
“In terms of core growth, R&D (research and development) and roadmap execution will happen in Singapore, growing in size with scale,” he added.
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