Are Electric Utilities Actually Embracing Disruptive Start-Ups?

On May 19, GreenTechMedia.com (GTM) published highlights from the 1776 Challenge Festival, an event for start-ups vying for funding related to Energy & Sustainability: Powering the Future.

One of the major event sponsors was the Edison Electric Institute (EEI), an industry association U.S. investor-owned utilities.

Keynote speakers, included former EEI chairman Anthony Earley, the CEO of Pacific Gas & Electric Company (NYSE: PCG-A) who was reported to say, "Non-traditional players will be equally important as utilities in modernizing the grid."

Source: EEI.org website

While electric utilities have large financial interests in the status quo, they also sit at the crossroads of where innovation meets power generation, storage, transmission and distribution.

Related Link: Grid Edge 20: Why Is Disrupting The U.S. Electric Market?

In many respects, California is leading the nation in exploring sustainable energy initiatives, and PG&E has been involved in many innovative pilot programs.

A Surprising Partnership?

Back in 2010, Pacific Venture Capital, LLC, a subsidiary of PG&E Corporation and SolarCity Corp SCTY announced $60 million in tax equity financing for solar installations for U.S. homes and businesses.

The investment was funded by PG&E Corporation shareholders and is expected to allow SolarCity to install more than 1,000 solar systems for U.S. homeowners and businesses via the company's SolarLease and Power Purchase Agreement financing options.

The transaction was the first tax equity financing investment by a utility holding company collaborating with a private sector solar power provider.

Another New Partnership

In February, a non-regulated subsidiary of $52.9 billion cap Duke Energy Corp DUK acquired a controlling interest in California-based REC Solar.

REC Solar provides sales and financing for commercial-scale solar customers and has installed more than 440 U.S. commercial systems, totaling more than 140 MW either installed or under development.

Tesla Looking To Utilities

GTM writer Julia Piper reported Tesla Motors Inc TSLA founder Elon Musk will be a keynote speaker at the upcoming EEI annual convention next month; additionally, Piper publicized that Musk views utilities as his company's biggest customer for its new battery business and is looking to partner with them.

Related Link: SolarCity: Tesla's Battery Storage Plan; Is It Viable Sans Subsidies?

Notably, California has mandated that its three big investor-owned utilities procure a combined 1.3 gigawatts of energy storage by 2022, and customer-sited storage systems can be eligible for meeting that mandate.

1776 Challenge Festival Winners – Energy & Sustainability

Two U.S. energy sector semifinalists won $50,000 each: "Radiator Labs was recognized for its unique Wi-Fi-enabled technology designed to improve the efficiency of existing radiators. BaseTrace was selected for its application of DNA tracer technology to track the movement of industrial fluids for enhanced environmental monitoring."

Piper reported that, "BaseTrace already has a deal with the Virginia-based power provider Dominion Resources...to use its tracers to detect leaks at nuclear facilities."

Dominion Resources, Inc. D has a $42.4 billion market cap, and it speaks volumes that it is looking to use environmental monitoring technology from a small North Carolina-based start-up for such a critical application.

Source: BaseTrace

Notably, the BaseTrace inert DNA markers can also be used to "fingerprint" chemicals used in fracking liquids and trace them by using different markers for each individual well.

Image Credit: Public Domain